Swiss Trade Monitor - 04 - Dealing with less Freedom

Abstract

The Swiss Trade Monitor documents time trends in Switzerland's foreign goods trade. The fourth edition focuses on Switzerland's trade relationship with other countries in light of the global decline in freedom as measured by Freedom House. Freedom scores indicate that for 17 consecutive years the number of countries with decreasing liberty has exceeded the ones with increasing liberty. Today, only 21% percent of the worldwide population lives in nations classified as free. These nations account for 50% percent of global GDP. Among Switzerland's top-20 trading partners - collectively accounting for 85% of the country's foreign goods trade - we observe that there is only a modest decline in average Freedom House scores. Only four top-20 partners (China, India, Singapore, and Turkey) are classified as partly free or not free. The trade-weighted average Freedom House score for all of Switzerland's trading partners is 79 out of a maximum of 100. While there is a notable decline of ten points from 2005 until 2020, it has recently stabilized. We document the variation across industries and find that for some key sectors like precious metals, watches, or specialized machines the average Freedom House score is relatively low.