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SME Export Indicator: Optimism and New Markets

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Swiss SMEs are starting off the new year with confidence. A survey of 217 Swiss companies conducted by Switzerland Global Enterprise (S-GE) reveals that almost a third of them want to expand into distant markets, while Europe remains very important for their exporting activity. Germany, the USA and France are the most significant export markets for Swiss SMEs, according to the survey results. The Credit Suisse Export Barometer indicates that the German and US markets are developing favorably, but that the outlook for exports to France is dimming.

The Credit Suisse Export Barometer, which tracks foreign demand for Swiss products, currently stands at a level of 1.02, which is slightly above both the long-term average and the prior quarter’s reading. The S-GE SME export outlook index reading of 65.4 points for Q1 2015 is pointing much more strongly to expanding exports than it was in the previous quarter (60.8).

"The USA is the most important export growth driver at the moment due to the dynamic recovery of the US economy and the strengthened US dollar’s parity against the Swiss franc", says the economist Lukas Gehrig from Credit Suisse Economic Research. "The prospects for exports to the Eurozone remain mixed, in contrast. Germany is still sending rather positive signals, but production declines in Italy and France are pointing to a deterioration of export prospects."

Europe Remains Important

What are Swiss SMEs planning in light of this market climate? "Almost a third (31 percent) of the SMEs surveyed by us want to begin exporting to distant markets. Countries in the Asia-Pacific area are the most frequently cited export destinations (by 61 percent of the SMEs surveyed)," explains Alberto Silini, the Head of Consulting at S-GE. "But we also notice just how important Europe still is. A quarter (26 percent) of Swiss SMEs want to gain a foothold in additional markets in Europe over the next six months. We think it is very advisable to diversify export markets this way because this disperses risk and enhances growth opportunities."

As in the prior quarter, 92 percent of the SMEs surveyed by S-GE look set to export to Europe over the next six months, though France and Italy were cited less frequently than in Q4 2014 (52 percent and 40 percent, respectively, versus 61 percent and 45 percent a quarter earlier). Furthermore, Asia is gaining greater importance as an export region (Q1 2015: 57 percent; Q4 2014: 54 percent). As in the prior quarter, 41 percent of the SMEs surveyed intend to export to the USA and 46 percent to North America. The Middle East and Africa remain unchanged at a citation rate of 28 percent each, as does South America at 19 percent.

Further information on the SME Export Indicator for the first quarter of 2015 is available on the website of Switzerland Global Enterprise. The SME Export Indicator for the second quarter of 2015 will be published on April 16, 2015.

Methodology of the Credit Suisse Export Barometer

The Credit Suisse Export Barometer takes as its basis the dependence of Swiss exports on foreign export markets. In constructing the export barometer, we have drawn together important leading industry indicators in Switzerland's 28 most important export countries. These indicators generally have a forecast horizon of approximately one to two quarters. The values of these leading indicators are weighted on the basis of the share of exports that goes to each country. The export barometer consolidates this information to produce a single indicator. Since the values in question are standardized, the export barometer is calibrated in standard deviations. The zero line corresponds to the growth threshold. The long-term average growth of Swiss exports of approximately 5 percent is 1.

For more detailed information: Credit Suisse (2009), External Trade Switzerland – Facts and Trends, Swiss Issues: Industries, available at

Methodology of the SME Export Outlook Indicator of Switzerland Global Enterprise

The SME export outlook indicator is based on the quarterly survey of a fixed panel of more than 200 Swiss SMEs representing the pharmaceuticals/chemicals industry, machinery, consumer goods, the metals industry, paper, electrical engineering, the precision instruments industry, as well as services. SMEs indicate whether they expect growth, stagnation or a decline in exports for the current quarter as well as the coming one. To emphasize the forecast nature of the SME export indicator, expected export activity in the following quarter is weighted at 60 percent with exports in the current quarter being weighted at 40 percent. The SME export indicator can range from 0 to 100, whereby figures between 0 and 50 signal an expected decline in exports and figures of 50 to 100 an expected rise in exports. Participants provide further information on export volumes, for instance the reasons for a change in their export volume, export markets, etc. This information gives an accurate picture of the export activities of Swiss SMEs.