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The Eurozone crisis and the implications for multinationals in Europe

Is your European holding in Switzerland prepared for the different scenarios at hand?

The Eurozone crisis and the potential impact in the event of a full scale sovereign debt default by one or more of the afflicted nations has continued to dominate the economic landscape in Europe. In a recent Deloitte CFO Survey, the crisis was highlighted as the CFO community’s greatest concern, affecting consumer and business confidence and limiting the pace of recovery from multiple years of stagnation and recession.

The continuing efforts by the European Central Bank to assuage the markets and build confidence within the political and economic communities have so far avoided the outbreak of an uncontrolled crisis. These actions should not, however, be interpreted as a sign that all is well. If anything, there is the danger that they have masked the underlying problems. The evolution of inflation levels, discrepancies in competitiveness, the wide fluctuation of key exchange rates, and a return to recession within the Eurozone economies are reason enough for the management of your holding company to consider the potential impact should events take a dramatic turn for the worst.

It is within this continually evolving context that business leaders must prepare contingency plans that both take into account a “worst case” scenario arising from a sovereign debt default together with an exit of one or more countries from the Eurozone, and at the same time deal with the accelerating slowdown in economic growth. These scenario analyses and plans entail a balanced assessment of commercial, tax and legal risk and opportunities in light of the diverging interests of holding companies and their subsidiaries. While CFOs included within our survey continue to cite cost reduction and increasing cash as priorities for their businesses, an increasing focus on driving profitable growth is a growing priority. May be it is also an opportunity to optimise your footprint across Europe?

The Deloitte Eurozone experts can prepare you for the uncertain future. We therefore have developed an Eurozone handbook  to help you to cope with the strong Swiss Franc.

Did you ask yourself the right questions? 

Why Deloitte?

Here are some of the reasons to choose us as your advisor:

  • Our dedicated Deloitte Switzerland Eurozone experts have substantial project experience in:
    • strategic scenario planning
    • risk-adjusted forecasting and simulation
    • cash management / debt advisory and capital raising
    • sourcing, product life cycles, supply chain and innovation
  • Deloitte is ranked as the leading provider of pricing and profitability management solutions
  • Proven implementation capability when and where you need it most
  • We have a strong track record with Swiss and international / listed companies and privately held clients
  • We have worked with many stakeholder groups throughout the life cycle of projects, Swiss based and across Europe in particular
  • A global network to help you where you are

More Research and Insights

  • The Deloitte CFO Survey - 2012 Q4 results
    Swiss CFOs view the growth potential of foreign markets as an opportunity in 2013. In contrast to recent years, however, these are not only in Asia, but increasingly in the US.
  • The Deloitte CFO Survey - 2012 Q3 results
    The uncertainty among Swiss CFOs remains. Optimism and pessimism are fairly balanced. It is hard to predict which factors will prevail so the search for the right direction continues.
  • The Deloitte CFO Survey - 2012 Q2 results
    The results of the CFO Survey reflect ongoing global uncertainties. Growth in the United States is higher than in Europe, but will the US finally manage to revive its job market?

Further information

  • CFO Survey website
  • Interview with Swissmem President Mr Hess on strong Franc
    Sonntagszeitung, 13 May 2012 (article in German)
  • Uncertainty in the euro zone
    Tax planning for a changing environment

Key contacts

  • Markus Koch
    Partner, Zurich +41 (0)58 279 61 33
  • Jan-Dominik Remmen
    Partner, Zurich +41 (0)58 279 64 32
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