Latest News Roundup in Switzerland on a Monday
In an unexpected turn of events, Swiss companies are grappling with the impact of a 39-percent customs duty imposed on imports to the United States. The tariffs, announced in April, have raised concerns among Swiss businesses, particularly those in the watch industry, pharmaceuticals, machinery, and chocolate sectors.
The Swiss government is actively engaging in negotiations with the US to reach a trade deal that could potentially reduce or eliminate these tariffs. Swiss officials have prepared a "more attractive offer" to address US concerns and prevent the tariffs from causing severe economic damage. However, so far, talks have been unsuccessful.
Swiss companies are mainly absorbing the tariff shock while urgently supporting their government’s negotiation efforts. The tariffs substantially increase import costs and threaten their competitiveness in the important US market. Some companies, like Roche and Novartis, may not have to pay the 39-percent duties if they lower the prices of drugs they export to the United States within the next 60 days.
The business community fears significant economic fallout, including job losses among the approximately 60,000 workers in Swiss watchmaking and related US retail and marketing jobs. The tariffs are expected to negatively impact Swiss economic growth by up to 1% and disrupt key export sectors.
In a bid to find a solution, the Federal Council is holding a video conference today to discuss how Switzerland should respond to the tariffs. No countermeasures have been imposed yet, but some experts believe that imposing Swiss sanctions as a response would not have a significant impact on America's economy due to Switzerland's minimal share in US businesses.
Meanwhile, the Swiss National Bank (SNB) has chosen "Switzerland and its Altitudes" as the theme for the 10th banknote series, to be circulated at the beginning of the 2030s. The SNB asked for design submissions from the Swiss population in the fall of 2024, and out of 300 submissions, 12 were chosen to create the final sketches by July 31st, 2025. The final sketches for the new banknotes have been completed and will be unveiled to the public in the coming weeks. The new banknotes will depict various Swiss mountains, ranging from the Jura hills to the Alps.
Philippe Nel, a former government negotiator, stated that renegotiating the tariffs will be difficult. Matthias Bopp, head of international trade at KPMG financial services company, mentioned that certain conditions must be met for Swiss companies to be exempted from the high tariffs.
As the negotiations continue, Swiss companies remain hopeful for a resolution that will alleviate the financial burden imposed by the tariffs and preserve their competitive edge in the US market.
- The tariffs, affecting various Swiss sectors such as watchmaking, pharmaceuticals, machinery, and chocolate, have raised concerns in both the business and political realms, with Swiss officials actively negotiating with the US to address US concerns and prevent severe financial damage.
- As the negotiations proceed, the financial impact of the tariffs is not only a matter of concern for Swiss companies but also for the general news, as the potential economic fallout, including job losses and disrupted export sectors, could significantly affect Switzerland's overall growth.
