Export Risk Monitor 2017 on rising problems

As the annual Export Risk Monitor shows, Swiss exporters expect 2017 to be a successful year for exports. Despite a decisive Brexit and political capers by US President Donald Trump, the "export and risk situation of Swiss companies is better than many expected," says Stefan Ruf, CEO of Euler Hermes Switzerland.

The effects of the abrupt currency appreciation two years ago have therefore largely been digested. After the record year of 2016, the current year is likely to bring positive figures for Swiss exporters once again. The mood among the 330 SMEs surveyed is improving, particularly with regard to the sales markets in the East, namely China, Japan and Russia.

Bankruptcies stagnate

The number of insolvencies is stabilising: after rising by 3 per cent in 2016, the number of bankruptcies in Switzerland is likely to remain largely stagnant in 2017, with an increase of 1 per cent, according to Euler Hermes.

It is also a fact that many SMEs that were affected by the sudden strength of the franc are still facing challenges. Exporters then also cited currency fluctuations as the biggest business risk - 92 percent of respondents said so in the survey.

The cyclical and del credere risks follow with 77 and 53 percent respectively. Nevertheless, the bottom line remains the same: Some of the companies are much less concerned about the above-mentioned risks today than they were a year ago. This is striking, say the study's authors.

"Franks leveled"

The experts are convinced that the franc has found a new equilibrium with the euro. Accordingly, economic output as a whole will increase by 1.6 percent. According to Euler Hermes chief economist Ludovic Subran, Swiss exports are likely to grow by another 4 percent this year - equivalent to CHF 7 billion worth of goods being sold abroad this year.

"The franc has settled at a new equilibrium against the euro," says Ludovic Subran.

Key data from the Export Risk Monitor 2017:

• after a good export year in 2016, especially to China, the USA, Japan and Russia.
• An increasing risk situation is expected for France, Italy, Great Britain, the USA, Turkey, Brazil and Russia - for other important export markets such as Germany or China/Hong Kong, the risk is assessed as low and stable.
• Among the hedging measures, crisis measures such as "relocation abroad" and "extension of working hours at the same wage" are mentioned less often than in last year's survey.

Further information is available at www.ti.bfh.ch/exportrisiko_monitor and www.eulerhermes.ch available.