US-Switzerland Trade Deal: Tariffs Slashed from 39% to 15%
The United States and Switzerland have finalized a major trade agreement that will significantly reduce tariffs on Swiss exports from 39% to 15%. The breakthrough, announced by US Trade Representative Jamieson Greer, concludes months of tense negotiations and provides substantial relief to Swiss industries.
Key Takeaways
- Tariffs on Swiss goods drop dramatically from 39% to 15%
- Switzerland commits to $200 billion investment in US economy
- Major focus on pharmaceuticals, gold smelting, and meat exports
- Deal ends months of trade disputes between the two nations
“We’ve essentially reached a deal with Switzerland,” Greer said during a CNBC interview. “So we’ll post details of that today on the White House website.”
The Swiss government confirmed the agreement through social media, thanking President Donald Trump for his constructive engagement. Swiss officials held a press conference in Bern to discuss the landmark deal.
Benefits for Swiss Exporters
The agreement brings crucial relief to Switzerland, which had faced the highest tariff rate imposed by the Trump administration on any developed country. The new 15% rate matches most-favoured-nation treatment and aligns with US agreements with the European Union.
While Swiss exporters now achieve parity with their EU competitors, they still face challenges from the strong Swiss franc, which recently hit a decade-high against the euro.
Investment and Sector Focus
Under the agreement, Switzerland has committed to investing $200 billion in the United States during Trump’s presidency, with $70 billion allocated for the coming year. The investments will focus heavily on pharmaceuticals and gold smelting sectors.
Major Swiss pharmaceutical companies Roche Holding AG and Novartis AG have pledged over $70 billion for US manufacturing and research development. Additionally, Switzerland has committed to purchasing more Boeing commercial aircraft.
Swiss Economy Minister Guy Parmelin assured reporters that the agreement protects Switzerland’s neutrality and independence, stating the country “has not made any concessions that could threaten its neutrality or independence.”
Agricultural Market Access
In a significant move, Switzerland will provide duty-free tariff quotas for American agricultural products, including:
- 500 tonnes of beef
- 1,000 tonnes of bison meat
- 1,500 tonnes of poultry meat
This represents a rare relaxation of Switzerland’s strict agricultural trade protections, though the move is expected to face political opposition from the influential Swiss farmers’ lobby.
Resolution of Trade Dispute
The deal resolves a contentious trade dispute that began in August when the Trump administration unexpectedly imposed 39% tariffs on Swiss exports—more than double the rate applied to EU countries. The administration cited a $40 billion goods trade deficit as justification, surprising Swiss officials who believed they had already reached an understanding with US counterparts.
Swiss watchmakers, machinery manufacturers, precision instrument producers, and food and chemicals exporters were hardest hit by the previous 39% tariff rate. Notably, pharmaceutical products and gold exports were exempt from the higher tariffs under existing US rules.
