Swiss plan to tame effects of strong franc with €1.75bn investment
Euro DEBT CRISIS
Published 18/08/2011 | 05:00
THE Swiss government is proposing a new €1.75bn investment package in an effort to stop its soaring currency harming the home economy.
Switzerland is battling the effects of a fast rising currency as the euro and dollar plunge on debt fears and the Swiss franc is pushed higher by nervous investors buying the currency as a safe haven.
Even globally diversified companies like drug firm Roche and watchmaker Swatch Group have started to report an impact on earnings, while the franc is also weighing on the country's banking sector.
The government now plans to invest €1.75bn in the export, tourism, innovation and research sectors, in a bid to shield the economy from the soaring currency, which has risen to one record after another against the dollar and the euro this year.
Swiss finance minister Eveline Widmer-Schlumpf said the government would support any measures the Swiss National Bank said were necessary in the battle against the strong franc. "We support anything that can be done against the strong franc," she said.
The franc briefly strengthened to 1.1346 against the euro after the announcement, from 1.1462 per euro just before. It then eased back to 1.1413.