ZURICH (Reuters) - Switzerland plans to ease restrictions now in place to combat the new coronavirus starting at the end of April, the government said on Wednesday, adding the economic damage from the epidemic could be the worst on record.
“The government knows that our people, our families, companies, employees and self-employed people need a vision for the future, and they need it quickly,” President Simonetta Sommaruga told a news briefing.
She said the uncertainty was taking its toll on people, locked down at home for nearly three weeks as schools and businesses were shuttered, town squares deserted and trains and roads emptied of people.
The government said it would extend existing anti-coronavirus restrictions for another week to April 26, before looking at a gradual loosening of measures that now include border controls, restaurant closures and bans on gatherings of more than five people.
Sommaruga said the population had largely followed the restrictions.
“We are on the right path, but we’re not yet at the finish line,” she said, urging continued hand-washing and social distancing measures.
Switzerland could suffer its worst economic downturn on record, the government said, with the coronavirus epidemic shrinking the economy by as much as 10.4% this year.
The scenario, far worse than the government’s previous forecast of a 1.5% contraction, would occur if there was a prolonged shutdown in Switzerland and as well as abroad, triggering bankruptcies and job cuts across a nation dependent on world trade.
In such a scenario - far worse than the downturn in the 2009 financial crisis - there would only be a weak recovery with the economy forecast to grow by 3.4% in 2021.
In a second, less-dramatic scenario, the Swiss government reckoned with a contraction of 7.1% before a stronger bounce back come 2021.
The human cost of the virus has also continued to rise, with Switzerland’s death toll rising to 705 and the number of positive tests reaching 22,789, the public health department said.
Neighbouring Austria, which is preparing to relax its own restrictions after Easter, has already lost 2.8% of its economic output in the crisis.
Switzerland has already launched a 62 billion Swiss franc ($63.85 billion) aid package, its largest economic rescue plan ever, to assist companies with short time working compensation and loan guarantees.
On Wednesday it extended the prospect of bridging loans to the aviation sector which has been hard hit, with flights to and from Swiss airports down 95%. The skies over Switzerland, like much of the rest of the world, are nearly empty of planes.
The economy has been shaken by the virus and restrictions introduce to keep it from spreading, Economic Affairs Minister Guy Parmelin said, with nearly a third of the country’s workforce on short-time work and jobless ranks on the rise.
“The scenarios...are gloomy,” he told reporters. “The health impact of the coronavirus has been a concern for the Swiss government, but so has the effect on the economy. It’s important we all do everything so that people in this country can work, despite the virus.”
Reporting by John Revill and Brenna Hughes Neghaiwi, additional reporting by John Miller