EU-Switzerland relations from an economic angle: Insights from our economist Christiane Von Berg
Christiane is the Chief Economist for the DACH and BeNeLux region at Coface.
During the conference, she discussed the results of studies that estimate the effects on trade between the two parties under different scenarios. The expert’s conclusion was that “both sides would benefit from a new agreement”.
According to the study, foreign trade would increase by 10 per cent overall if the existing bilateral agreements were updated with the latest provisions of the CETA agreement, the EU's trade agreement with Canada.
Conversely, in a scenario in which Switzerland and the EU are without an agreement - i.e. with the status of a WTO third country - trade would decrease. In the hypothetical maximum scenario of Swiss EU membership, trade would increase by up to 25 per cent. However, the social and other costs are neglected in this study. In terms of the current trade situation, the EU is Switzerland's most important partner; Switzerland ranks fourth in the EU in terms of goods exports and sixth in terms of goods imports.
Overall, Switzerland is rated as low risk at A2 in the current Country and Sector Risk Barometer for the third quarter of 2023. Of the 162 countries surveyed, the risk is only “very low” (A1) in Norway, while the majority of European countries are rated A3. “The developed economies are not performing well,” said Christiane. This is one of the main reasons why global economic growth is expected to be 0.2 percentage points lower in 2024 at 2.2 per cent, according to forecasts. However, developments in China and the US give reason for hope.
According to Christiane, Switzerland is already seeing better figures, but good growth momentum is being observed. It is stronger than in the rest of Europe, similar to that in the USA. As global trade picks up again, the luxury sector could also benefit. “Another positive aspect is that Swiss inflation was at times the lowest compared to the 40 most developed economies in the world.”
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