Government stands by growth targets

The silver lining is still visible

The Swiss economics ministry is sticking to its gross domestic product growth rate targets of 1.8 per cent for this year and 2.3 per cent for 2005.

This content was published on November 26, 2004 - 08:19

The forecast comes despite concerns that rising oil prices could have a negative impact on economic expansion.

The State Secretariat for Economic Affairs (Seco) said in its latest forecast on Friday that recovery in Switzerland would gain momentum next year.

"We remain confident that after three years of stagnation the modest recovery will strengthen," said Seco's chief economist, Aymo Brunetti.

The figures largely confirm Seco’s previous economic outlook.

However, it added that the negative risks had increased slightly and it expects the unemployment rate to rise by 0.1 per cent to 3.8 per cent towards the end of the year.

Looking ahead

For 2005 experts say the number of people out of work is likely to fall to 2.8 per cent from the current level of 3.6 per cent.

As well as the uncertainty about rising fuel prices, there are also concerns that the eurozone, which absorbs about two-thirds of Switzerland’s exports, remains vulnerable to fluctuations in the United States dollar.

Switzerland, which is highly dependent on exports, is recovering from a recession amid high fuel prices on the international markets and a slowing of the US and European economies.

On Wednesday the Swiss Institute for Business Cycle Research at Zurich’s Federal Institute of Technology said the country’s economy was picking up, but it expects the rate of growth to slow down towards the end of the year.

swissinfo with agencies

Key facts

Seco forecast: GDP: 1.8% in 2004; 2.3% in 2005.
KOF forecast: GDP: 1.4% in 2004, 1.9% in 2005.
BAK Basel Economics forecast: GDP: 1.3% in 2004, 1.8% in 2005.

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