The Swiss government lowered its economic growth projections for 2025 and 2026 this week, as the export-driven economy prepares for the effects of ongoing global trade tensions.

Once seen as one of Europe’s most resilient economies, Switzerland is now expected to grow by 1.3% in 2025, down slightly from the 1.4% forecast made in March.

The State Secretariat for Economic Affairs (SECO) also revised its 2026 growth outlook downward to 1.2%, compared to the earlier estimate of 1.6%, citing anticipated declines in exports, Reuters reports.

Both revised figures, adjusted to exclude the impact of major sporting events, fall short of Switzerland’s average growth rate of 1.8%.

“Uncertainty regarding international trade and economic policy remains high and is shaping the outlook for both the global and Swiss economies,” SECO stated.

While Switzerland experienced solid economic growth earlier in the year, much of it was fuelled by exporters accelerating shipments in anticipation of impending US tariffs.

“Performance is expected to weaken significantly for the remainder of the year,” SECO went on to add.

Additionally, the KOF Swiss Economic Institute has also downgraded its outlook for Switzerland, lowering its 2026 growth forecast from 1.9% to 1.5%.

KOF cited rising uncertainty among businesses due to what it described as the United States' “erratic trade policy.”

This comes after Washington imposed a 10% tariff on Swiss exports, following the temporary suspension of an earlier proposed 31% import duty.

Alexander Rathke, head of Swiss economic forecasting at KOF, warned that if the higher 31% tariff were ultimately implemented, Switzerland could face a mild recession in 2025.

“Not only would Swiss goods become more expensive in the United States, but they would also be more expensive than those from other countries with lower tariffs,” Rathke commented.

“For many products it would not be worth exporting anymore,” Rathke added, who described the likelihood of the higher tariff being imposed as “very low.”