Published15 June 2022, 10:16
The Swiss economy will be impacted economically by the war in Ukraine, with a growth forecast revised downwards.
In Switzerland, inflation forecasts have been raised significantly for 2022 and 2023.
Yvain Genevay
The Swiss economy ministry has again lowered its growth forecast for 2022, reducing it to 2.6%, against 2.8% previously expected amid concerns about the repercussions of the war in Ukraine and the zero Covid policy. in China. Taking into account sporting events, the growth of the Swiss economy should reach 2.8%, according to the group of experts of the Confederation, which is responsible for establishing forecasts for the Ministry of the Economy.
In mid-March, they were still expecting gross domestic product (GDP) to increase by 3% in 2022, while major events such as the Winter Olympics or the Football World Cup should generate additional revenue. growth for this country which hosts the headquarters of many sports federations, such as the International Olympic Committee and FIFA.
Inflation forecasts up
For 2023, this group of experts has also reduced its GDP forecast to 1.9%, against 2% expected previously, indicates the Secretary of State for the Economy in a press release. Their inflation forecasts have also been raised significantly, to 2.5% for 2022, against 1.9% expected during their previous assessment in mid-March. For 2023, the forecast for inflation has doubled, to 1.4%, from 0.7% previously forecast.
“The Swiss economy has started the year well, but the outlook for the international context has become cloudy,” the Ministry of the Economy explained in the press release, as the war in Ukraine and developments in China present “Risks for the global economy”. The prices of products from Ukraine and Russia, such as energy, certain foodstuffs and animal feed have risen sharply on world markets since the beginning of the conflict.
Negative impact
Although inflation is lower in Switzerland than in the rest of the world, this increase in prices is weighing on demand from Switzerland’s major trading partners, which has a negative impact on some of the Swiss exporting companies.
This group of experts expects the recovery of the Swiss economy to continue, “with above-average GDP growth”, they specify, “but less dynamically than previously forecast”, “to provided, however” that the major trading partners of Switzerland “do not suffer a strong economic slowdown”, they add. Their forecast for the unemployment rate, however, was maintained at 2.1% for 2022 and 2% for 2023.
(AFP)