Switzerland is a federal republic with a system of direct democracy, composed of 26 cantons. Though not a member of the [[European Union (EU)]] or [[European Economic Area (EEA)]], it maintains close ties with the EU through bilateral agreements. The country's highly advanced economy is known for its banking and financial services, precision manufacturing (especially watches and medical devices), pharmaceuticals, and tourism. Switzerland maintains its own currency (Swiss franc), a long-standing policy of political neutrality, and is renowned for its banking secrecy laws (though these have been modified in recent years). The country consistently ranks among the world's wealthiest nations, with high living standards, low unemployment, and a strong focus on high-value industries. Despite its small size, Switzerland plays a significant role in global finance and hosts many international organizations.