Switzerland is facing economic challenges following the implementation of a 39% tariff on its goods by the United States, which has not agreed to renegotiate this rate despite the Swiss government’s efforts. This tariff, announced on August 1, 2023, is significantly higher than those imposed on other countries, including the UK and European Union, who secured tariffs of 10% and 15%, respectively.
Swiss officials have expressed concern given that approximately 17% of Swiss exports are directed towards the US market. Key sectors, particularly pharmaceuticals and medical technology, have been identified as crucial to the Swiss economy. Although pharmaceutical exports are not directly affected by the 39% tariff, there are looming threats of a 100% tariff on imported medicines.
The medical technology sector, particularly firms like MPS (Micro Precision Systems) in Biel, exemplifies the intricacies of Swiss manufacturing. MPS produces high-precision medical instruments, often reliant on sophisticated local manufacturing processes. The company’s CEO, Gilles Robert, has indicated that transferring these operations to the US would be exceptionally difficult due to the specialized skills required.
The tariffs have already begun to impact the economy, with job losses anticipated and overall economic growth showing signs of contraction. Increased costs for US patients accessing Swiss medical devices have been reported, leading experts like Adrian Hunn of Swiss Medtech to assert that healthcare costs will ultimately burden US taxpayers.
In response to the tariffs, Switzerland is pursuing new trade partnerships, including recent agreements with India and ongoing negotiations with the Mercosur bloc and China. Despite the challenges presented by US tariffs, Swiss leaders maintain a degree of confidence in resilience and adaptability in international markets. However, there remains a palpable concern about the long-term implications for US-Swiss relations, historically characterized by strong business collaborations.
Source: https://www.bbc.com/news/articles/cy4r12pzxgko?at_medium=RSS&at_campaign=rss