Innovation the key as China and Switzerland celebrate 75 years

On the 75th anniversary of their diplomatic ties, China and Switzerland are doubling down on innovation as the driving force behind deeper cooperation, it was underscored at a recent economic summit in Shanghai.

The Sino-Swiss Business Forum brought together over 300 executives, entrepreneurs, and government officials, highlighting how shared values of quality, tradition, and innovation continue to define the two countries' relationship.

Few Asia-Europe partnerships are as rich in history – or as future-focused. Switzerland was one of the first Western nations to recognize the People's Republic of China in 1950, and in 2013 it became the first European country to sign a free trade agreement with China. Swiss companies also led early industrial cooperation: ABB signed a licensing deal in 1965, and Schindler became the first foreign industrial joint venture partner in 1980.

Today, China is Switzerland's largest trading partner in Asia and its third globally, after the EU and the US.

During a visit to Beijing in April, Ignazio Cassis, Switzerland's foreign minister, called for upgrading the trade agreement to reflect shifts in both economies. He noted that the 2013 agreement had already doubled Swiss exports to China and increased Chinese imports by nearly 60 percent.

A 2023 academic report by the University of International Business and Economics, the University of St Gallen, and Shanghai Customs College found that more than 70 percent of Swiss exporters use the free trade agreement, saving over US$220 million in tariffs in 2022 alone.

"That impact is felt on the ground," said Natasha Chi, managing director and vice president of Medela China. "It has helped us reduce costs and operate more sustainably. We hope the government continues to ease policies. Tax incentives for Swiss maternal and infant care firms would go a long way in supporting long-term growth."

Cassis said new areas such as artificial intelligence and digitalization should be included in a renewed agreement – aligning with the innovation-forward mindset that shaped the Shanghai forum, held by SwissCham Shanghai.

A closed-door session brought together leaders from major Swiss companies – including ABB, Roche, MSC, Novartis, Richemont, and Clariant – to discuss market strategies, trade dynamics, and future-facing innovation in China.

Elsewhere, an exhibition showcased new and iconic products from 13 Swiss companies, including Schindler, Sika, and Logitech. Medela, for example, debuted its latest wearable breast pump in Shanghai ahead of its global launch to align with the city's 618 shopping festival.

Medela made its debut at the China International Import Expo last year and plans to return with new products for the Double 11 shopping festival. With R&D centers in Switzerland, the US, and now Shanghai, the company increasingly relies on its Chinese team to develop products tailored to local needs – many of which are later exported globally.

"We now have the flexibility to innovate for China, and from China," said Chi, noting that brand awareness among Chinese mothers has reached 60 percent. "In the next three to five years, China will likely become a major contributor to Medela's global business."

Like Medela, Swiss firms are increasingly embedded in China's high-tech value chain – from precision engineering to smart manufacturing. Shanghai hosts 351 Swiss companies, more than any other Chinese city, followed by Jiangsu Province (141) and Beijing (137).

In Changzhou, Jiangsu Province, the Swiss Center Changzhou – the largest Swiss enterprise cluster in Asia – officially opened in July 2024. It now hosts 42 Swiss companies and 25 international projects with a combined investment of over $700 million.

This wave of investment reflects strong confidence in China's long-term innovation potential. Switzerland topped the 2024 Global Innovation Index for the 14th consecutive year, while China rose to 11th, fueled by its expansive industrial ecosystem.