Bilateral links with Switzerland will strengthen with an agreement struck with Hong Kong to host the world's largest annual jewellery fair for the next six years, a Swiss trade delegation says. The parties signed the deal on BaselWorld in September. Joseph Deiss, head of the Swiss Federal Department of Economic Affairs, said meetings with Financial Secretary Henry Tang Ying-yen and Permanent Secretary for Economic Development and Labour Stephen Ip Shu-kwan, had assured him there would be no problems. 'Hong Kong is our second most important partner in Asia ... and this underlines our good relations, especially now that Hong Kong has overcome its [economic] difficulties of the past few years and Sars,' he said. Mr Deiss is leading a mission of diplomats and a dozen Swiss business leaders on a six-day tour of Hong Kong and South Korea this month. 'We attach great importance to Cepa [the Closer Economic Partnership Arrangement]. It will stimulate the Hong Kong location and that is good for foreign investors, among them the Swiss,' he said. 'We hope we have achieved a future of co-operation' between Hong Kong and Switzerland with the visit, Mr Deiss added. Hong Kong's watch industry suffered a major embarrassment this year when Swiss authorities made it difficult for local businesses to attend BaselWorld, the biggest clock and watch trade fair in Europe, because of the Sars threat. The Swiss government ordered all 317 Hong Kong exhibitors to undergo medical checks before being allowed to enter the exhibition hall. The Hong Kong exhibitors pulled out and later protested in Central. The Hong Kong Trade Development Council and Swiss authorities agreed in September to a new deal ensuring local participation in BaselWorld and development of permanent facilities for Hong Kong firms.