2. The political structure of Europe is vastly
changing before the very eyes of many
long time citizens and patrons. For the
most part, the British vote to leave the
European Union (Brexit) has not been
good news for most of the European
countries.
3. With many downturned economic
trends forecasted for the next few
months, the minds of many are filled
with doubt. In regards to Switzerland,
there are many impacts that the Swiss
will feel, that hit uncomfortably close to
home. Here are 3 ways the Brexit vote
affects the economy of Swiss.
5. As a result of the Brexit vote the Swiss
franc has rose sharply overnight, which
has caused the government to step in
and curb the spike. This is bad news for
Swiss exporters, who are now forced to
squash costs while cutting their prices as
this is the only way for them to remain
competitive at this point in time.
6. The franc has been known to be a fairly
stable investment and has gained that
reputation over the past years and has
been known as a flagship for many
investors. However, that reputation is at
stake now with the increased volatility
approaching. It is predicted that in
order to get the franc back to normal
will have a devastating impact on
interest rates.
8. Stock Markets as a whole are down all over
the world, but more specifically the Swiss
Market Index (SMI) has toppled by more than
5% which crushed the large Swiss Banks. UBS
shares were down 9% as of Friday morning
and Credit Suisse, a staple in the banking
industry, saw more than 10% of it’s value
wiped away. Although these were major hits
to start a Friday morning, the market has
begun to climb back, but the damage has
already been done.
10. The Swiss have been in negotiations with the
European Union to decide on legislation in
regards to curbing the immigration to
Switzerland. This legislation is to help combat
the fact that the Swiss simply cannot keep up
with the constant inflow of immigrants to their
country. The negotiations have been thrown
into turmoil once before in 2014, resulting in
an angry Belgian government.
11. However, with Brexit turmoil on the rise these
negotiations are sure to be throw into disarray
again, alluding to the fact that they may not
reach the concrete February deadline. This
deadline is crucial to the swiss economy
because immigrants are here to work, but the
country is approaching a deficit in housing and
employment.
12. Final Thought
With most of the world in turmoil, the Swiss
are no exception to that statement. However,
with a fairly distant connection to the
European Union, the Swiss should reach
equilibrium once again, but it is going to take
some time.