by Switzerland has imposed major restrictions on public life in a bid to contain the coronavirus pandemic. (Keystone) Switzerland is headed towards a severe recession this year due to the economic fallout of the coronavirus, experts warn. If the pandemic is brought under control, the Swiss economy should rebound strongly in 2021. The BAK Economics Institute, a Basel-based think tank, says the collapse of private spending will trigger a global recession. For Switzerland, this means reduced service exports due to a drop in demand for tourism and events. On Monday, the think tank predicted a fall in gross domestic product of 2.5% in 2020. That contrasts with its previous forecast which estimated a growth of 1.3% for this year. In an optimistic scenario where the health
Topics:
Swissinfo considers the following as important: 3) Swiss Markets and News, 3.) Swiss Info, Business, Featured, newsletter
This could be interesting, too:
RIA Team writes The Importance of Emergency Funds in Retirement Planning
Nachrichten Ticker - www.finanzen.ch writes Gesetzesvorschlag in Arizona: Wird Bitcoin bald zur Staatsreserve?
Nachrichten Ticker - www.finanzen.ch writes So bewegen sich Bitcoin & Co. heute
Nachrichten Ticker - www.finanzen.ch writes Aktueller Marktbericht zu Bitcoin & Co.
Switzerland has imposed major restrictions on public life in a bid to contain the coronavirus pandemic. (Keystone)
Switzerland is headed towards a severe recession this year due to the economic fallout of the coronavirus, experts warn. If the pandemic is brought under control, the Swiss economy should rebound strongly in 2021.
The BAK Economics Institute, a Basel-based think tank, says the collapse of private spending will trigger a global recession. For Switzerland, this means reduced service exports due to a drop in demand for tourism and events.
On Monday, the think tank predicted a fall in gross domestic product of 2.5% in 2020. That contrasts with its previous forecast which estimated a growth of 1.3% for this year. In an optimistic scenario where the health crisis is quickly under control, the economy should rebound strongly by 4.3% in 2021.
Reduced economic growth will also likely take a toll on employment. The unemployment rate in Switzerland is expected to rise by 0.8 percentage points to 3.1% in 2020, before declining again to 2.7% in 2021.
Negative scenario
In a separate forecast, specialists from the UBS bank said they expect a GDP drop of 1.3% this year followed by a rebound of 2% in 2021, provided emergency measures are abandoned at the end of April. If the crisis continues beyond then, GDP growth could fall by 3% in 2020, they warned.
In this negative scenario, the unemployment rate would increase and weigh on household spending. A wave of corporate bankruptcies would mean defaults on loans from banks. The latter would reduce the volume of mortgages, which would penalize the construction sector. In this case, an economic rebound would not occur before 2022.
You Might Also Like
Online shopping breaches CHF10 billion mark
Swiss shoppers spent more than CHF10 billion ($11 billion) online last year, an increase of 8.4% from 2018, according to a study of retail habits. Electronics and fashion goods dominated orders. Food accounted for just 2.8% of the total goods consumed (up from 1.8% in 2018), but the report’s authors expect orders to increase this year with people reluctant to go to supermarkets in view of the coronavirus outbreak.
How will we judge multinationals when the epidemic is over?
Our regular analysis of what the biggest global companies in Switzerland are up to. This week: responsible business in an epidemic, child labour on coffee farms, and Responsible Business debate. What has made multinational companies in Switzerland so successful is exactly what is making them particularly vulnerable in a global epidemic.
Swiss lawyers seek to keep special ‘advisor’ status in the shadow economy
The Swiss government faces resistance to efforts to tighten anti-money laundering rules that close loopholes for lawyers who act as “advisors” in setting up offshore financial structures. Anti-corruption expert Mark Pieth writes how the lawyer lobby in Switzerland is trying to maintain their special status at the expense of Switzerland’s attempts to improve its reputation as a laundering haven.
Swiss industry fears consequences of US travel ban
A United States ban on travellers from Europe has been condemned as “incomprehensible” by leading Swiss manufacturing association, Swissmem. The Swiss-American Chamber of Commerce has also weighed in, saying firms would seriously suffer if borders remain closed for longer than a month.
Enough food for months, government assures
The Swiss authorities say there are food stocks available to consumers for more than four months to cope with the current coronavirus epidemic. “There is no reason to panic over food,” the government’s delegate for national economic supply, Werner Meier, said in an interview published on Wednesday in various newspapers belonging to the CH Media group.
Coronavirus catches managers off guard
The coronavirus has laid bare the fragilities and complex dependencies generated by globalisation. American-Swiss professor Suzanne de Treville, a specialist in helping firms relocate their industrial activities to the west, hopes that this crisis will trigger some major soul-searching.
Sygnum bank creates digital version of Swiss franc for trading
Sygnum bank has launched a digital version of the Swiss franc (DCHF) to allow faster payments when trading a new breed of securities. The DCHF digital tokens will be backed by the corresponding amount of Swiss francs that Sygnum will hold at the Swiss National Bank (SNB).
Big reductions in Swiss public transport services
Swiss public transport has been widely reduced as of Monday, with the Federal Railways cutting back on services as part of nationwide anti-coronavirus measures. The scaling back of Europe’s most-used rail network in an effort to combat the spread of Covid-19 was announced last week as part of wider measures to reduce social contact and slow down the pace of life in the country.
Tags: Business,Featured,newsletter