Our comprehensive assessment of Switzerland's operating environment and the outlook for its leading sectors are formed by bringing together a wealth of data on global markets that affect Switzerland, as well as the latest industry developments that could impact Switzerland's industries. This unique integrated approach has given us an impeccable track-record for predicting important shifts in the markets, ensuring you’re aware of the latest market opportunities and risks in Switzerland before your competitors.
Switzerland Country Risk
Steady Growth Ahead
The negative side effects of rapid Swiss franc appreciation in early 2015 have largely worn off with negligible lasting damage to the economy, and Switzerland is poised for stable real GDP growth in the coming quarters.
Switzerland's growth trajectory over the medium term will be increasingly powered by consumer spending.
The government's robust fiscal position implies it will be able to step in and boost growth in the event that any external shock puts a sharp break on Swiss growth.
The Swiss National Bank will keep refrain from cutting interest rates deeper into negative territory, and instead will continue to intervene in FX markets in order to prevent excessive franc appreciation. Beyond the next several...
Switzerland Industry Coverage (7)
Switzerland Commercial Banking
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BMI View: Limited public investment in infrastructure, combined with a mature power sector and an already-extensive transport network, means that growth prospects in the Swiss construction sector remain subdued. While we do expect to see a slight uptick in fixed capital investment, supported by strong domestic consumption trends, and note that the country's rail network is set to benefit from a surge in domestic and regional investment, overall there are few other major infrastructure projects in the pipeline outside of the transport sector. As such we expect to see only low single-digit growth in construction industry value throughout the forecast period between 2016 and 2025.
BMI View: By virtually all metrics - absolute size, penetration and density - both segments of Switzerland's insurance sector are extremely well developed. Both are dominated by world-class Swiss and continental European companies that have strong brands, multi-channel distribution, proven capacity to innovate and access to low-cost capital. However, we anticipate sluggish volume growth and downwards pressure on prices remain challenging for most sub-sectors of the non-life segment, while the life segment will be adversely affected by the effects of negative interest rates on investment portfolios.
Switzerland Medical Devices
BMI Industry View: We expect the Swiss medical device market to exhibit below average growth for the Western European region over the 2014-2019 period, with other medical devices and consumables registering the highest growth during this period. Further depreciation of the Swiss franc against the US dollar will be the main factor restricting growth in US dollar terms during the early part of the forecast period. Over the last 15...
Pharmaceuticals & Healthcare
Switzerland Pharmaceuticals & Healthcare
BMI View: Most of Switzerland's demographic and economic indicators are favourable towards increased pharmaceutical and healthcare spending. The pensionable population proportion is high and growing, and this will translate into greater demand for drugs. Furthermore, the country's highly developed infrastructure means that access to healthcare is easy, further supporting the consumption of medicines. Switzerland has one of the most expensive healthcare systems in the world, only behind the US.
Headline Expenditure Projections
Pharmaceuticals: CHF7.07bn (USD7.34bn) in 2015 to CHF7.09bn (USD6.89bn) in 2016; +0.29% in local currency terms and -6.1% in US dollar terms.
Healthcare: CHF73.62bn (USD76.47bn) in 2015 to CHF75....
BMI View: Switzerland's power sector will see some changes over the forecast period as the country shifts the balance of the power mix away from nuclear power and concentrates upon expanding non-hydropower renewable energy. As a result, we expect to see continued investment across several renewable energy sectors, including wind, solar and biomass, as well as the upgrade and expansion of existing hydropower facilities. Growth will be relatively slow, as lower power prices and limited consumption growth will continue to dampen investor interest. However, the government's ambitious renewable energy targets and commitment to the closure of nuclear power plants mean we do expect to see more projects entering the pipeline during the forecast period to...
BMI View: The Swiss telecoms market takes advantage of high-income households and a willingness to pay to top services which drive ARPU, but the dominance of incumbent Swisscom remains a concern. Price-cutting has failed with operators, including the new entrant Salt Mobile, competing on services, but Swisscom continues to call the shots, as highlighted by its move for convergence to consolidate its leadership in a saturated market.
There were 10.75mn mobile subscribers in Switzerland as of Q215, a y-o-y growth of 0.7%. Swisscom continues to dominate the market with a share of over 60%.
The incumbent reported 1.3mn bundles, 10.5% of its overall customer base, with 278,000 quad-play customers.
The move towards convergence has helped the incumbent in the pay-TV market, catching up with market...