Unions call for weaker Swiss franc to help economy

Trades Union Federation Secretary Serge Gaillard has said the value of the Swiss franc is too high Keystone Archive

The Swiss Trades Union Federation has called on the National Bank to try to weaken the value of the Swiss franc against the euro.

At the Federation’s annual news conference in Bern, Secretary Serge Gaillard said a weaker franc would be helpful for a rapid recovery of the Swiss economy.

“The Swiss National Bank should aim at a margin fluctuating between 1.5 and 1.6 francs to the euro,” Gaillard said.

He added that in the 1990s Switzerland had for a long time been outside the influence of the world economy because of the strong appreciation of the franc.

“This time around, the Swiss National Bank has quickly lowered interest rates…but the exchange rate of the franc remains at a much too high level,” he commented.

Gaillard observed that since 2000, Swiss products were now 8.5 per cent more expensive than European products, and the National Bank had minimised the increase.

“We are dealing with a clear worsening of competitiveness at the level of prices,” he said.

Stagnation or recession

The Federation said it feared stagnation or even recession for the Swiss economy this year and warned that the number of people unemployed in Switzerland could break the 100,000 barrier beginning in February.

The unions are calling on employers not to make people redundant in the present situation but to shorten the working weak. “We hope that this situation will not last very long,” Gaillard said.

The Federation announced it would continue its campaign to fight for a minimum net wage of SFr3,000 ($1,818) per month, adding that it was very pleased by the public’s response.

It added that its other priorities included an acceptable solution to the problem of people taking early retirement and protection for those people on low or medium wages.

swissinfo with agencies