Government Figures Says Swiss Economy In 'Hard Stagnation'

by Ulrika Lomas, Tax-News.com, Brussels

16 September 2002

The Swiss State Secretariat for Economic Affairs (Seco) has stopped just short of declaring that the Swiss economy has fallen into a state of recession, referring instead to the country's economic situation as one of 'hard stagnation'.

In revised figures for 2001, released on Thursday, Seco announced that the health of the Swiss economy has remained poor this year, with GDP dropping by an annualised rate of 0.2% in the first quarter, and second quarter growth coming in at just 0.4%.

Some analysts were unimpressed with the Secretariat's 'softly-softly' approach, however, and argued last week that current economic indicators clearly point to a recession. Janwillem Acket, chief economist with private bank, Julius Baer is one such observer:

'It looks as if investment will continue to shrink, and banking and services will have problems,' he told the Swissinfo news service on Friday.

Seco has predicted that the Swiss economy will pick up in 2003, but in a statement accompanying the release of the revised figures, suggested that this is conditional on several factors:

'For a positive development of the Swiss economy it will be crucial that the European Union economies will soon start to recover significantly, and that the real value of the franc does not rise again,' it explained.

Recommended