Espresso is an Italian invention, no doubt about this. In the early 1900s Luigi Bezzera, and later Desidero Pavoni, added steam pressure to the coffee machine and forever changed the way we drink coffee. But today, one of the biggest coffee exporters in the world is Switzerland – without growing a single coffee bean. We export more coffee than traditional coffee producing countries such as Colombia, Vietnam, Honduras or Ethiopia. Let alone Italy.

The reason behind this success story is an innovation: in 1975, the Swiss engineer Eric Favre combined an oxidization system with ground coffee in a sealed capsule. This invention is called Nespresso, what else? Thanks to a great marketing strategy and all three capsule production sites being in Switzerland, Nespresso (together with other capsule producers) is the key reason why we export more Swiss coffee (CHF 3bn) today than Swiss cheese (CHF 750mn) and Swiss chocolate (CHF 900 mn) combined.

Innovation matters to private sector companies like Nestlé, to export nations like Switzerland and to international diplomacy - I will sign next month a revised international Coffee Agreement on behalf of my country at the London-based International Coffee Organisation.

It is a pleasure to be back in Oxford after having visited here in June during the Embassy’s UK tour to engage with academics and industry figures about research, innovation and politics. By the way, I came back today in our Swiss-branded electric taxi.

Today, we have a slightly different look at the same topics. Innovation is key to making political goals happen. We think about the global challenges of climate change or public health. But we are also aware that innovation is a key economic driver for many countries, including the UK and Switzerland.

And increasingly, innovation and technology themselves are becoming the subject of international politics. For example, international science and innovation agreements like the Memorandum of Understanding between the UK and Switzerland, which was signed in London last week, or innovation chapters as part of modern trade agreements, illustrate the rising importance of “Science Diplomacy”.

So, why is Science Minister George Freeman calling Switzerland a “Science Superpower”?

In September, both the European Innovation Scoreboard and the World Intellectual Property Organization (WIPO) named Switzerland as the most innovative economy in the world (with the UK in position). That is nothing new, nothing innovative. This was Switzerland’s 12consecutive year at the top of the Global Innovation Index.

The reason behind this?

-       Switzerland has been spending well in excess of 3% of its GDP on R&D for many years. It is currently at 3.15%, almost twice the investment of the UK.

-       Importantly, more than 68% of R&D investments come from the private sector which is of course the driver of innovation.

-       Switzerland is also patent world champion, with the highest number of patents per capita in the world.

An additional element is international talents: Swiss universities have one of the highest proportions of international students and more than 50% of our researchers are from abroad. ETH Zurich and EPF Lausanne are in fact in the top five of the most international universities in the world.

With a high proportion of international publications and a high scientific productivity and science quality, Swiss universities consistently rank highly in international university rankings. Or to put it differently, of the 10 top European universities nine are either in the UK or in Switzerland.

So far, I have tried to make the point that we are good at “turning money into knowledge”. But innovation is actually the opposite, it is about “turning knowledge into money”. Let’s look at some elements:

Investors, researchers and inventors might be driven by out-of-the box thinking, disruptive approaches and a particular risk appetite. But with all the uncertainty that goes with investing money into researching, developing and launching new technologies, products and services, they first and foremost are looking for a stable, business-friendly economic environment.

The Swiss government therefore focuses on transparent laws and regulations, a well-run education system, low taxes, world-class research institutions, high-quality infrastructure, protection of intellectual property, sound public finance, international market access etc. We are not directing or funding innovation strategies. In fact, we don’t have an industrial or an innovation strategy that highlights particular fields.

At the same time, with high salaries, an open market economy and a continuously strengthening Swiss franc, Swiss companies are under a constant pressure to maintain their international competitiveness. Such framework conditions keep companies on their toes, because to grow productivity, innovation is key.

A study has shown that about one-third of company innovations in Switzerland are initiated by employees in production rather than by dedicated R&D departments.

So, as important as great inventors and researchers are, just as important are the people who translate these ideas into technologies and products. Or in other words, innovation is based on vocational training, which is more than just an alternative to studying at a university. It is the basis for a proper professional career.

More than two-thirds of Swiss young people undergo vocational training and might later attend a University for Applied Science. In this setup, the skills and competences of apprentices in each occupation are defined by employers (not colleges or government). And most of the training happens in the company. This is Switzerland’s talent pool with the skillset that industry is looking for.

Economic framework conditions and skills development are key for innovation. But ultimately, you need the entrepreneurs and the companies to make it happen.

If you look at Switzerland’s high R&D investments, sectors such as pharma, chemistry, food and engineering make up about half of private sector investments. Obviously, global companies like Roche, Novartis, Clariant, Nestlé or ABB with their important R&D investments contribute to a large extent to Swiss innovation success.

But it is not only the home-grown global companies, but also some international companies that came to Switzerland specifically to tap into our research environment, for example IBM’s European Research Centre which won two Nobel prizes in the 1980s or Google’s 4500-person Development Centre or Disney’s Research Studios which develop AI, machine learning and visual computing technologies. Again, their presence in and around Zurich probably says more about Switzerland’s innovation capacity than the figures on government R&D expenditure.

But while big companies get most of the publicity, our backbone is SMEs which make up 99%of our businesses – like they do in the UK.

Our SMEs can only survive because they deliver cutting edge products and services, even if they don’t have big R&D departments, so they are often the “Hidden Champions” of innovation.

In the late 1980s, Prof. Michael Grätzel at EPF Lausanne invented a thin-film solar cell that is particularly effective at converting scattered light or light inside buildings into electricity. Our national Material Science and Technology Institute optimized a similar type of flexible thin film solar cell for real world applications. They have held the efficiency world record for this type of cell for the last 22 years and are collaborating with a small Swiss company, Flisom, to manufacture these lightweight flexible modules for applications such as in vehicles or mobile devices.

Or when the Swiss mechanical watchmaking industry nosedived in the 1970s, companies turned their precision engineering expertise to medical instruments and implants, turning Switzerland into a major Medtech hub to this day. Switzerland is home to 10% of Europe’s Medtech workforce and Medtech products make up 5% of Swiss exports.

Around 400 startups are founded in Switzerland each year of which around 100 are university spin-outs. Compared to other countries we favour “deep tech” solutions, i.e. areas like Biotech, Medtech, Engineering, Cleantech and Fintech, and we are less active in for example e-commerce or internet marketplaces.

Climeworks – to give you an example – is a spin-out of ETH Zurich that pioneered ways to pull greenhouse gas straight from the air either to be reused or for permanent storage in rock cavities underground. It is now a world leader in carbon capture technology and opened the world’s first large-scale plant in Iceland last year.

Switzerland has strongly contributed to the European science and innovation landscape. Although we are not a member of the EU, we have been associated to EU research and mobility programmes such as Horizon or Erasmus. And due to the quality of our research, we had the second highest success rate for our proposals, were heading important research consortia and were one of the most successful countries in all ERC calls.

Swiss participation in Horizon is currently limited by the EU Commission to non-associated third country status, which provides researchers and innovators in Switzerland with a limited participation in around two thirds of the calls for proposals. The UK is in a similar situation.

While we remain focused on participating in the Horizon Europe programme, Switzerland has been taking extensive measures (not for the first time) to bridge the gap arising from this situation.

As part of our transitional measures, we are now replicating the single researcher elements of Horizon Europe with our own funding. In addition, we are also funding collaborative research where we are excluded from Horizon, for example in the area of Quantum science.

As for Swiss-UK science relations, we now have the unique opportunity to deepen our cooperation. The UK is traditionally one of Switzerland’s most important partners in the area of research and innovation. In the past five years, the Swiss National Science Foundation has supported more than 1,100 research projects in which Swiss and UK researchers have collaborated. We both have top science quality, we are innovation leaders and many of our areas of strength are aligned, for example Life Sciences and Biotech, Quantum, AI and space.

For this reason, our Federal Councilor Guy Parmelin and UK Science Minister George Freeman signed a Memorandum of Understanding to boost our scientific cooperation. It is a unique opportunity to bring together two major science and research platforms in Europe, not in an attempt to rival Horizon or Erasmus, but to complement our international activities outside Europe, for example our long-established partnerships with China, India, Japan and others.

With the strengthened UK partnership, we want to contribute substantially to advance science, build technologies and develop talent.

Besides the bilateral track, we focus on the multilateral dimension, such as international research infrastructures and organisations like the European Space Agency, CERN, the Fusion programme Iter and many others. We are CERN’s host country, one of the few countries with an experimental fusion reactor and a Swiss startup company received the first mandate from the European Space Agency to demonstrate the removal of space debris.

So, when it comes to “Science Diplomacy”, we want to use both aspects of the term: we want to use science cooperation as a tool for diplomacy (e.g. with the  "Transnational Red Sea Research Centre" whose objective is to study the corals of the Gulf of Aqaba, shared by Saudi Arabia, Egypt, Israel and Jordan). And we use “Diplomacy for Science” to enable and support international scientific collaboration.

In addition, we are also developing our role in technology foresight and global issues like digital governance and regulation, where Swiss and international organisations in Geneva are showing leadership. An example of this is the “horizon scanning” think tank Gesda (Geneva Science and Diplomacy Anticipator),which was initiated by the Swiss government and is now gathering momentum with high profile international partners.

This type of engagement complements and supports our ambition to be an active and reliable partner and facilitator in global politics generally.

Conclusions

1. Innovation policy is not rocket science. In the case of Switzerland it is a combination of factors that work together successfully. Yes, this includes government policies, first-class universities and funding strategies – but more importantly a love for difficult technologies, a slight obsession with perfection, a dislike of cutting corners and an appreciation of skills at all levels.

2. You need inventors like Eric Favres to drive innovation, but particularly you need a well-skilled workforce to make innovation not an exceptional event but an ongoing process.

3. With a few niche exceptions, Swiss research is driven bottom-up by researchers’ curiosity and sufficient funding to allow long-term research to get high impact publications.

4. Science, research and innovation are international endeavours. Ideas, talents and know-how are rarely confined to borders. In fact, it is often the diversity of people, cultures and approaches that are at the base of scientific excellence. That is why international cooperation is key and a win-win in any case.

5. It is unfortunate that Swiss and UK Horizon participation is used for political leverage. It arguably defeats the purpose which is at the heart of the European Framework Programmes: to combine the best of European science and talent to address the challenges which global politics are dealing with.

Let me end with an idea for UK-Swiss science cooperation: The UK – and Oxford University in particular –  is rightly proud of its space programme and its growing space industry. Switzerland might not have launching pads, spaceports or a proper space programme, but we have contributed substantially to international space missions, from scientific apparatus to payload cases on Ariane rockets to powering Mars rovers.

Or let me share this anecdote from the Apollo XI moon landing in 1969 (to show that there was more Swissness on this flight than the Omega watches): the second thing that was unfolded by Buzz Aldrin and planted on the surface of the moon was the American flag. The first thing was a flag-like sheet to measure solar wind, designed and built by the University of Bern.

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