Forging future together: How finance fuels Sino-Swiss partnership

This year marks the 75th anniversary of diplomatic ties between China and Switzerland — a relationship defined by mutual respect, shared values of openness and innovation, and a long track record of strategic collaboration.

Since the signing of a free trade agreement with China in 2013, Sino-Swiss bilateral trade has more than doubled, surpassing $62.7 billion in 2024. Switzerland is now one of China's largest trading partners in Europe, which sets the stage for even closer collaboration in high-impact areas — finance being one of the most promising.

China is the world's second-largest economy with the second-biggest bond market and equities market globally. Switzerland, meanwhile, is a key global financial center, managing roughly a quarter of total global cross-border assets. The two countries are well-positioned to further enhance financial cooperation as a core pillar of bilateral engagement.

A continued pursuit of internationalization will be key for the next phase of development of China's financial sector. Earlier this year, Chinese Vice-Premier Ding Xuexiang met with Swiss officials, calling for deepening financial connectivity where financial institutions can play a key role. I would like to discuss here four strategic areas.

Capital markets

Stronger capital market connectivity offers substantial benefits. In 2016, China and Switzerland established an innovative strategic partnership — a framework that has become increasingly relevant as China accelerates the development of new quality productive forces.

The launch of the China-Switzerland Stock Connect program in 2022 marked an important milestone. With 17 Chinese innovation-driven companies listed on the SIX Swiss Exchange, Switzerland has become a trusted gateway for Chinese innovation to reach global investors and a springboard into Europe, laying a solid foundation for long-term collaboration between the two markets.

Optimizing inbound access for Swiss institutions through a broadened qualified foreign institutional investor program, as well as developing the derivatives business for onshore licensed entities and exploring mutual fund recognition, could help further deepen two-way capital flows.

At the regulatory level, structured and closer communication between regulators and representative institutions of both countries — on favorable policies and rules to further boost collaboration — can strengthen transparency and investor confidence.

Wealth management

China's wealth management industry is entering a transformative phase. With over 6.3 million dollar-millionaires and the world's largest middle-income population, China's wealth creation has grown rapidly — averaging 8 percent annually in recent years — and now ranks second globally by assets under management, reaching 150 trillion yuan ($20.95 trillion) by end-2024.

Yet structural gaps remain in areas such as global asset allocation, diversification and professional advisory services. Clients' evolving needs from succession planning to intergenerational wealth transfer demand more holistic and sophisticated service models.

Switzerland's experience in private banking of over two centuries offers valuable expertise. Institutions like UBS have long pioneered integrated wealth solutions, combining portfolio management with estate planning, philanthropy and family governance.

Entrepreneur clients benefit from one-stop service models that support their investment, business and institutional needs. The strengthening of the Sino-Swiss wealth corridor is beneficial to the development of a globally competitive wealth management industry in China and supports investment diversification amid the trend of diversifying from US dollar-heavy portfolios.

Additionally, as one of the most advanced pension markets globally, Switzerland offers valuable reference points to China's aging population — particularly in the structure of its three-pillar system and the management of long-term pension assets. At the institutional level, Swiss and Chinese pension and insurance asset managers could explore co-developing solutions tailored to China's growing retiree population.

Green finance

China has built the world's most comprehensive clean energy supply chain and now leads globally in green credit, which has surpassed 30 trillion yuan. Its ambitious goal of peaking carbon before 2030 will require over 25 trillion yuan in financing, showing the need for a robust and sizable green capital market.

Switzerland — and Swiss financial institutions like UBS — bring valuable experience and expertise in directing capital toward positive impact across public markets and private markets, and through blended finance, which is a type of public-private partnership.

For example, UBS Global Wealth Management has made sustainable investments the preferred solution for private clients investing globally. In 2017, UBS launched a first-of-its-kind suite of investment products that directly tied financial returns to the United Nations' Sustainable Development Goals. Such approaches may offer an important model as China works to develop more diversified and impact-driven environmental, social and governance offerings.

Beyond sharing of expertise, both sides could also explore the co-development of cross-border ESG products, engaging in joint research and training in climate finance, and establishing a dedicated regulatory dialogue on green finance supervision.

Digital finance

As digitalization redefines global finance, China and Switzerland are uniquely positioned to collaborate on next-generation financial infrastructure.

China leads in the deployment of a retail central bank digital currency, or e-CNY, while Switzerland has been at the forefront of wholesale CBDC exploration and digital asset regulation. The two countries have already built a technical exchange under the Bank for International Settlements Innovation Hub, offering a strong platform for joint experimentation.

Switzerland's forward-looking regulatory stance has also supported early and active exploration by Swiss financial institutions. UBS, for instance, priced its inaugural senior unsecured digital bonds in 2022 and issued $50 million of tokenized debt securities to high-net-worth individuals and family offices in Hong Kong and Singapore the same year.

The future of Sino-Swiss digital finance cooperation lies in ecosystem cocreation. Near-term opportunities include cross-border payments and legal entity identity systems. Medium-term focus areas include tokenized real-world assets and digital products linked to ESG themes. Longer term, building trusted frameworks for regulatory interoperability and cross-border data flows will be key.

Stronger connectivity for growth

The past 75-year Sino-Swiss relationship has demonstrated a strong partnership built not only on economic interests, but also on long-term vision.

In today's evolving global landscape, financial institutions serve as more than intermediaries — they are connectors of capital, innovations, expertise, networks and opportunities. With roots in both economies, institutions like UBS are committed to contributing constructively — supporting sustainable development, facilitating capital flows and helping shape a more open, resilient and connected financial industry.

Faced with similar dynamics in global trade, China and Switzerland find themselves well-positioned to deepen their business ties. Their shared experiences navigating these circumstances create a unique foundation for fostering stronger economic and commercial partnerships.

By leveraging their complementary strengths, both countries can unlock new pathways for investment and collaboration, reinforcing the long-term vision that has characterized their relationship and paving the way for future growth.

The writer is China country head for UBS AG, chairperson of UBS Securities Co Ltd and chair of global banking China, UBS.

The views do not necessarily reflect those of China Daily.