<UL> <LI>for the chemical and pharmaceutical industry</LI></UL>
The chemical industry is present in Switzerland for over 150 years. From the beginning, a small domestic market and the lack of chemical raw materials induced a focus on the production and world-wide marketing of specialised chemicals with high added value. Despite all changes which took place during the course of the years, this basic orientation has continued to be the key to success for the Swiss chemical and pharmaceutical industry, which today emphasises heavily life-science products as well as high-value specialty chemicals.
Economic success is never secured for ever; the industry has always had to face the challenges of the day. Currently, we are experiencing enormous changes in the world economy. The unexpectedly rapid opening up of many Eastern European and South East Asian markets, as well as the unstoppable technological revolution in biotechnology, in genetic engineering, in information technology and telecommunications are creating a new international economic environment.
The companies operating in our industry face a continuous need to adapt to this changing environment. Existing manufacturing locations world-wide are being re-evaluated to assess competitive advantages; new corporate objectives and restructuring are inevitable to successfully operate under intensified international competition. For a long time, the strength of the Swiss chemical and pharmaceutical industry has been innovation and the ability to quickly respond to changes in the domestic as well as in the foreign environment.
A merely defensive corporate strategy geared exclusively towards greater efficiency - rationalisation and cost reduction - would not go far enough. In our sector, each cost-cutting strategy must be supplemented and extended by a strong element of innovation. The capability for innovation is and remains our most important key for future economic success. Innovation today, however, is not limited to products and production methods, it also includes administrative processes and organisational structures. Translation of ideas into fully developed products and services has to be better, faster and more cost-effective. This means that innovation no longer depends solely on the scientific skills of a few top scientists, but is increasingly determined by the professionalism of the entire workforce.
An important aspect of modern management in the chemical and pharmaceutical industry is the trend towards highly competitive companies focusing on their core competencies. Such companies control all elements of the total value chain - from the raw material to the final product - without however, owning all the elements of the chain. By co-ordinating the collaboration of many autonomous firms, large virtual enterprises arise. Each contributing node in the value chain concentrates on developing its specific strength in this network of firms. The division of labour intensifies in line with the comparative advantages of the individual companies. While the core companies restrict their activities to innovation and co-ordination and shrink their workforce size accordingly, their periphery of business partners, suppliers, traders, laboratories, etc. grows through outsourcing. The emerging niches enable a considerable number of smaller, medium-sized enterprises to operate as specialised sub-contractors and service providers, both at home and abroad.
<UL> <LI>for Switzerland</LI></UL>
The changing international economic environment also presents a great challenge to individual countries. In a world where all production factors, with the exception of labour, have become mobile, Switzerland must create internationally outstanding conditions for the economy in order to protect the welfare of its citizens. Countries too, have to follow the dual strategy of 'cutting costs - promoting innovative capability'. scienceindustries therefore expressly welcomes the program of economic renewal launched in Switzerland a few years ago. It hopes that this revitalisation will boost competition and exert a favourable influence on price and cost levels in Switzerland, which are excessively high compared to international standards.
At the same time, capabilities of Swiss companies for innovation must be strengthened through setting appropriate basic conditions. To achieve this, the legislation should not delay or prevent advances into new areas of knowledge and technology and their industrial development in Switzerland. Rather, the government has to contribute towards a climate of openness to innovation. Genetic engineering will play a vital role for the future of our industry. It is a modern key technology that is essential in all scientific fields of the chemical industry, from research to manufacturing. The industry is in need of reliable legal guidelines to allow the application of this technology in Switzerland. Academia and industry have to increase their efforts to convince the population of the benefits of genetic engineering in daily life. Distrust can only be allayed through open information; acceptance only gained through honesty.
Finally, an up-to-date Swiss government must also ensure that its institutional relations to the world economy, that is to its major trade partners, are on a basis that meets the new economic challenges. This includes, first of all, a commitment to actively contribute to the deepening and strengthening of the multilateral trade system of the World Trade Organisation (WTO). It also includes the establishment of our relationship with the European Union on the basis of the current realities and developments.