Switzerland’s State Secretariat for Economic Affairs (SECO) will today release its revised economic forecast for 2020. The report will reverse
Switzerland’s State Secretariat for Economic Affairs (SECO) will today release its revised economic forecast for 2020.
The report will reverse SECO’s December forecast of 1.7% growth in 2020 as demand falls and supply chains are disrupted due to the coronavirus outbreak.
While the government has thus far declined to quantify the outbreak’s impact on Switzerland, its export-driven economy is set to take a severe hit at a time when growth has already fallen below government goals. The economy grew 0.9% during 2019, the slowest since 2009, as manufacturing, chemicals and pharmaceutical industries fell flat on weak exports to Germany, its primary trading partner.
A significant cut to the 2020 growth estimate is likely. Still, the effects of the virus will not be entirely felt until the second quarter, complicating predictions through the end of the year.
Nonetheless, with further travel restrictions set to take effect in Europe and Switzerland banning large events, the country’s economy will be hit on both supply and demand during the outbreak. The government has made $10.5 billion available to ensure liquidity and the payment of salaries, but with the Swiss economy so dependent on exports, it will likely be at the mercy of the economic policies of its trading partners.
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