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Swiss shoppers lured by bargains get more trams to Germany
[ZURICH] Tram 8, crossing the border from Basel to neighbouring Germany, may be packed tomorrow as Swiss shoppers take advantage of their suddenly increased spending power.
A Swiss franc buys about 20 per cent more on Friday in Germany than it did on Thursday morning after the Swiss National Bank abolished its three-year cap on the franc of 1.20 per euro. The two currencies were trading near parity on Friday.
"We register high demand for means of transportation to Germany," said Claudia Demel, a spokeswoman for the Basel's public transport company.
"This should be seen in the direct context of the abolition of the cap," she said, adding that the frequency of trams has been increased to accommodate additional travelers.
Swiss shoppers frequently cross the border to neighbouring countries to take advantage of prices that can be significantly lower. According to the price-comparison website, barometredesprix.ch, buying 53 typical food products such as cream cheese and coke at the grocery store Migros in Switzerland was 55 per cent more expensive than at Kaufland in Germany.
For people in German-speaking Switzerland, trips to the German lake-side town of Konstanz, which boasts big shopping centers, is particularly popular. A survey on the merits of the SNB's cap exit by the tabloid Blick gave readers the option of clicking "Konstanz, we're coming!" One in five respondents chose that answer.
Swiss residents are allowed to import 300 francs (US$345) of goods per person a day without paying duty and are also entitled to recoup value-added taxes.
While the Swiss Federal Customs Office expects the franc's appreciation to have an effect on shopping habits, authorities won't be increasing inspections at the border because they're focusing on organized smuggling and crime, said Martin Affolter of the Bern-based institution.
Swiss consumers already spent about 10 billion francs abroad in 2013, according to market research firm GfK.
Geneva's TPG has no plans to follow suit and boost public transport to France, according to a spokeswoman.
"The consumers will be the big winners," said Jan-Egbert Sturm, head of the Zurich-based KOF Economic Institute. "For them, the daily consumption goods will get cheaper."