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More stimulus for the Swiss economy?

Swiss Finance Minister Hans-Rudolf Merz says the country may need a third economic stimulus package if the economy fails to recover in 2010.

The government announced a stimulus package of about SFr650 million ($588.63 million) on Tuesday, its second to counter the crisis, as it forecast Switzerland was heading into its worst recession since 1991.

The State Secretariat for Economic Affairs (Seco) said the economy would shrink by 0.8 per cent in 2009, but recover in 2010 with 1.0 per cent growth.

"I won't venture a forecast but I have no reason to doubt that of Seco," Merz said in the weekly Sonntag newspaper.

"If the forecasts are not accurate then we would have to launch a third support package in certain circumstances."

Merz declined to comment on the size of a possible third package, but said it could be put together relatively quickly.

On Saturday, Seco's chief economist, Aymo Brunetti, acknowledged that the forecast for 2010 was uncertain.

Brunetti was quoted in the Bund newspaper of Bern as saying that economic forecasts for the next two years were "almost in the realm of science fiction".

Brunetti said it was not impossible that the economy would rebound in the second half of 2009 but it was not certain.


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