The International Monetary Fund (IMF) recommends Switzerland to continue its current fiscal policy to tackle new challenges for the country’s economy.

In its annual reviewExternal link published on Wednesday, the IMF said Switzerland recovered strongly from the pandemic last year, but uncertainties remained high amid risks of higher inflation and adverse spillovers from the war in Ukraine.

“Policies should continue to be agile in responding to these challenges,” a statement said.

The IMF also recommends careful planning and lower non-priority spending or higher revenues to address old age pension reforms, climate, defence and energy security as well as tax reforms.

“There is space for deficits, but the fiscal framework is robust and not easy to modify,” the IMF said.

The international institution consisting of 190 countries, reiterated that Switzerland held up well during the Covid pandemic, but financial sector risks were growing and should be closely monitored.

The IMF is projecting economic growth in Switzerland to continue above average, at 2.2% this year.

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