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ECONOMY

Switzerland has the ‘most resilient’ economy in the world – again

Switzerland has been hit hard by the Covid-19 pandemic, but the country’s economy remains the strongest in the world, a new study concludes.

Switzerland has the 'most resilient' economy in the world - again
Swiss economy is the strongest in the world. Photo by AFP

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

This is the third year in a row that Swiss top the global ranking, “reflecting their comprehensive economic strength against future crises”, the study reported

The country received top marks for all of the research criteria, including its monetary policy, low-carbon economy, labour market efficiency, and human capital.

Canada, Finland, and the United States took the second, third and fourth place. Norway, the UK, Netherlands, Sweden, Denmark, and Germany are in the top ten.

The Swiss Re report comes just days after figures from the State Secretariat for Economic Affairs (SECO) showed that In the second quarter of this year, Switzerland's Gross Domestic Product (GDP) suffered “the biggest decline since records of quarterly data began in 1980”.

READ MORE: Switzerland plunges into 'historic' recession

However, despite the slump, SECO stressed that in Switzerland, which has seen over 1,700 deaths and more than  40,000 cases, the “GDP decline remained limited in an international comparison.”

During the second quarter, Switzerland saw manufacturing slump nine percent, with growth in the country's sizeable pharmaceutical industry preventing a steeper decline.

Exports of goods, excluding precious metals and other valuables, plunged 9.4 percent.

While many of Switzerland’s industries, such as watchmaking, experienced a downturn this year, others, like arms exports, doubled in the first half of 2020. 


 

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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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