Economic Forum on Reinvigorating Geneva’s Economy
Geneva, November 19, 2018: The American International Club (AIC) hosted its annual Economic Forum at the Swissôtel Metropole today with a panel discussion lunch with three of Geneva’s top political and business leaders…Pierre Maudet, Ivan Pictet and Xavier Oberson.
“Banking secrecy is dead and Geneva is doing well” declared Pierre Maudet, Conseiller d’Etat in charge of the Department of the Economy. Mr. Maudet expects the 2018 economic growth to be 3%, which is in line with the strong United States economy. He highlighted that foreign investment has remained an economic pillar and that Geneva has more jobs to offer than the number of inhabitants which is an exemplary situation. Amongst the solutions to further invigorate the Geneva economy, Mr. Maudet focused on helping new technology industries such as block-chain to establish itself, and on the importance of passing a 13.79% unified tax rate.
Ivan Pictet, President of the Fondation pour Genève and former Senior Managing Partner of Banque Pictet et Cie SA, gave a refreshing and frank perspective on some of the issues Geneva is facing. He noted that we are the most expensive canton in Switzerland with a very significant government administration cost due to some duplication between the city and the canton. He gave Zurich as a comparison which achieves similar results for about 30% less government cost. Mr. Pictet stressed that Geneva has great assets to leverage and noted that the international businesses and organizations in Geneva makes up about half of the local economy. A second important industry for Geneva is commodity trading. The key to future economic success in Geneva for Mr. Pictet is to keep these two sectors happy.
Xavier Oberson, Professor of Swiss and International Tax Law at the University of Geneva, described the significant international tax trends starting with transparency, the fight against tax evasion and tax avoidance schemes (BEPS: Base Erosion Profit Shifting). He noted that Geneva is complying with these requirements and even leads the class with its efforts, but we are not receiving the benefits. The solution for Mr. Oberson is to follow another trend, redesigning the tax system to be more competitive. A first step would be for Geneva to pass the unified tax rate under the RFFA because the special tax regimes will be abolished. A second step would be for Geneva to reform the wealth tax in order to keep the wealthy from leaving Geneva.
The panel discussion ended with excellent questions from a very large audience and with the AIC President, Ron Banks, presenting all three panelists with lifetime AIC memberships.