Solothurn Economic Development Agency: a quality environment for business and pleasure
With access to a workforce of 1.5 million people and offering tailored tax solutions, the Swiss canton of Solothurn's ongoing success in attracting companies is hardly surprising. Solothurn Economic Development Agency's head of promotion and investment projects Karl Brander discusses the region's rent prices, transport links and core industry clusters.
Can you tell us a bit about the Canton of Solothurn?
Karl Brander: The Canton of Solothurn is an area of 790km2 nestled between Switzerland's major cities: Zurich, Basle, Berne and Lucerne. It has a population of roughly 250,000, approximately 20% of whom are foreigners coming from 140 different countries.
The economy is similarly diverse - besides major industries such as med-tech, watchmaking and precision mechanics, a multiplicity of small and medium-sized companies forms a robust and sustainable marketplace of 10,000 companies.
Is Solothurn's diversity attractive to companies?
Yes. More and more are coming to the area. They usually intend to form close ties with existing clusters, centralise business services for their Swiss market development or place functions for their international setup.
Having said this, and considering the many more companies that are to come, it's easy to neglect the most important part of our economic prosperity - the existing Solothurn companies. These firms grow, diversify and create new jobs. In order to facilitate this, the general business conditions must be optimal at all times.
How good are transport links to major Swiss cities?
Solothurn's optimal location within the Swiss Midlands means major highways and railway lines cross this territory. There is also pan-European transport, particularly the north-south highways.
As a result, major cities can be reached in 30 minutes and vice versa, probably most easily by railway. This means a workforce of 1.5 million people is in easy range, which is the biggest recruitment pool of Swiss talent. It is why we describe Solothurn as "the heart of Swiss metropolitan areas".
It was once thought that, in a digital age, physical distances were not significant. However, even with digitally dominated businesses, humans are still at the centre, and the better they interact, the more efficient the output. Just recently, the Swiss railway company SBB Cargo International, moved to the Solothurn area and centralised certain services in the city of Olten. The resulting financial savings, just from letting people meet internally during the business year, were about the same as the rent of the new offices.
Do any of the financial world's big hitters live in Solothurn?
The federal councillor for the economy Johann Schneider-Ammann lives extremely close to Solothurn. It is the same economic - though not political - area. His large former company, the Ammann Group, is also located in the city of Langenthal, where it was founded in 1869. It now employs approximately 3,400 people worldwide.
Hansjörg Wyss, the founder, former CEO and president of the well-known med-tech giant Synthes, also lived in Solothurn until a few years ago. He grew his business here before it was sold to Johnson & Johnson in 2011. It has now been merged and is called DePuy Synthes, which has its European headquarters and production sites in Solothurn.
Mathys European Orthopaedics in Bettlach is another med-tech firm from the same area. Founded just after the Second World War, the business and entire Mathys family are still located in the canton of Solothurn. The company has also created a foundation for med-tech research, technology transfer and services.
The CEO of the largest Swiss real estate company, Swiss Prime Site (SPS), has also lived in the area since childhood. SPS is located in the city of Olten and has a real estate portfolio, predominately in Switzerland, valued at CHF 9.3 billion.
Can you help individuals and companies looking to save on expenditures?
Given that the canton of Solothurn is not an urban centre but is still in striking distance of them, the pricing level is modest. Rental costs, for instance, are around 20% lower than in the cities. Moreover, it is one of the most wallet-friendly places in the Swiss Midlands due to a healthy cost structure for individuals and companies. It also has one of the most streamlined cantonal administrations in Switzerland.
A study from Credit Suisse on disposable incomes throughout Switzerland calculating the ten most important expenditures for individuals - tax, apartment rent, insurance, etc - ranked the canton of Solothurn as the best in the Swiss Midlands.
Companies can save on expenditure every day. The low-cost structure combined with the excellent location in an economically dominant area of Switzerland is a good long-term choice.
What about the financial and tax benefits of moving a business to Solothurn?
The Solothurn Economic Development Agency (SEDA) offers full services for free. In our broad network - locally, nationally and internationally - we can address any question and connect with the right partner at the right time. SEDA opens doors, as well as bolstering and covering investors and project sponsors.
Incentives are similar to many other cantons. Currently, we focus on exclusive and tailor-made tax solutions and tax incentives. In some geographic areas, these can also be offered at the federal level. As a result, under certain prerequisites, tax holidays can also be applied to the 8.5% federal tax. This can lead to a highly significant temporary tax reduction. Solothurn is a place where almost everything is possible and can be achieved without layers of bureaucracy. It is extremely rewarding to businesses and new ideas. This healthy mix means our location is full of long-term benefits.
Are there any more general advantages of living in Switzerland?
There are some well known attributes that separate Switzerland from the rest of the world: cleanliness, quality of life, lakes, mountains, chocolate... People are also aware of the Swiss focus on precision, which is something we have achieved and maintained through an extremely positive working attitude. In our eyes, this is one of the secrets behind the small Swiss economy's ability to sustain huge global pressures and competition.
For a long time, though even more so recently, we have developed our eco-friendliness. Most likely, this has its roots in the largely unknown but very typically Swiss qualities of modesty and self-restraint. Modesty may come as a surprise, because it is not usually associated with a vital economy, very high GDP and one of the highest quality-of-life levels. Yet we believe it is how we have attained these very things.
These factors are all particularly well displayed in Solothurn - it becomes obvious in daily life. There is no red tape when you get in contact with the administration. People are open-minded and always willing to offer a helping hand. There is always the readiness to give that extra effort.
Finally, what really separates you from the other cantons?
Though Switzerland has only been an official federal system since 1848, it has a much longer history of using similar organisational structures. Despite the differences that can occur in all areas and at all levels, it has always been the will of the cantons to find a common way.
In economic terms, Solothurn is separated by its cluster of precision mechanics. This is unique not just in Switzerland but also in the whole world. To our knowledge, the density of know-how in this area is unparalleled: it is detailed, wide-ranging and has been built up over generations.
Another distinction is that the main language here is German, which obviously marks Solothurn out from the French-speaking cantons in the west. This works to our benefit, as Solothurn is one of the areas that interlinks these two official languages. It also symbolises what Solothurn is: a canton that is central to Switzerland.