Switzerland's trade surplus narrowed sharply in December to 503 million francs, its lowest level in four years, as a jump in imports outweighed higher exports, the Federal Customs Office said. The trade surplus was 2.033 billion francs in November. December imports were up 8.4 percent to 14.187 billion francs, with consumer goods and investment goods both seeing double-digit progressions. A 3 percent rise in prices of imported goods also helped to boost imports. Swiss exports also rose, by a nominal 5.2 percent to 14.69 billion Swiss francs ($16.26 billion), with strong demand seen for precision instruments, machines and electronic devices as well as pharmaceuticals and chemicals. Exports to Europe, Switzerland's biggest trading partner, picked up. Exports also benefited from an extra trading day in December, without which they would have fallen slightly, the customs office said. Adjusted for inflation, exports rose 8.2 percent, while imports were up 5.3 percent. Prices for exported goods fell, dragged down by pharmaceuticals, while prices for imported goods rose, helped by a strong progression in consumer goods. Swiss exports have been supported by a cap the central bank imposed on the soaring franc currency in 2011, but have suffered from sluggish demand in Europe. Recent data suggests the outlook for the Swiss economy at the start of the year is brighter, with growth in the manufacturing sector accelerating in January. Exports to Europe, Switzerland's biggest trading partner, rose 6.4 percent in December, the customs office said. Exports of pharmaceuticals and chemicals, the country's biggest export category, rose 19.3 percent in real terms, but only 5.2 percent in nominal terms as prices fell. They hit a record high of 80.961 billion Swiss francs for the whole year. Machines and electronic devices were up 13.3 percent in December, while watch exports rose 3.8 percent. The latter category also hit a record at 21.835 billion francs in 2013. Swiss watch exports to the important Chinese market improved in December, the Swiss watch federation (FH) said in a separate statement on Thursday. Exports of Swiss timepieces to Hong Kong, their biggest market, were down 1.8 percent in December, after falling 5.6 percent for the whole of 2013, the FH said in a statement, speaking of a "gradual recovery". Exports to mainland China, the third biggest market for Swiss watches, jumped 18.8 percent, notably thanks to a very favourable base effect, the FH said. They were down 12.5 percent in 2013. Last year, exports of Swiss goods to Europe and Asia declined in nominal terms by 0.6 percent and 1 percent respectively. Europe and Asia together absorbed 80 percent of Swiss exports in 2013, the office said. (Reuters)