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Switzerland raises 2012 growth forecast

The Swiss government on Thursday revised its 2012 growth forecast slightly higher to 0.8 percent, while pointing to signs of improvement in the eurozone debt crisis.

The government’s previous estimate was 0.5 percent, the economic affairs department (Seco) said in a statement.

Department experts noted that the Swiss economy had slowed sharply late last year, but said: “Since the beginning of 2012, the euro area debt crisis has eased slightly and business surveys conducted in Switzerland have shown the first signs of stabilisation.”

The 2013 growth forecast was nonetheless lowered to 1.8 percent from the previous estimation of 1.9 percent.

Seco also attributed the improved outlook this year to “continuing robust domestic demand” and noted that construction investment has shown solid growth as well.

In addition, Swiss exports have fallen less than expected a few months ago.

A sharp rise in value of the Swiss franc has eased since the Swiss National Bank set a minimum of 1.2 francs to the euro, taking pressure off exporters.

The Swiss currency nontheless remains at historic highs against other major counterparts.

As for unemployment, Seco forecast it would slip to 3.4 percent of the workforce this year from a previous estimate of 3.6 percent, while warning that is was likely to rise to 3.7 percent in 2013.

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ECONOMY

Why Switzerland continues to attract foreign companies despite the coronavirus pandemic

Despite the pandemic, 220 foreign businesses set up their offices in Switzerland in 2020.

Why Switzerland continues to attract foreign companies despite the coronavirus pandemic
Switzerland is a magnet for foreign companies. Photo by Valeriano de Domenico/AFP

While this number is 9 percent lower than in the previous year, these companies have created 11 percent more new jobs — a total of 1,168 — than in 2019. Most of the new jobs were created by companies from China, the United States and Germany.

About 3,600 more positions are expected to be offered by these enterprises in the next three years, according to data from SRF, Switzerland’s public broadcaster.

In fact, Switzerland is one of the very few countries that have been able to attract international companies to its shores in 2020, a notoriously bad year for the global economy.

READ MORE: Why Switzerland’s economy is on the up despite the coronavirus pandemic

Experts believe this is due to the country’s strengths, including political, economic and financial conditions.

“Even in a time of crisis, Switzerland scored thanks to its stability, predictability and security”, said Patrik Wermelinger, member of the executive board of Switzerland Global Enterprise (SGE), which promotes the country abroad on behalf of the federal government and the cantons.

There are also other reasons that had prompted foreign companies to come to Switzerland in 2020, despite the economic uncertainty and travel restrictions.

“Protection of legal rights, freedom, and personal responsibility are stronger in Switzerland than in many other countries, even in times of pandemic”, said SGE’s co-president Walter Schönholzer.

Switzerland’s attractiveness is also boosted by studies showing the country’s economy remains the strongest in the world.

Even though the health crisis plunged Switzerland’s economic activity into a “historic” 8.2-percent slump in the second quarter of  2020, the country still boasts the world’s most resilient economy, according to research by an insurance and reinsurance company Swiss Re. 

The International Monetary Fund (IMF) expects a 3.5-percent rebound in Switzerland’s gross domestic product (GDP) in 2021.

It said Switzerland’s economy absorbed the shock of the pandemic better than other European countries and it “has navigated the Covid-19 pandemic well”.

IMF added that Switzerland’s “early, strong, and sustained public health and economic policy response has helped contain the contraction of activity relative to other European countries”.

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