Switzerland’s economy faces GDP decline on Rhine; Low Rhine water disrupts cargo loading
NEWS: Hot Summer 2026: When water levels fall, so does GDP | unisg.ch
Why HSG? Why HSG? Overview Engaged community Great career opportunities Superb study programmes HSG Best Talents
Programmes Programmes Overview Bachelor Master Doctorate
Exchange programmes Exchange programmes Overview Incoming Guest Students
Get in touch Get in touch Overview Open Days & Exchanges Campus tours Fairs Offers for schools Services for businesses
Admissions Admissions Overview Admission Bachelor Admission Master Admission Ph.D. Additional Qualification Programmes Recognition of degrees Application deadlines Rematriculation
Studying at HSG Studying at HSG Overview Admitted – what’s next? Semester dates Course choice and exams Costs of an HSG degree Living in St.Gallen Courses
Costs of an HSG degree
Orientation Orientation Overview Advice and support Campus Uni ABCs
Research at HSG Research at HSG Overview Open Science Office Scientific Integrity & Research Ethics Research Support Research Services GSERM - Global School in Empirical Research Methods Prizes and Awards
Scientific Integrity & Research Ethics
GSERM - Global School in Empirical Research Methods
Faculty Faculty Overview Open Faculty Positions Faculty Portal Welcome Center Faculty Development Mid Career Programme Early Career Programme
Research units Research units Overview Schools Institutes Global Centers Centers Strategic research collaboration Transparency
Ph.D. Ph.D. Overview PhD Programme in Management (PMA) Graduate Programme in Economics and Finance (GPEF) Computer Science (DCS) Law (DLS) Organization Studies and Cultural Theory (DOK) International Affairs and Political Economy (DIA) Early Career Programme
PhD Programme in Management (PMA)
Graduate Programme in Economics and Finance (GPEF)
Organization Studies and Cultural Theory (DOK)
International Affairs and Political Economy (DIA)
Research in Focus Research in Focus Overview Elite Quality Index Circular Lab Consumer Spending in Switzerland
Career & Corporate Services Career & Corporate Services Overview Einzelberatung Karriere-Workshops Werkzeuge und Vorlagen Stellenplattform
Career & Corporate Services Overview
HSG Entrepreneurship HSG Entrepreneurship Overview HSG Entrepreneurship Services Ideation Incubation Acceleration Community About us Teaching
Insights and advice for partners from the world of work
Newsroom Newsroom Overview Special Topic HSG Entrepreneurship Special Topic Artificial Intelligence Special Topic Sustainability Media releases Newsletter
Events Events Overview Event calendar Öffentliche Vorlesungen Dies academicus HSG Graduation Days PhD Degree Award Ceremony St.Gallen Symposium START Summit
Publications Publications Overview HSG Focus Brochures Research Platform Alexandria
Video series Video series Overview Impact Awards In the Lab Knowledge Bank Art interviews Academic GIFts Little Green Bags
Podcasts Podcasts Overview HSG Student Podcast Grüezi Amerika. Views from the Sister Republic Meet the CFO HSG Research Insight SQUARE Talks Innovations in Sustainable Finance Machines That Fail Us
Grüezi Amerika. Views from the Sister Republic
About us About us Overview Vision, strategy and values Organisation History Rankings and accreditations Quality development Art at the HSG Advisory offices
HSG at a glance HSG at a glance Overview Numbers lab Research in focus The history of HSG at a glance
HSG at a glance Overview
The history of HSG at a glance
Engagement Engagement Overview Student engagement Responsibility and Sustainability Diversity & Inclusion Regional impact HSG Alumni HSG Foundation
Offers for the public Offers for the public Overview Public Lectures Children’s University HSG SQUARE Experiencing the HSG Info Desk and contact
Offers for the public Overview
Library Library Overview Search and Use Research and publishing Visiting and Studying Contact and Consultation
Schools Schools Overview School of Computer Science School of Economics and Political Science School of Finance School of Humanities and Social Sciences Law School School of Management
School of Economics and Political Science
School of Humanities and Social Sciences
Working at HSG Working at HSG Overview Jobs Working in administration Working in Academia Apprenticeship at HSG Life in Switzerland Entry from abroad: First steps
Entry from abroad: First steps
News Studying Research Executive Education Transfer News University
Newsroom Newsroom Events Publications Video series Podcasts
Background - 28.08.2026 - 10:00
Hot summer: When water levels fall, so does GDP
The hot summer of 2026 shows just how vulnerable the infrastructure on which our economy relies really is. This is particularly evident on the Rhine: historically low water levels are severely restricting the loading of cargo ships; a disruption to the uninterrupted freight link between Switzerland and the North Sea has become a realistic scenario. For Switzerland, this is not a distant German problem. Around ten per cent of imports reach the country via the Rhine ports in Basel-Kleinhüningen, Birsfelden and Muttenz. Energy sources, food and animal feed, building materials, raw materials and containers reach Switzerland via this key supply route. In 2025 alone, the volume of goods handled by waterway transport amounted to 4.7 million tonnes.
Ships at times loaded to only one-fifth of capacity
Restrictions on freight transport began long before this year. When the water level falls, ships must reduce their draught and thus their cargo. In August 2026, ships on parts of the Rhine were at times loaded to only around one-fifth of their usual capacity. At the bottleneck near Kaub, there was at times a risk of the Rhine effectively being “split in two”, thereby severing the uninterrupted link between the North Sea ports and the Upper Rhine. For supply chains, it is not just a question of whether a ship can still sail, but how much transport capacity remains along the entire corridor. If significantly more ships are required to carry the same volume of goods, costs rise – until there are simply not enough additional ships available.
When low water levels become an economic problem
2018 demonstrated the economic consequences that low water levels can have. According to calculations by the Kiel Institute for the World Economy, German industrial production falls by around one per cent if the water level at Kaub remains below 78 centimetres for 30 days.
In November 2018, the impact reached around 1.5 per cent. Raw materials and intermediate products at the start of industrial value chains are particularly affected. In 2018, BASF had to reduce production at its Ludwigshafen site after the supply of raw materials by ship had almost grounded to a halt for much of the third and fourth quarters. The company estimated the impact on earnings at around 250 million euros. The connection behind the headline is therefore to be taken quite literally: if the water level falls, transport capacity decreases. If this results in a shortage of raw materials and intermediate products, production output falls and, ultimately, so does economic output.
Rail and road cannot completely replace the Rhine
Part of the lost shipping capacity can be shifted to rail and road. However, the reserves for alternative transport routes are limited. On the roads, vehicles and drivers must be available; on the railways, free train paths, locomotives, wagons, train drivers and transhipment capacity are required. If large volumes are shifted simultaneously across an entire corridor, many companies will compete for the same resources.
The scale of this is illustrated by a comparison with a single vessel: typical Rhine vessels can carry around 3,000 tonnes of cargo – roughly the same as 120 fully loaded lorries, each with a payload of 25 tonnes. At the same time, considerable volumes are in transit every day: on the Lower Rhine near Emmerich, close to the German Dutch border, around 105,000 cargo vessel passages were recorded in 2024 – an average of just under 290 per day. On the Upper Rhine between Basel and Karlsruhe, there were a good 50 passages per day. Rail and road can absorb part of these volumes, but a complete replacement of Rhine shipping is hardly possible in the short term.
In addition to available capacity, economic viability also sets limits. This is because the less a ship can carry and the more it has to rely on scarcer alternatives, the higher the transport costs rise. In the case of bulk goods with a comparatively low value, the economic breaking point may be reached before transport becomes physically impossible. In the summer of 2026, the first steel and chemical companies reported production and logistics constraints – due to a lack of raw materials, limited transport options or sharply rising costs. Low water levels therefore do not become a problem only when transport becomes physically impossible: the economic breaking point may well have been reached beforehand.
Climate resilience does not end at national borders
In addition to alternative transport routes, the climate-resilient upgrading of existing infrastructure is therefore gaining in importance. On the Middle Rhine, the navigation channel is to be deepened by 20 centimetres in particularly shallow sections. During low water levels, this would enable an inland vessel to carry up to 200 tonnes more cargo. Such adaptations do not prevent extreme low water levels, but they can limit their impact on transport capacity. For Switzerland’s national supply chain, therefore, the focus on critical infrastructure does not end at the national border. Its reliability also depends on how efficient and climate-resilient key transport corridors in other European countries are.
What does the hot summer mean for industry and trade?
Heat and drought affect transport routes, water and energy supplies, the availability of raw materials and labour productivity – and thus the economic viability of businesses. The extent to which a company is exposed depends on the water and energy intensity of its production, the heavy and transport-cost-intensive intermediate products it requires, their origin, and its dependence on specific transport corridors. In the construction and agricultural sectors in particular, heat has a direct impact on productivity.
Bottlenecks propagate along the value chain. If a chemical company lacks a raw material, this will subsequently affect plastics, pharmaceuticals or machinery. In addition to higher transport and procurement costs, further costs arise from reduced plant output, underutilisation and restarting operations; delivery delays strain customer relationships. Maintaining additional stock therefore remains an important risk management measure. It can safeguard delivery capability, but increases capital tied up in stock and warehousing costs, thereby putting pressure on margins and competitiveness.
Efficiency or resilience – or both?
Reducing this situation to a choice between maximum efficiency and the highest possible level of redundancy is too simplistic. Small and medium-sized enterprises in particular cannot protect themselves against every possible disruption and must, at the same time, operate efficiently. They must make conscious decisions about which risks to take and where precautions are necessary – rather than being caught off guard by disruptions.
There are significant gaps here: according to the BME Logistics Study 2024, only 26 per cent of the companies surveyed have a dedicated function for supply chain risk management. Developing scenarios therefore remains a key task for company management. Critical dependencies must be identified – for suppliers and products as well as for transport corridors and modes of transport. Having two suppliers offers little security if both have to deliver via the same section of the Rhine. BASF illustrates what concrete precautionary measures can l