Swatch CEO on tariffs: ‘whole world saw Switzerland panic’

Hayek (Swatch): 'whole world saw Switzerland panic' Keystone-SDA

Swatch CEO Nick Hayek accuses the Swiss federal government of a lack of leadership in the tariff dispute with the United States.

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Switzerland showed signs of weakness and panicked before the eyes of the whole planet, he says: in his opinion, the government should have shown strength instead, for example by introducing tariffs on gold exports.

“Shortly after Swiss President Karin Keller-Sutter announced that everything would be fine, exactly the opposite happened,” the 70-year-old said in an interview published by the NZZamSonntag. “But what matters is not what happened in the previous 60 or 90 days, but how Switzerland reacted to the reversal and the sudden increase in customs duties to 39%. And that is precisely where leadership comes in.”

“The official reaction was: we are small, we are weak, we have no counter-arguments. A Chinese businessman from Beijing, who came to lunch with me a few days later, asked me what was going on in Switzerland. He said: ‘We admire Switzerland, its independence, strong currency, innovative industry, reliability, political stability. And now we suddenly hear from the Swiss government that the country is too small and too weak to defend itself against the United States. I don’t understand it, and it almost borders on an inferiority complex’. These frank statements struck me like William Tell struck the apple”.

Hayek added that he had never seen Switzerland so defensive. “In previous crises, communication was intelligent, backed up by solid self-awareness. The government ministers also maintained this attitude: reserved, but with inner strength. Today, on the other hand, I am scared. Because now we communicate to the outside world – not only to the Americans, but to the whole world – that we are weak and small, unable to defend ourselves. The whole world has seen that Switzerland is panicked,” the executive said.

Switzerland’s wealth, the Sunday paper’s journalists observed, seems to inspire envy. “It has always been that way,” said Hayek. “An experience that marked me was the visit of German Chancellor Helmut Kohl to my father more than 20 years ago. At the time it was about the Smart car project. My father asked him why everyone absolutely wanted Switzerland to join the EU. Kohl answered with sincerity and humour: ‘For the money’”.

What should Bern have done? “Everyone feared duties on gold bullion, then Trump declared that gold was excluded. Gold is crucial for the US financial markets. Switzerland could have said: ‘Thank you for the exemption, but we are now considering 39% duties on gold bullion exports to the US’. Calmly, but with determination. That would have been a clear and strong message to the US”.

This would put Switzerland in the spotlight; secondly, it would be clear that the country is defending itself, and “this is the best basis for people like Trump, who like, as he says, to make deals,” explains the manager with a past also in film (among other things, he directed and produced a film with Peter Fonda).

In the wake of the tariffs is there a danger of a de-industrialisation of the country? “No, on the contrary,” replied the son of Swatch founder Nicolas Hayek (1928-2010). “Switzerland is strong: no centralism, strong regions, a direct democracy involving the population. Pragmatic trade unions also contribute to stability. Industrial production is deeply rooted in many regions, supported by large companies and numerous small and medium-sized enterprises. Added to this are the unique apprenticeship system, a good education system, a low public debt and pride in Swiss made. Of course there are also disadvantages, such as the strong franc, but we are used to it by now,” he said.

Translated from Italian by DeepL/jdp

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