The Organisation for Economic Cooperation and Development (OECD) has revised its growth forecasts for Switzerland downwards for the next two years due to a global economic slowdown.
After a strong 2018 (+2.5%), gross domestic product (GDP) growth should slow in 2019 (+1%), the OECD said on Tuesday. This compares to its earlier forecast last November of +1.6%.
The situation should improve in 2020 (+1.5%) as global trade recovers, the Paris-based policy forum said.
Household consumption in Switzerland should gradually pick up (+1.2% and +1.5% for 2019 and 2020, respectively). Meanwhile, exports are expected to stagnate this year before recovering in 2020 (+3.4%).
Price inflation should remain modest over the next two years, 0.5% and 0.7%, respectively, which are well below the Swiss National Bank objective of 2%.
OECD said a lack of skilled workers, particularly in the technical, scientific and computer fields, remains a problem for Swiss-based companies and the number of unfilled positions continues to rise. At the same time, immigration is slowing, and the Swiss population is getting older.
The forum recommends greater efforts to encourage more women to study science, technology and engineering, as well as increased immigration levels from non-EU countries.
The global economy is expected to grow by only 3.2% this year as growth in trade flows is nearly halved this year to only 2.1%, the OECD said in its biannual outlook.
It said economic growth in China and the United States could be lower by 2021 and 2022 if the two countries do not end their tit-for-tat tariffs in their dispute that has dampened the global economic outlook.
The global trade slowdown has also taken a toll on the euro zone, with expected growth this year at 1.2% before rising to 1.4% in 2020.