Swiss exports rose 1.5% in September to 23.2 billion francs, following their plunge in August. Over the same period, imports jumped by nearly a quarter to 21.9 billion, driven by incoming shipments of chemical and pharmaceutical products. The figures were published on Tuesday by the Federal Office for Customs and Border Security (FOCBS). The mechanical consequence: the month's trade balance shrank to 1.35 billion francs.
On the same day, the Federation of the Swiss Watch Industry (FH) published its own data for September. They show that watch exports are continuing the upward trend that began in June, with a surge in shipments to the United States that the FH attributes to a favourable base effect.
Swiss foreign trade in the third quarter
Across the third quarter as a whole, the FOCBS reports that the rebound begun in the second quarter has been confirmed. Exports rose 2.6% to 75.0 billion francs. Chemicals and pharmaceuticals, which account for more than half of the total, grew 1.6% to 39.3 billion, after a 15.7% rebound between April and the end of June.
The increase extended to other sectors: the machinery, electronics and equipment industry gained 3.1% to 13.7 billion, and watchmaking 4.7% to 6.7 billion francs.
On the import side, the quarterly increase was 1.8%, bringing imports to a record 61.0 billion francs. The value of imported energy products jumped 10.8% to 3.2 billion, after a rise of nearly 30% in the previous quarter. The trade surplus reached 14.0 billion, compared with 13.2 billion in the second quarter and 10.5 billion in the first.
Watch exports: the United States leads the gains
According to FH data, watch shipments to the United States rose 85.7% in September. Japan (+12.3%) and Hong Kong (+3.0%) also grew, while most of the other top 10 markets declined. China (−14.2%) and the United Kingdom (−5.2%) suffered, according to the FH, from an unfavourable base effect. Singapore (−8.3%) and the United Arab Emirates (−9.0%) were also down.
For the European Union, which posted growth of 15.5% overall, the FH urges caution. It notes that “the atypical situation observed in France (+128.2%) could in fact reflect shifts in flows between markets, to the detriment of other countries in the region”.
By price range, timepieces with an export price above 3,000 francs gained 9.9% and contributed significantly to the overall increase. All other segments also grew, particularly watches priced under 500 francs (+39.5%). In value terms, growth came mainly from bimetallic watches (+29.3%) and steel models (+13.0%). In volume terms, steel watches (+21.5%) and those made of other materials (+17.9%) together accounted for 81% of the pieces exported. In total, some 228,000 more watches were exported.
What the figures do not yet tell us
The two publications do not cover the same scope. The FOCBS figures cover foreign trade as a whole, with monthly and quarterly changes. Those of the FH concern watchmaking alone and are broken down by market. Neither of them comments on US tariffs. The FH explains the +85.7% to the United States by a base effect, that is, by a particularly weak comparison period. On its own, this figure therefore does not measure a lasting recovery in US demand, nor the effect of trade policy.
Jean-Philippe Bertschy, an analyst at Vontobel bank, also urges caution: in his view, these figures “nonetheless call for caution”. In a note, he stresses that “the ongoing unrest in France and Italy adds to the uncertainty regarding local consumption and tourism in these two markets which, together, represent the second-largest export destination”.
In China, a market with which Switzerland has concluded negotiations to optimise the 2014 free trade agreement, the latest decline reinforces, in his view, the cautious picture of demand. He nevertheless notes the first signs of order replenishment among suppliers, “which could indicate renewed confidence among brands”. He continues to expect a divergence between the major watch houses and the market as a whole.
