(Bloomberg) -- Swiss watch exports extended their longest decline in about three years as the industry becomes even more dependent on the Chinese market.
Shipments fell 12% to 1.6 billion francs ($1.76 billion) in September, dropping an eighth consecutive month, according to the Federation of the Swiss Watch Industry.
Exports to China surged 79%, while falling almost everywhere else. China has been one of the few bright spots amid the gloom this year, and the country is replacing Hong Kong as the top destination for Swiss luxury timepieces.
Hong Kong had been the biggest market for more than a decade, as wealthy Chinese often traveled there to buy watches to avoid China’s luxury taxes. Swiss watchmakers in turn overly relied on that market, and suffered when pro-democracy protests erupted on the island and China started trying to engineer a shift of luxury consumption to the mainland.
Now Swiss watchmakers are eyeing the southern Chinese province of Hainan as business there is booming amid its resorts and casinos, according to Julien Tornare, the head of LVMH’s Zenith brand. China in July increased the tax-free shopping limit in Hainan to 100,000 yuan ($14,930) annually per person, up from 30,000 yuan.
Swiss watch exports dropped 28% in the first nine months of the year.
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