Grisons: Wish you were here – Paolo Giorgetta

With its high quality of life and low, liberal rates of taxation, Grisons is becoming increasingly attractive to export-oriented businesses around the world. Paolo Giorgetta, who is responsible for the easternmost canton's economic development, reveals why European companies would be wise to relocate to the largest of Switzerland's 26 federal states.

From oil traders and hedge funds to chemicals and pharmaceuticals organisations, Switzerland has proved remarkably attractive to foreign firms over recent years. In the face of serious budgetary constraints across Western Europe, the country's considerable tax levity gives companies the opportunity to relocate, and escape rising bills and tighter regulation.

Of Switzerland's many cantonal districts, Grisons is perhaps less well known for the diversity of its business. With dramatic and oft impassable mountains, and deep, distinctive valleys, the canton's economic reputation is built upon its steady and successful international tourism industry. But this balance is beginning to change.

Businesses are attracted by the excellent geographical position of Switzerland's largest and easternmost canton. Surrounded by Stuttgart, Munich and Milan, Grisons is located on the axis between northern and southern Europe. A string of internationally regarded corporations, including EMS Chemie, Hamilton, Würth, Hoppe, Trumpf and Baxter, now have headquarters or subsidiaries in the region.

"Grisons has a very business-friendly environment. We're here to help investors and companies set up and find an ideal location, and get all the permissions and paperwork they need in place."

"Obviously we're known for tourism and we're not looking to change that," says Paolo Giorgetta, head of economic development for the canton. "Rather, what we want is to extol the many advantages of business. We want to promote Grisons as an economic location that is deeply attractive to export-driven industrial companies."

The canton's economic and organisational credentials are unlikely to be harmed by the presence of the annual World Economic Forum in Davos. The forum, which was founded in 1974, invites business executives from across the world to discuss issues surrounding economic growth, sustainability and social development. It's a valuable exercise for Grisons, which can take the time to share the canton's business plans with a community of international investors, academics and corporate leaders.

"It's very important for the canton's reputation," comments Giorgetta. "The World Economic Forum is a great event that can help promote Grisons to the entire world, not only as a touristic canton but also as a place of economic activity. We want that to continue and we'll do everything we can to help."

Wanted: green, export-driven industries

Taxation is perhaps one of the most important reasons why Grisons has become such an attractive place for international business and investment. Of the country's 26 cantons, Grisons has the fifth-lowest rate of individual taxation and a rate of corporate tax which, though average among the Swiss federal states, is still far lower than that of other countries.

"Our low, liberal tax rates will undoubtedly attract companies and provide the general conditions needed for good business activity," says Giorgetta. "The law also enables us to grant companies 100% cantonal tax relief for up to ten years. In some areas it is possible to grant relief on federal taxes as well.

"Obviously there are certain caveats: we would want the company to create well-qualified jobs, and have high added value and a low environmental impact."

For Giorgetta, these are the fundamentals that any business looking towards Grisons must be able to demonstrate. And they can take note from the cluster of successful industries - from life sciences, chemicals and plastics through to ICT, tool construction and electronics - that have set up shop in the canton over the past few years.

"We are looking for a mixture of businesses from all kinds of industries, so long as they fulfil some basic prerequisites," he says. "Firstly, they should be export oriented; we're not looking for competition within our canton. Secondly, because we're a touristic canton, we think it's important to maintain the physical integrity of the landscape. We don't want to attract environmentally negligent companies that might damage that side of our economy. And, finally, we welcome businesses that will invest in facilities for our canton, create new jobs and improve the economy."

Attractive business environment

In addition to a supply-side tax policy, the canton offers other important incentives to new businesses. An economic development law, for example, provides financial support
in the form of loans, repayable over a maximum of ten years at a 2012 interest rate of 1.25%, or à fonds perdu contributions. For start-up and spin-off companies, Grisons can also offer coaching services and guidance for those seeking appropriate financing.

"We can give new businesses a lot of support," explains Giorgetta. "Our canton will supply the right infrastructure and a firm foundation for innovation, research and development. For instance, we have set up a research centre known as CSEM for nanomedicine, which can provide great opportunities for scientists of all ages. We are also home to the AO Foundation, which is known worldwide as a very important institute at the forefront of surgical developments."

Grisons' dedicated service team and congenial legal system are other benefits that are designed to make relocation easier for new businesses. Moving an entire company across borders is not a simple matter, so having proper help and guidance can make a big difference.

"Grisons is ranked top of the country for a range of well-being indicators including income, leisure facilities, weather and education."

"I think, compared with other places, it's quite easy to set up a business in our canton," Giorgetta says. "We have a very business-friendly environment. It's possible to arrange a meeting with members of the canton government and our office will do everything it can to provide a comprehensive one-stop-shop service. We're here to help investors, and interested people and companies set up their business, find an ideal location, and get all the requirements, permissions and paperwork they need in place."

Access to great minds

Education and other forms of public infrastructure are also important to Grisons. A well-developed learning environment is fundamental to provide the highly qualified, technically sophisticated workforce that a company needs. In 2009's 'IMD World Competitiveness Yearbook' report, Switzerland was ranked third overall for its educational infrastructure, with Grisons playing an important part in this achievement. The University of Applied Sciences (HTW Chur), and nearby institutions in Buchs, Rapperswil, Vaduz and St Gallen all provide a steady stream of expert labour for the benefit of the local industry, as well as the wider public good.

"Our aim is to supply, through education, whatever is needed for the local industry," Giorgetta declares. "We want to fit in and harmonise our education system with other industrial requirements, improving the knowledge transfer from science to industry."

With construction land needed for investors, it's important that the canton can readily provide industrial areas and public facilities. However, this is not always easy for an area that is almost entirely mountainous, where decisions about how the land gets used are made via democratic deliberation.

"We still have some land to sell, but we have to look forward and evaluate which areas would be suitable for industrial investment and new companies," Giorgetta says. "Obviously the land should be accessible - close to a highway, education and other business needs."

A pleasant place to live

Over the next five years, Grisons will be seeking to expand its public infrastructure and build the best possible environment for new businesses. According to Giorgetta, this means developing new industrial locations, improving the technical competence and diversity of the education system, and promoting better transport links to the various districts.

It also means promoting the quality of life that business people and their families can enjoy in this large alpine canton. Various surveys, including one by the Swiss news magazine FACTS, rank Grisons top of the country for a range of well-being indicators including income, leisure facilities, weather and education. Grisons provides good private and international schools for children and teenagers. It also boasts up to 25% lower wage and real estate costs compared with other metropolitan areas in the country.

"Grisons has a high quality of life, great sports and shopping facilities, a naturally beautiful landscape and a great pace of life," Giorgetta adds. "These are strong advantages that not every place can offer."

As global competition for industrial locations rises, Grisons' ability to supply these kinds of conditions is absolutely fundamental. With its existing infrastructure, future plans and business-friendly mentality, the canton is keen to become a key destination for multinationals of all kinds.

Paolo Giorgetta is responsible for the Grisons’ economic development.
“Grisons has a high quality of life, great sports and shopping facilities, a naturally beautiful landscape and a great pace of life."