Switzerland Country Risk Report

Providing comprehensive data and in-depth analysis of political, financial and economic risk.

Report includes: BMI's Core Views, 10-year Forecasts, BMI's Economic Risk Index, Political Stability and Risk Index, Long-term Political Outlook, Operational Risk Index, SWOT Analysis and Structural Economic Sections

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  • Understand and measure the political, business environment and operational risks to your company
  • Gain insight on emerging trends that could support, strengthen or disrupt your activities in the market
  • Benefit from 10-year macroeconomic forecasts and insight into the structural characteristics of the economy
  • Get the long-term political outlook and explore possible scenarios for change
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Switzerland Country Risk Report
Product Price
$1,195.00

Steady Growth Ahead

Core Views

  • In the coming year, rising external and domestic headwinds will weigh on economic growth. These include a Brexit induced slowdown in regional trade and subsequent rise in political uncertainty, a weak short-term consumption outlook and rising risks surrounding the property market.

  • That said, the negative side effects of rapid Swiss franc appreciation in early 2015 have largely worn off with negligible lasting damage to the economy, and Switzerland is poised for stable real GDP growth over the medium term.

  • Switzerland's growth trajectory will be increasingly powered by consumer spending.

  • The government's robust fiscal position implies it will be able to step in and boost growth in the event that any external shock puts a sharp break on Swiss growth.

  • The Swiss National Bank will keep refrain from cutting interest rates deeper into negative territory, and instead will continue to intervene in FX markets in order to prevent excessive franc appreciation. Beyond the next several years, the franc will gradually depreciate from fundamentally overvalued levels.

  • A narrowing of Switzerland's large current account surplus will gather steam in 2016, but the surplus will remain sizeable over the coming years.

Major Forecast Changes

  • We have revised down our Swiss real GDP growth forecasts to 1.1% and 1.4% in 2016 and 2017 respectively, from 1.5% and 1.7% previously.

Key Risks

  • 2016 has been characterised by mounting concerns over global growth prospects given Brexit, rising eurozone systemic risks, the prospect of a Chinese hard landing, and waning confidence in the ability of central banks to boost growth. Switzerland, being a highly open economy, remains high exposed to any further downturn in demand from developed and emerging market trading partners.

Macroeconomic Forecasts (Switzerland 2014-2017)
Indicator 2014 2015 2016f 2017f
e/f = BMI estimate/forecast; Source: National Sources/BMI
Real GDP growth, % y-o-y 1.9 0.9 1.1 1.4
Nominal GDP, USDbn 701.7 664.7 644.4 667.4
Consumer price inflation, % y-o-y, eop -0.3 -1.3 0.6 1.0
Exchange rate CHF/USD, eop 0.99 1.00 1.05 1.05
Budget balance, % of GDP -0.1e -0.1e 0.0 0.0
Current account balance, % of GDP 8.8 11.4 9.8 8.8
Executive Summary
5
Core Views
5
Key Risks
5
Chapter 1: Economic Outlook
7
SWOT Analysis
7
BMI Economic Risk Index
7
Economic Growth Outlook
8
No Lasting Damage From CHF Shock
8
GDP By Expenditure Outlook
10
TABLE: GDP GROWTH FORECASTS
10
TABLE: PRIVATE CONSUMPTION FORECASTS
10
TABLE: GOVERNMENT CONSUMPTION FORECASTS
10
TABLE: FIXED INVESTMENT FORECASTS
11
TABLE: NET EXPORTS FORECASTS
11
Monetary Policy
11
Negative Rates: More Harm Than Good
11
TABLE: NEGATIVE INTEREST RATES - SUMMARY
12
Monetary Policy Framework
17
External Trade And Investment Outlook
18
Current Account Surplus Resilient To FX Shock
18
Outlook On External Position
19
TABLE: TOP 5 GOODS IMPORTS IN 2015
20
TABLE: TOP 5 GOODS EXPORTS IN 2015
20
TABLE: CAPITAL & FINANCIAL ACCOUNT BALANCE
21
Fiscal Policy And Public Debt Outlook
22
Return Of Inflation To Pressure Government Yields
22
TABLE: MAIN REVENUE AND EXPENDITURE CATEGORIES
22
Structural Fiscal Position
23
Chapter 2: 10-Year Forecast
25
The Swiss Economy To 2025
25
Steady Growth To Prevail Over Long-Term
25
TABLE: LONG-TERM MACROECONOMIC FORECASTS
25
Chapter 3: Political Outlook
27
SWOT Analysis
27
BMI Political Risk Index
27
Domestic Politics
28
Little Chance Of Improvement In Relations With Brussels
28
TABLE: POLITICAL OVERVIEW
28
Chapter 4: Operational Risk
31
SWOT Analysis
31
Operational Risk Index
31
Operational Risk
32
TABLE: DEVELOPED STATES - LABOUR MARKET RISK
32
TABLE: DEVELOPED STATES - LOGISTICS RISK
36
TABLE: DEVELOPED STATES - CRIME AND SECURITY RISK
39
TABLE: DEVELOPED STATES - TRADE AND INVESTMENT RISK
41
Chapter 5: BMI Global Macro Outlook
43
Global Macro Outlook
43
Tentative Stability, But New Risks Emerging
43
TABLE: GLOBAL ASSUMPTIONS
43
TABLE: DEVELOPED STATES, REAL GDP GROWTH, %
44
TABLE: EMERGING MARKETS, REAL GDP GROWTH, %
45
TABLE: MACROECONOMIC DATA & FORECASTS
47

Assess your risk exposure in Switzerland with our 100% independent forecasts assessing the pace and stability of this key market. Backed by trusted data from BMI Research's 52 million data point economic forecast model, this report will allow you to measure political, economic, business environment and operational risks in Switzerland with confidence.

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