Exports fuel Swiss economic growth

Despite a sluggish global economy, the wheels of the Swiss economy are turning Keystone

The Swiss economy continued to grow during the third quarter of the year, despite a slowdown in consumer spending.

This content was published on November 26, 2004 minutes

While the global economy remained sluggish, growth in the export sector fuelled a 0.4 per cent rise in Switzerland’s gross domestic product (GDP).

The State Secretariat for Economic Affairs (Seco) said on Friday that exports of goods rose by one per cent from July to September, while imports increased by 2.5 per cent.

“Economic expansion in Switzerland is expected to continue in 2005,” said Seco in a statement.

“Continuing positive impulses from exports are [now] more important given the weaker development of private consumption.”

Consumer spending slowed during the third quarter, gaining just 0.1 per cent. Figures show that clothing and furniture sales fell during the period in question.

Investment in the construction industry rose by nearly one per cent, as the market for new homes picked up.

Not unexpected

The latest figures are in line with analysts’ expectations.

Jan Poser, chief economist at Bank Sarasin, said the figures showed that growth was “slightly levelling off”.

“That’s in line with the data we’ve seen from Europe showing that the growth impulse has been a bit less broadly-based since the middle of the year.”

According to Seco, year-on-year growth stands at around two per cent, with economic expansion set to continue next year.

But government experts warn that growth may be hindered by a sluggish economic performance in the neighbouring euro zone.

Seco added that the weak dollar as well as an increase in the price of petrol could put the brakes on the Swiss economy - a view shared by analysts.

“Growth will continue, but one has to see that the slowdown will also continue, partly because of the weaker export situation in the United States,” said Poser.

swissinfo with agencies

In brief

Economic growth was 0.4 per cent during the third quarter.

Year-on-year growth was two per cent.

Consumer spending dropped, while exports of goods rose.

Seco expects growth to continue next year, while the job market should improve.

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