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IMF urges Swiss to step up recession fight

The International Monetary Fund (IMF) says Switzerland may need another stimulus package as the economy slips into a "significant" recession in 2009.

According to a yearly report the IMF released on Tuesday, researchers project that Switzerland’s economy will shrink three per cent on downturns in exports and troubles in the country’s financial sector.

“Given Switzerland’s openness and the size of its financial sector, the economy is projected to experience a significant contraction in the near-term with sizable downside risks to the outlook,” the IMF wrote in an annual review of the country.

The forecast is in line with those from other economic observers. The KOF Swiss Economic Institute in Zurich earlier this month said a dramatic downturn was indeed likely. It noted that exports, a key sector for Switzerland, were 14 per cent lower in the first quarter of 2009.

Researchers at the Créa Institute of Applied Macroeconomics at Lausanne University have predicted the economy will contract 3.2 per cent in 2009 and 0.8 per cent in 2010. with agencies

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SWI - a branch of Swiss Broadcasting Corporation SRG SSR

SWI - a branch of Swiss Broadcasting Corporation SRG SSR