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How Covid affected the Financial Situation in Switzerland

 

In the beginning of 2019 when the first cases of Covid-19 were detected in Europe, the world stopped. Causing many uncertainties all over the world, stopping mass production of items, and affecting people´s day-to-day lives and overall health. With a virus never been discovered before, and medical teams all around the world meeting and trying to understand what exactly we are dealing with caused great chaos in the overall world´s economy. Closing businesses, creating high levels of unemployment due to businesses cutting down costs in order to survive and among any other difficulties businesses had to face. Due to this many industries were seriously impacted, however in the other hand, there was new opportunities emerging especially in the technology sector that made groundbreaking discoveries.

 The Top 5 most Impacted industries affected by covid are: 

 The Top 5 least Impacted industries affected by covid are:

 

1      Airlines

Construction

2.     Oil and Gas Drilling

Finance and Insurance

3.     Apparel Retail

Wholesale and Retail

4.     Home Furnishing Retail

Real Estate  

5.     Tourism

Transport and Storage  

 

The 7 largest economies in the world were drastically affected some in a positive and others in a negative way. The GDP growth rate is the following (2020):

  1. China: grew by 4.9%
  2. United States of America: declined by 2.9%
  3. France: declined by 3.9%
  4. Germany: declined by 4%
  5. Japan: declined by 5.7%
  6. India: declined by 7.5%
  7. United Kingdom: declined by 9.6%

 

Switzerland’s international economy has been affected by government measures taken around the world to contain the COVID 19 pandemic. The impact of these measures on the world economy and international trade is a concern. The economy shrank 2.9% last year (2020) as a result of Covid 19, the worst annual decline since the aftermath of the 1975 oil crisis.

Despite the situation, Switzerland has mastered the crisis from an economic perspective in international comparisons. With a global decline in gross domestic product of 4.2%, comparing to the expected fall in the euro area of 7.5%.  From this point of view, the Swiss economy seems to have survived the pandemic better than bordering countries and many others. The steps taken by the Union, Canton, and Commune to support the domestic economy have helped prevent an even more severe economic downturn.

The sectors that were hit hardest in Switzerland last year were, of course, the hospitality industry (20.8%) and the arts and entertainment and leisure (7.7%). In 2020, household spending fell sharply as stores, restaurants, bars, and leisure facilities closed. Another factor is the unemployment rate, which has risen to 3.7% by the end of January this year.

The Swiss economy is expected to grow at an above average 3.3% growth rate in 2022, and the rise will continue next year, as the government stated. However, with the fear of the new wake forming due to new variants the Swiss economy might take another downturn. As the restrictions are tightening, with the government imposing entry restrictions on the country, the fear of the country closing down begins to rise. Consequently, if the government decides to close down the country again, the economy will begin to fall.

However, despite covid and all restrictions that come along with it, Switzerland is still one of the best countries to live in and comparing to all its neighbouring countries and majority of countries in Europe, it is dealing with the covid situation better, and it remains as one of the most developed. With breath-taking views, balanced lifestyle, Switzerland is still the place to be in.