Swiss economy is booming! Pharmaceutical exports ensure surprising growth

Swiss economy is booming! Pharmaceutical exports ensure surprising growth

In the first quarter of 2025, the Swiss economy recorded a surprising growth of 0.8 percent compared to the previous quarter. This number exceeds the forecast of the State Secretariat for Economic Affairs (Seco), which had previously expected an increase of 0.7 percent. A central factor in this growth is the advance of pharmaceutical exports to the US, as companies such as Novartis and Roche exported their drugs and active ingredients to forestall possible tariffs under the US administration of President Donald Trump. This is particularly relevant after fears of increased tariffs have strongly influenced the export strategy of Swiss companies, such as 20 minutes reported.

The chemical-pharmaceutical industry made a significant growth contribution of 0.8 percent to the gross domestic product (GDP). Looking at the figures for the first three months of the year, the industry grew by an impressive 7.5 percent, boosted by increased exports to the USA. Other sectors such as construction and services also recorded positive developments. The service sector grew by 1.4 percent and trade, supported by wholesale and retail, recorded an increase of 2.1 percent.

Challenges for the industry

However, the mechanical engineering and watch industries are faced with sales difficulties. Combined with these challenges, there was a negative growth contribution of -0.4 percent for the entire industry if the pharmaceutical industry is not taken into account. Energy production also suffered from the warm winter, resulting in a decline of 9.4 percent.

The GDP figures are adjusted for sporting events and show overall unadjusted growth of 0.5 percent. The Seco has raised its annual forecast for 2025 to growth of 1.0 percent, although the possible impact of tariffs threatened by Trump was not taken into account in this forecast. Economists consider the forecast to be realistic and expect solid, if not excessively strong, growth.

Market developments and outlook

There are also increasing trends in imports, with an increase of 6.1 percent. Investment in equipment and construction also increased, with construction investment increasing by 0.8 percent and value added in construction increasing by 1.1 percent. At the same time, government consumption showed growth of 0.4 percent.

Another important aspect is the Swiss National Bank's upcoming decision on monetary policy, which will take place on June 19, 2025. An interest rate hike of -0.25 percentage points is considered likely and could have a decisive impact on further economic stability.