According to Bloomberg, Switzerland’s decline in the rankings was due to a deterioration in economic performance, a slowdown in foreign investment inflows, and the impact of U.S. trade policy. As Arturo Bris, director of the IMD World Competitiveness Center, noted, the strong Swiss franc put additional pressure on the economy, reducing the country’s price competitiveness and making it less attractive to investors.
According to the ranking, Switzerland experienced a net outflow of foreign capital amounting to $60.7 billion, placing it last among countries in this category. This may be attributed to asset revaluation and capital repatriation, rather than indicating serious economic problems.
The study evaluates 70 countries across four key areas: economic performance, government effectiveness, business efficiency, and infrastructure quality. Despite a decline in its overall ranking, Switzerland maintained strong positions specifically in the areas of institutional quality and infrastructure.
Trade disputes with Washington have added to the pressure. According to IMD, President Donald Trump’s administration previously imposed some of the highest tariffs among European countries on Switzerland, which negatively affected business sentiment and investment activity. The institute’s experts also point to rising protectionism and the weakening of globalization, which are particularly sensitive issues for small, open economies.
The country’s authorities, however, do not view this as a sign of a long-term weakening of its position. Ivo Hermann, head of the Foreign Economic Relations Division at the Swiss State Secretariat for Economic Affairs, stated that the economy remains one of the most competitive in the world thanks to effective public administration and well-developed infrastructure.
It should be noted that the IMD’s top ten most competitive economies in the world include Singapore, Hong Kong, Switzerland, Taiwan, the United Arab Emirates, Denmark, Ireland, the Netherlands, Sweden, and the United States.
For Singapore, returning to the top of the ranking served as a validation of its economic model. The city-state had already ranked first in the IMD ranking in 2024 and continues to strengthen its position as one of the world’s leading financial and investment centers.
