# 13 / 2021

Supply of goods in times of crisis: analysis and lessons for Switzerland

Security of supply does not equal self-sufficiency

Switzerland wants to be supplied with essential goods and services.‘Security of supply’ is guaranteed when vital goods are available in sufficient quantities. There are those who would prefer to produce domestically as much as possible. However, it is questionable whether such ‘self-sufficiency’ would be possible at all.

Statistics show that Switzerland is far from being able to produce all essential goods by itself. It is therefore dependent on imports. This is the case with food, for example. Here, the net self-sufficiency rate (ratio of domestic production to total domestic consumption) was 51 percent in 2018, due to the small agricultural area available. However, this value was only possible thanks to imports – of agricultural machinery, diesel, or fodder, for example. The situation is even more pronounced in the case of oil. Here, Switzerland is entirely dependent on imports.

This dependence is not new. In the last hundred years, Switzerland has never been able to and has never had to be completely self-sufficient. Nevertheless, it is important to note that despite epidemics such as SARS (2003), the swine flu (2009) or the current COVID-19 crisis, food security has never been at risk in recent decades. Security of supply was achieved without self-sufficiency. However, a variety of instruments and measures are needed to achieve it.

How Switzerland ensures its supply of goods today

According to the National Economic Supply Act (NESA), supplying Switzerland with essential goods and services is the responsibility of the private sector. The state only intervenes in a supporting role (principle of subsidiarity). This is the responsibility of Switzerland’s National Economic Supply (NES), which includes the Federal Office for National Economic Supply (FONES).

The NES has various instruments at its disposal for national supply. All measures are to be understood as supplementing imports of goods from abroad.

  • Compulsory stockpiling: if the supply of a commodity can no longer be covered by the market due to shortages, the Confederation can release compulsory stocks. Sugar, rice, fertiliser, animal feed, mineral oil and various medicines are stored. However, stockpiling is the responsibility of the companies themselves.
  • Import promotion programs: in the event of emerging shortages, tariff quotas can be expanded, or customs duties reduced.
  • Export controls: the export of certain goods can be regulated for security policy reasons (export licence). However, supply policy considerations may also be relevant (e.g. export controls of medical equipment by individual EU states in March 2020).
  • Supply and consumption management: this involves the targeted promotion of the production of certain goods and the management of their intended use (e.g. electricity quotas for large consumers by the NES).
  • Monitoring tools: information and coordination platforms are available to keep a constant eye on the situation (e.g. online therapeutic products reporting platform).