Coronavirus to Cost Swiss Economy CHF22 billion

Huge Impact for the Economy

                Coronavirus pandemic is hitting hard the economy due to imposed lockdowns that forced many shops, services to close for an unspecified period of time. In Switzerland also there was partial closure of industrial plants in some cantons. Most affected branches are retail, hospitality and transports with many companies shutting down or employees getting sick or being in quarantine. This nationwide lockdown means huge loses in productivity, which is estimated by the KOF Swiss Economic Institute as shortfall of CHF1.2 billion per week. In good scenario the Swiss economy will lose CHF22 billion (per latest exchange rate 22.7 billion dollars) between March and June, whereas the bad scenario foresees losses up to CHF35 billion. Big part of it – between 44% and 71% - will likely be caused by disruptions in trade with foreign countries, that are also under lockdowns and in state of pandemic due to Covid-19. As of now the Swiss lockdown, imposed on March 17, will last until at least April 17, but it is possible it will be prolonged, as one of top Swiss official Daniel Koch has warned that the country in only halfway there in fighting the pandemic.

More Needs to be Done by Govt

                The KOF institute also warned Swiss government that even with the implementation of current strategy of injecting billions of Swiss francs to aid economy, the situation in the country will be largely influenced by international environments. Global crisis that is on the horizon will trigger more severe economic problems in Switzerland. The KOF institute previously stated more needs to be done by the government to protect business and economy during the pandemic, claiming CHF60 billion aid package to inject emergency funding into most damaged sectors, cover lost wages and issue emergency loans to companies won’t be enough. In addition to economic struggles, also Forex market is impacted by the pandemic with CHF exchange rate getting stronger as investors are eager to buy Swiss francs considered safe have currency.

Swiss Concerned More About Economy Than Health

                Meanwhile, according to a new survey, Swiss become more concerned about the state of the economy than health care crisis. The survey conducted by the Swiss Broadcasting Corporation shows also that while majority of citizens obey to restrictions imposed by the government to stop spreading the coronavirus, they become a bit more bored as time flies by and think some measures could be eased. Many Swiss don’t feel immediate health threat. According to the survey 23% are not worried about personal danger, 53% assumed it will be mild and just 21% are scared it can be serious with only 4% being afraid of fatal consequences. But still majority of citizens are social distancing, especially elderly respondents refrain from going shopping and meeting other people. There has been also observed sharp drop in the usage of public transport. Swiss are optimistic that the health system can last with nearly 70% of respondents claiming hospital will cope with the number of patients, up 25% from a survey conducted in March. Some Swiss feel so optimistic they would like for the measures to be eased – mainly re-opening shops with non-essential goods (51% of respondents) and resuming classes in schools (39%).