The Swiss Trade Surplus: A Really Global Economy

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George Dorgan
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The Swiss trade balance for goods clearly indicates its global orientation. Switzerland has a trade surplus with the US, Canada, the UK and many emerging markets. Swiss exports are mostly luxury products and pharmaceuticals. The total surplus for the 4 first months in 2013 was 7.7 billion CHF, about 1.2% of GDP, annualized around 4%.

Over the whole period from January to April 2013, the surplus decreased slightly when compared to 2012. Reason are the European austerity policy and weaker Chinese and Indian purchases.

The total current account surplus further includes foreign incomes and services. It is about 13.5% of GDP.

On the other side it imports many products, e.g. refined energy, preliminary goods or food from its neighbors and has therefore a deficit. As opposed to the U.S. or Japan, the Swiss do not have their own refineries, therefore they have a surplus with the Middle-East, but a deficit with the neighbors like Germany or Italy. Moreover many Swiss companies buy preliminary goods in Germany, build their own products and sell them around the world.

If you cleanout the surplus to Hong Kong (rather luxury items) with the deficit to China (rather manufacturing goods), then Switzerland has even a surplus with the whole Chinese state.

Both imports and exports have improved with the United States and the Middle East, while trade has considerably weakened with Japan, but also with Germany and the UK.The surplus increased with Canada, the US, the UK, Brazil, Germany, Japan and Australia, all countries that currently prefer not to do austerity. As for the trade with Spain, India, Hong Kong and China things are different, imports increased and exports contracted., the Swiss surplus has weakened.

Full data at Swiss customs (in German), or for more details our previous post on the Swiss surplus.

About George Dorgan

George Dorgan (penname) predicted the end of the EUR/CHF peg at the CFA Society and at many occasions on SeekingAlpha.com and on this blog. Several Swiss and international financial advisors support the site. These firms aim to deliver independent advice from the often misleading mainstream of banks and asset managers. George is FinTech entrepreneur, financial author and alternative economist. He speak seven languages fluently.

My articlesMy siteAbout meMy books
Follow on:LinkedINTwitterSeeking AlphaCFA SocietyEconomicBlogs