Switzerland's industrial sector suffered a larger than expected downturn in the last quarter of 2001, according to the country's largest bank, UBS.This content was published on February 2, 2002 - 15:22
The latest UBS survey of 350 companies found that the current "sharp" downturn had yet to bottom out and warned of "distinctly bleak prospects" for the short term.
However, the Swiss economy, which has steadily lost momentum since autumn 2000, is expected to begin its recovery by the middle of the year at the latest, according to the report.
The survey found that companies in the industrial sector had scaled back production for the first time since autumn 1999, in response to a fall in orders received during the preceding quarters.
Sales in Switzerland and abroad were down on the previous year's results, with businesses reporting weaker earnings
With orders and backlogs on a downward curve, firms expect profits, sales and revenues to fall over the next few months.
Gross domestic product will probably shrink another 0.3 per cent over the first three months of 2002, said UBS. "No immediate stimulus is in sight, either from the domestic market or foreign sales."
The current downturn has hit every sector except the food industry, which focuses on the domestic market. The textile, plastics and machinery sectors are among those who have suffered most, because of their reliance on exports.
These companies are also handicapped by a near-impossibility of raising their prices, further reducing profit margins. None of the companies questioned for the survey say they expect to hire any new personnel, and only the watchmaking sector is counting on maintaining current staffing levels.
swissinfo with agencies
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