EY analysis: Geopolitical risks slow down investments in Switzerland
An EY analysis shows that 70 percent of Swiss companies are halting or postponing investments due to geopolitical tensions and U.S. tariffs—yet foreign investors remain loyal to Switzerland.
Swiss companies are facing growing risks in an increasingly difficult international environment. Geopolitical tensions, protectionist measures and tax reforms are slowing down investments and making strategic decisions more difficult. A recent analysis by EY shows that 70 percent of companies in Switzerland have stopped or postponed investments due to geopolitical and trade policy uncertainties.
The latest US trade policy measures, including tariffs of up to 39% on Swiss exports, are particularly significant. This creates structural challenges for companies with strong sales markets in the United States - not least because globally ramified supply chains can hardly be adapted in the short term.
"The tariffs from Washington are just one example of how geopolitical tensions have a direct impact on the strategic reality of Swiss companies," says Daniel Gentsch, Chairman of the Board of Directors at auditing and consulting firm EY Switzerland. "Especially in a highly interconnected market environment, it is crucial to create resilient structures, develop scenarios and flexibly align strategic options to changing geopolitical conditions."
Geopolitical uncertainty is also having an impact on companies' behavior in the M&A sector. While just under half of Swiss companies (46%) are planning a merger or acquisition in the next 12 months, geopolitical uncertainty is leading to a greater differentiation of risk - particularly in transactions with a US connection.
At the same time, Switzerland remains a sought-after location for international investors. In 2024, the number of investment projects announced by foreign companies rose by almost 25 percent; investments from the USA were even 69 percent higher than in the previous year. This success shows that stable framework conditions and locational advantages such as legal certainty and innovative strength have an impact even in geopolitically turbulent times.
"Switzerland must systematically build on its proven locational advantages, such as its liberal and reliable legal system, economic freedom and the protection of intellectual property," continued Gentsch. "A hasty exit from international regulations or knee-jerk countermeasures would do more harm than good in the long term."
