After a weak 2015, economic growth is projected to strengthen gradually as domestic demand receives support from negative interest rates and increasing real wages. With the currency stabilising over recent months and oil prices recovering, consumer prices should turn up during 2017. After a recent rise, unemployment will start to fall in 2017, but the outsized current account surplus will persist.
The budgetary situation is sufficiently sound to withstand a downturn or any foreseeable medium-term challenges. Monetary policy settings are appropriate, but continued vigilance on the housing market is required. The government needs to be careful in implementing immigration quotas to avoid damaging its relationship with the European Union.
While the level of labour productivity is high, its slow growth over the past decade should be actively addressed. Competition in the telecoms and energy sectors needs to be sharpened. Support to agriculture should be further curtailed, and more free-trade agreements should be concluded. Greater female market employment should be promoted to increase inclusiveness and ensure that womens’ skills are utilised fully.
Economic Survey of Switzerland (survey page)
The Economic Consequences of Brexit: A Taxing Decision (main web page with paper)
Structural reforms in a difficult time (blog + paper)
Public spending efficiency in the OECD (blog + paper)