Experts Divided Over Future For Swiss Economy

by Ulrika Lomas, Tax-News.com, Brussels

02 December 2002

According to figures recently released by the State Secretariat for Economic Affairs (Seco), the Swiss economy showed stronger growth than expected in the third quarter of this year, increasing by a real 0.6% compared to the same period in 2001.

Despite this, Seco announced last week that it is cutting its growth forecasts for the full year and for 2003, in response to weaker rates of growth in the global markets and slumping consumer confidence.

However, according to the Swissinfo news service, reporting on Friday, observers in Switzerland are divided over the future prospects for the jurisdiction's economy, with many predicting that the worst is nearly over.

Stephane Garelli at the IMD Business School in Lausanne believes just that. Speaking to the news service last week, Mr Garelli predicted that the economy will prove to be more resilient in the current downturn because different factors were behind previous recessions:

'The big difference between the past and this time is that, in the past, [downturns] were triggered by consumption. This time it was triggered by a significant drop in investment,' he explained.

However, UBS economist, Andreas Hoefert was less optimistic, telling Swissinfo on Friday that in his opinion: 'The fourth qarter will be flat and I don't see a pick up until the third quarter of next year.'

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