Swiss economic growth slows in Q4 as exporters struggle

[ZURICH] Swiss economic growth slowed to 0.3 per cent in the fourth quarter of 2019, the government said on Tuesday, as exports fell and industry struggled.

The increase meant the Swiss economy grew 0.9 per cent during 2019, the State Secretariat for Economic Affairs (SECO) said, the lowest since 2012 and well below the country's long-term average growth rate of 1.7 per cent.

Quarter-on-quarter growth in the final three months was a slowdown from the 0.4 per cent level in the third quarter. Manufacturing was flat, with the previously strong chemicals and pharmaceutical industry unable to compensate for difficulties in the machinery and metals sectors.

SECO made no reference to the impact of the coronavirus on the Swiss economy, although an official from the department said on Saturday he expected it to lower its economic forecast for 2020 due to the outbreak.

The previous forecast was for the Swiss economy to grow 1.7 per cent in 2020, with a new update expected on March 17.

Export-dependent Switzerland borders Italy, the centre of Europe's worst outbreak of the disease, and has had 30 confirmed cases so far of the disease.

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Switzerland has joined countries banning big events to try to curb the epidemic, forcing cancellation of the Geneva car show, one of the industry's most important gatherings.

During the fourth quarter, SECO said manufacturing had been flat while exports fell by 0.5 per cent. The slowdown reflected difficulties in neighbouring Germany, Switzerland's biggest export market.

"Although the chemical and pharmaceutical industry bolstered overall economic growth, it could not quite repeat the fast pace of previous quarters," SECO said.

REUTERS