Vaud GDP: robust growth despite a further deterioration in the outlook

Posted 21 April, 2022

The recovery should continue this year and next year for the Vaudois economy, despite global growth hampered by the war in Ukraine. The latest forecasts expect the gross domestic product (GDP) to rise by 3.2% in 2022. Although down from the 3.6% expected at the start of the year, growth should therefore remain solid. In 2023, GDP is expected to grow by 2.5%, according to the latest CREA values, published by BCV, the State of Vaud, and CVCI. The degree of uncertainty remains very high; in particular, the consequences of the conflict in Ukraine, the effects of supply chain disruptions, and the impacts of the rebound in inflation on the global economy are difficult to anticipate.

As much as the risks for the economy linked to the Omicron variant and to the COVID-19 pandemic have rapidly diminished in many regions of the world – with the notable exception of China –, the return of uncertainty has been sudden with the start of the war in Ukraine. Disruptions in logistics circuits as well as the rise in commodity prices and inflation have been exacerbated. Prices rose 8.0% in the first quarter in the United States and 6.2% in the eurozone, according to initial estimates. In Switzerland, the rise in the franc tempered inflation, which stood at 2.1% over three months. The American and European central banks could tighten their monetary policy more quickly than expected and the Swiss National Bank could follow suit.

While still favorable, the global outlook has deteriorated significantly. In its April forecasts, the International Monetary Fund (IMF) expects global growth of 3.6% in 2022, against 4.4% three months earlier. At the national level, the latest forecasts from the State Secretariat for Economic Affairs (SECO) call for a GDP increase of 2.8% in 2022, 0.2 percentage points less than previous forecasts. For 2023, the forecast is stable at 2.0%. With growth expected at 3.2% this year and 2.5% next year, the canton of Vaud compares favorably.

Forecasts should be viewed with caution due to the high degree of uncertainty, particularly related to the conflict in Ukraine. The risk of seeing new variants of the Sars-Cov-2 virus compromise control of the pandemic also remains. The level of indebtedness of certain countries could also slow down the recovery. As far as Switzerland is concerned, other risk factors lie in the possibility of a further appreciation of the franc, the uncertainty linked to the development of relations with the European Union (EU), or the implementation of a global minimum tax for businesses.

At the branch level, after a broadly shared dynamic rebound in 2021, the recovery should continue for the majority of them. Chemicals-pharmaceuticals, as well as real estate activities and business services, should show strong growth (more than 2%) this year and next year. The hotel and catering industry is in the same situation, which reflects a catch-up, despite the obstacles still present, after the collapse of inactivity in 2020. In transport and communications, strong growth in activity in 2022 could leave the place for moderate growth (from 0.5% to 2%) in 2023. Conversely, in trade, moderate growth is expected this year, followed by a strong increase in activity next year.

Public and parapublic services could grow moderately in 2022 as in 2023. In the machinery and watchmaking industry, after moderate growth this year, a moderate decline in activity (between -2% and -0, 5%) is possible next year. As for financial services and construction, they could see their activity decline moderately in 2022, then experience moderate growth in 2023.




GDP is an essential indicator for assessing the dynamism of an economy. Vaud's GDP has been published since 2009. To guarantee a rigorous and transparent calculation, the BCV, the State of Vaud, represented by the Department for the Promotion of the Economy and Innovation and Statistics Vaud, as well as the CVCI have mandated the CREA Institute of Applied Economics of the HEC Faculty of the University of Lausanne. CREA's methodology notably incorporates cantonal GDP estimates from the Federal Statistical Office. Since January 2019, the data has been corrected for the effects of major international sporting events.

Vaud's GDP is published four times a year (next publication: July 2022). Managers of the private economy and political decision-makers thus have access to up-to-date data and forecasts at all times, in order to be able to better prepare their decisions and steer their projects.

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