Horizon Insight, a global analytical team of experts that helps governments and businesses transition towards the future, ranked Switzerland as 4th best-positioned economy to rebuild post Covid-19.
The recent white paper notes that that there were wide differences in the effect of COVID-19 on each country’s economic and socio-political situations. The stringency and duration of containment measures had an important factor impact on industries and jobs. Given the way individual countries handle these differences, the recovery pace will not be symmetric or simultaneous.
The COVID-19 Economic Recovery Index (CERI) created by Horizon Insight looks at how 122 countries are positioned and measures their capacity to recover based on their overall resilience, and structural strengths and weaknesses.
The index measures the extent of risk exposure to the pandemic and the degree to which countries have the right institutions, policies and factors in place to recover to pre-COVID levels.
The report lists the top four ranked countries as: Finland, Norway, Germany and Switzerland. The key areas on which these countries have built their capacity to recover are:
- workforce adaptability
- highly digitalised economies
- governance and social capital
- well-functioning financial systems.
Among the wealthiest countries per capita, Norway (3) and Switzerland (2) are positioned in the top 10 of the CERI Index, while Finland (14) and Germany (16) are not far behind. Although wealth per capita was not considered an underlying factor for recovery it is linked to Government spending: Switzerland is in the list of countries ranking highest for government support, with a series of federal-level support packages amounting to a total of CHF73 billion (10.4 percent of 2019 GDP).
The IMF recently stated that it expects the global economy to contract by 3% in 2020, which it says would be “the worst recession since the Great Depression” of the 1930s – far worse than the financial crisis of 2008.
What is the realistic outlook for Swiss economic recovery? According to the IMF study, top ranked countries combine world class governance with high levels of social capital and high social resilience. These also have strong financial systems, manageable debt levels and good health system resilience.
Ranked 4th overall in the CERI, Switzerland achieved first place for economic resilience and for labour market agility, two key metrics. Switzerland’s strong international links are an asset for the recovery process, and it’s main trading partners are expected to recover well from the pandemic. However this dependency predisposes an inter-related recovery rather than a solo effort.
The COVID-19 crisis will probably accelerate economic transformation trends – especially digital transformation. In Switzerland there remains a large and growing gap between the number of vacant IT positions and the local talent available to fill them. The reliance on skilled digital specialists from international markets remains and will become more important in future.
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