Outlook Good For Swiss Business In 2006, Says UBS

by Ulrika Lomas, Tax-News.com, Brussels

01 February 2006

With both sales and profits up, the year 2005 was a good year for the vast majority of sectors in the Swiss economy, and 2006 is set to be "nearly as good", particularly for companies in the pharmaceutical and finance industries, according to UBS.

UBS has based its outlook on the results of a broad-based survey of more than 4,700 companies in 27 main sectors and 97 sub-sectors.

The bank says that corporate expectations for 2005 expressed a year ago turned out to be "highly accurate" in terms of all the criteria surveyed: growth in sales, earnings, selling prices, personnel and investment. Only nine of the 27 sectors fell short of their growth targets.

The survey shows that the business recovery continued almost unbroken across the various sectors last year. Banks, watchmakers, pharmaceuticals and chemicals remained the most expansive in 2005.

Retail trade, on the other hand, only narrowly avoided stagnation, while automobiles was the only sector that saw sales slightly dipping.

However, UBS says that despite question marks over the global economy, interest rates and currency trends, most companies see themselves positioned well enough in their markets to be able to continue expanding. Overall, the firms surveyed anticipate nearly unchecked sales growth and even slightly better earnings in 2006.

UBS noted that there is evidence the trend is not merely "a flash in the pan" from the increase in recruitment, which, the bank observed, is being carried out on "a grand scale."

The survey shows that the vast majority of sectors polled have taken on extra staff, a trend that is set to accelerate in 2006.

The greatest need is reported in financial services, IT, real estate, electrical engineering and pharmaceuticals.

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