2023-12-06 09:34:03
Zurich (awp) – Despite below-average economic growth, Switzerland is asserting itself in a difficult market context, marked by inflation, geopolitical uncertainties and rising interest rates, which is curbing foreign demand for goods and services.
Economiesuisse forecasts gross domestic product (GDP) growth of 1.0% for the current year and expects moderate economic development to continue in 2024 (+1.1%). In a press release released on Tuesday, the employers’ organization estimates that the unemployment rate will not increase “significantly” and that inflation should remain around 2%.
Swiss export-oriented companies find themselves in a complicated situation. While several of their outlets are facing a recession, they are finding it difficult to pass on the appreciation of the franc and the rise in costs in their prices.
For good measure, major exporting countries like China and Germany have seen their shipments contract in recent months, resulting in increased competition, all against a backdrop of widespread erosion of demand. The United States is an exception, with growth above expectations, despite recent increases in interest rates.
The surprising resistance of Swiss exports is explained in particular by the significant share represented for Switzerland by the pharmaceutical and medical device industry, less sensitive to economic fluctuations, point out the experts from Economiesuisse.
Contrasting perspectives
The country should experience developments similar to those in 2023 in 2024, although with significant disparities depending on the sector. While the outlook is promising for pharma, medical devices, watchmaking and the food industry, the picture is much more mixed in textiles and construction. The year promises to be difficult for the machinery, electrical equipment and metals (MEM) industry, as well as chemicals.
As for services, most sectors – banks, insurance, consulting, hotels and restaurants, tourism, transport, health, IT, retail – anticipate more or less significant growth next year. On the contrary, printing, publishing and telecommunications are likely to continue to contract due to structural factors.
The employment outlook remains good, despite fewer vacancies expected in 2024 and an increase in the number of companies reducing their workforce. Economiesuisse anticipates an unemployment rate of 2.3%.
In terms of inflation, the federation sees a new surge in inflation looming under the effect of various factors, citing the increase in nominal wages, electricity prices, as well as the increase in VAT and rents. We could therefore see the Swiss National Bank (SNB) raise its key rate again soon, but by 0.25 points at most.
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