Opinion: The Economic Crisis And The Swiss Perspective

Being a Euro-sceptic Brit living with Germans and other students of economics has lead to many interesting debates regarding current affairs in Europe. We tend to have different opinions on many issues, although I do find the Swiss here to be equally as Euro-sceptic. Many of these 'debates' are usually held after a few beers – alcohol tends to make philosophers of us all!

Switzerland, not being a member of the EU, is lucky enough to still have its own currency, allowing it to cushion itself from the turbulence of the surrounding Euro zone. Having control of their own currency, the Swiss are able to change their interest rates – much like the UK – in order to suit their own economic needs, whereas the Euro zone nations find themselves tied to the same rates. A disadvantageous situation indeed, which lead to the crisis in Ireland – the Euro zone-wide set interest rate resulted in creating catalyst conditions in the Irish property market. A bubble which popped quite spectacularly back in 2009.

'We want the Deutsch Mark back' Graffiti in Constance, Germany.

The current crises in Greece, Italy, Spain, Portugal and Ireland are prompting Europeans to reduce their exposure to the Euro and to increase exposure to perceived safe haven currencies, such as the Swiss Franc and indeed the Pound Sterling (despite our own harsh economic climate at home). This frenzied purchasing lead to the overvaluing of the Swiss Franc, crippling the Swiss export industry. The Swiss cheese and watch industry are not to be underestimated! Back in November the Swiss National Bank then set an artificial peg to the Euro of €1 : 1.2CHF to protect the Swiss economy. The Swiss Franc is probably the most overvalued currency in the world.

Swiss protectionism has created a noticeable island within the Euro zone. As I have mentioned many times before, prices in Zurich are high – antisocially high at times. The plus side is that this keeps the Swiss relatively prosperous: unemployment is very low, Swiss farmers aren't priced out of the market and consumers can afford to choose high quality, ethical goods (such as organic products) more so than anywhere else I've experienced.

Swiss Francs are a perceived safe haven for European investors.

I remember as a teenager being excited at the prospect of the EU and the new Euro currency. I was (and still am) hugely in favour of greater European integration – I loved the idea of being more easily able to head to the continent. But even as a teenager, I realised that the Euro could not work as a monetary union involving so many different European countries with differing compositions, interests and positions on the business cycle. The main advantages of the Euro are often said to be trade and ease of mobility. Whilst I cannot argue with ease of mobility, I refuse to believe that the Euro is a prerequisite for pan-European trade (again, citing Switzerland and the UK as examples).

Indeed the very same currency which set out to improve the welfare of Europeans seems to be endangering it. For example, I doubt the Irish with a high unemployment rate are currently benefiting from any increased trade. The exception is Germany, whose export industry benefits from the cheap Euro.

The Swiss don't seem to be interested in joining the EU any time soon, particularly considering the crisis, which may end up threatening this country, should the proverbial hit the fan. Fortunately direct democracy in Switzerland ensures that the Swiss will only join the EU project, if they so wish.

If you have any comments yourselves, please leave a comment!

Getting Hold Of Chuffs

Zurich is often quoted as being the most, or close to it, expensive city to live in globally. High standards of quality, high salaries & production costs and low levels of competition all contribute to keeping Swiss prices sky high. Students can feel the pinch at the best of times, not least here in Zurich. However with Swiss economic prosperity come opportunities that can allow students to afford to live here.

Swiss Stock Exchange: You don't have to work in banking and finance in order to be able to afford to live here as a student.

Before even considering looking for jobs, students of the ETH and the University of Zurich are able to accept invitations to participate in paid surveys. Many of these surveys take the form of economic themed games on a network, enabling the more successful of players to earn quite a decent amount. As I discovered, even if you have a run of bad luck, you can still take home pay equivalent to a acceptable hourly wage. Maybe I should try my luck again...

The Swiss Franc (CHF) – affectionately called the 'Chuff' amongst British expatriates in Switzerland – is a strong currency: allowing the Swiss to afford to travel abroad and import.

Thanks to the ETH; jobs and internships in the Swiss technology industry are abundant in Zurich. For those of us not studying technology based degrees, there are also a number of other positions available, for example on the university market place platform.

I have been lucky enough to find work in English tuition. Anyone currently on a year abroad, whether you're in Switzerland or France or Germany, can make the most of this opportunity. By knowing the local language (allowing you to translate expressions and understand your client) as well as English, students and professionals alike appreciate the services you could offer. And most importantly, it can be fun – as such tuition sessions may simply take the form of conversations – whereby you'd offer corrections and tips.

Not only does Zurich appear high on the list of the world's most expensive cities, but it also appears high on quality of life leaderboards too. A correlation perhaps?

It's a bizarre feeling speaking English again after so long, even it is just during a few sessions a week. Although I prefer speaking in German here, it is nice to be able to hold a conversation without having to think constantly about how to formulate what you want to say in a foreign language! It's certainly going to feel strange once I return home after this year abroad!

Regardless of where you are on your year abroad, working in your host country is a great way of gaining useful experience as well as networking – which may better facilitate finding work in the country after graduation, if you wish to return. And for those of us in Switzerland: high prices also equate to high wages, so make the most of it!

Autumnal Reflections

This weekend has been the first free weekend I've had in a while, giving me the chance to reflect on the past two months in Zurich. Autumn is well and truly under way in Zurich, turning the city which is usually so green in Summer, in to rather nice shades of gold and red.

The University of Zurich seen from Rämistrasse.

University is going well and I still find I have quite a bit of free time after taking into consideration all the reading that has to be done. Coursework has begun to be handed out now that the semester has entered its second half. Essay writing in German takes some getting used to, although luckily the assignments are usually quite short. Russian is also going surprisingly well, despite the rather extreme pace. Learning Russian at university is not normally possible in Aberdeen, so I'll have to keep my notes when I return. Of course, a holiday.. ahem – I mean an 'educational' trip to Russia at some point is a must!

After two months in Switzerland I'm finding myself getting used to various things and developing Swiss habits. For example I have probably eaten more Swiss cheese and chocolate than I would've ever imagined. Well, who can blame me when they taste so good?

Swiss Francs look pretty cool, but they take some getting used to.

One thing I haven't yet got used to is using Swiss Francs. The notes are pretty cool but differentiating the coins from one another is quite a challenge. They're all round and silver (except the coins of less than 10 Rappen – or cents) which when compared to Sterling is striking, as British coins are all of various shapes, sizes and colours. Euros too have a little more variety. For example the ½ Frank coin is the same size as the 10 Rappen coin, and smaller than the 20 Rappen coin – which is of course worth less. Coins are often considered as small change and are quite undesirable as they take up a lot of wallet space. Therefore I found it strange that there should be a 5 Franc coin, which is a rather unwieldy chunk of metal. Although when reflecting upon Swiss prices, perhaps the 5 Franc coin is right to be considered as Kleingeld...