Switzerland faces recession in 2020 due to pandemic, experts warn
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.
This content was published on
2 minutes
Keystone-SDA/ds
Español
es
Suiza enfrentará una recesión en 2020 debido a la pandemia
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.
External Content
Your subscription could not be saved. Please try again.
Almost finished… We need to confirm your email address. To complete the subscription process, please click the link in the email we just sent you.
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 penalise the construction sector. In this case, an economic rebound would not occur before 2022.
More
More
Coronavirus: the situation in Switzerland
This content was published on
An overview of the latest Covid-related information in the Alpine nation.
Should raw milk sales be banned or should consumers decide?
Swiss food regulations do not allow raw milk to be sold for direct consumption. However, a loophole allows 400 raw milk vending machines to do just that.
Is reforming the Swiss pension system still possible, and if so, how?
Solutions still need to be found to meet the challenge of an ageing population and to improve the pensions of low-paid workers, the majority of whom are women.
This content was published on
Czech President Petr Pavel and his wife, Eva Pavlova, arrived in Switzerland on Tuesday at the start of a two-day state visit.
Study shows proliferation of non-native plants is driver of insect invasions
This content was published on
A global study has revealed that insect invasions are being driven by the proliferation of non-native plants. This can can massively disrupt ecological processes, often leading to serious economic impacts.
Swiss set record for world’s longest hyperloop test
This content was published on
Swiss scientists have established a record for the longest-ever hyperloop journey at a facility in Lausanne, Switzerland.
This content was published on
The Swiss army wants to purchase new German armoured howitzers to replace its existing artillery system which has been in operation for over 50 years.
Poll suggests Donald Trump has many fans in Switzerland
This content was published on
Around a quarter of Swiss citizens would vote for Donald Trump if they had the chance, according to a recent poll. This percentage is higher than in many other European countries.
Swiss court rejects special assistance for student with disabilities
This content was published on
The Swiss Federal Court has rejected an application for special assistance from a student with disabilities at the federal technology institute ETH Zurich.
Police arrest 15 drug dealers in Verbier in southern Switzerland
This content was published on
Swiss and French police have arrested 15 suspected drug dealers operating in the mountain resort of Verbier in southern Switzerland.
New European space tech centre in Switzerland launches its first project
This content was published on
The European Space Deep-Tech Innovation Centre (ESDI), launched in collaboration with the Paul Scherrer Institute (PSI), is to be located in the immediate vicinity of the PSI in northern Switzerland.
Swiss Federal Railways launches campaign for safety on public transport
This content was published on
The Swiss Federal Railways is launching a campaign for greater respect and safety on public transport, with posters to go up in stations and on trains starting next week.
If you want to start a conversation about a topic raised in this article or want to report factual errors, email us at english@swissinfo.ch.
Read more
More
Further billions may be needed to save Swiss companies
This content was published on
Earlier this week, the government increased its emergency funding from CHF10 billion to CHF42 billion ($42.6 billion). Some CHF14 billion will pay the wages of employees on short-time work, with CHF20 billion being offered as guaranteed loans and more funds targeted at specific industries. Non-essential high street shops and services have been ordered to shut…
Switzerland tightens restrictions, announces more economic aid
This content was published on
The Swiss government on Friday announced a countrywide ban on gatherings of more than five people and an additional economic package.
Canton Ticino orders non-essential industry to cease production
This content was published on
The southern Swiss canton of Ticino, which borders Italy, has ordered factories and production lines to temporarily close to combat the spread of coronavirus. The order has been branded excessive by a leading manufacturing association.
You can find an overview of ongoing debates with our journalists here . Please join us!
If you want to start a conversation about a topic raised in this article or want to report factual errors, email us at english@swissinfo.ch.