The financial and economic crisis and the impact on the foreign policies of Switzerland and United Kingdom

Abstract

Analysts say that the current economic crisis has occurred because of global inflation, put otherwise - because of greediness. This research focuses on the local consequences of this crisis rather than on the global ones. The global financial crisis gathering force for a while began in mid 2007 and 2008. Consequently, the world stock market sank, large financial institutions have collapsed or been bought out, and governments in even the wealthiest nations have had to come up with rescue packages to bail out their financial systems, according to a media source. However, global problems affected the local part using the taxpayers to rescue those responsible for the crisis in the first place. Other consequences are: increased unemployment, high oil and food prices leading to inflation and then deflation, a declining dollar value, a bad housing market, and a mortgage crisis. The economic crisis occurred all over the world, but the most affected ones are the developed states since the money circulation was the highest there. On local level, and more particularly in the two case studies being observed - Britain and Switzerland, the crisis touched these countries at different degrees. An overall analysis of the states is provided, focusing on their political backgrounds and current decisions regarding the economic situation since at present this is an essential concern, which will show their strength and political stability. So far, Switzerland's political stability has repaid contrary to the situation in Britain where the outcome of the crisis is harsher. Moreover, because of the financial crisis, political instability is increasing fast even around the world and it is forming new obstacles that need to be overcome. Both states have shown positive evidence in handling the speed of development within the process of globalization. However this crisis has given rise to the opportunity to observe their economic and political behaviour and to assess to what extent their approach has controlled the speed of the crisis. This dissertation focuses on this objective and claims to have achieved a better understanding of the impact of the democratic and liberal forces within each country to address such crisis within the context of public responsibility.