US to Cut Tariffs on Swiss Goods to 15% in Breakthrough Deal

(Bloomberg) — The US and Switzerland have “essentially” reached a trade agreement to lower tariffs on Swiss goods from 39% to 15%, and the White House plans to reveal details on Friday, US Trade Representative Jamieson Greer said.

The Swiss government confirmed the deal in a post on X, thanking President Donald Trump for his “constructive engagement.” Swiss leaders began a press conference late Friday afternoon in the capital Bern to discuss the accord.

The pending deal brings some relief to Switzerland, which was hit by the highest levy the Trump administration imposed on any developed country. The 15% levy is inclusive of most-favored-nation rates and certain other existing duties, a similar arrangement to the European Union, Greer told reporters.

Bloomberg News reported on Monday that Switzerland and the US were moving close to a 15% tariff rate.

By securing a tariff that matches what the EU secured, Swiss exporters have put themselves at parity with rivals in the trading bloc. However, it doesn’t give them an advantage over European competitors who don’t have to contend with a strong franc, which earlier today climbed to a decade high against the euro.

In exchange, Switzerland has committed to investing $200 billion in the US during Trump’s term, including $70 billion next year, in industries such as pharmaceuticals and gold smelting, according to Greer. Switzerland has also committed to buying more Boeing Co. commercial planes, Greer said.

Whereas Roche Holding AG and Novartis AG have pledged to invest more than $70 billion in manufacturing and R&D in the US in the coming years, it’ not yet clear where the remainder will come from. Like gold and semiconductors, pharmaceutical products remain exempt from the tariffs for now. Both Roche and Novartis are in talks with the White House over ways to lower drug prices and avoid potential future duties, following recent deals by Pfizer Inc., AstraZeneca Plc and others.

“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.”

Swiss Economy Minister Guy Parmelin told reporters on Friday afternoon that the country “has not made any concessions which would threaten its neutrality or independence.”

Still, under the deal Switzerland will grant the US duty-free bilateral tariff quotas on 500 tonnes of beef, 1,000 tonnes of bison meat and 1,500 tonnes of poultry meat in a rare softening of its agricultural trade barriers. Given the strong Swiss farmers’ lobby, such a move will likely be politically controversial.

Shuttle Diplomacy

The agreement is the capstone of months of shuttle diplomacy by Swiss government officials and business figures, after the countries’ key industries, including watches, machinery and precision instruments, were punished by the crippling US tariff.

Greer said that Switzerland is “going to send a lot of manufacturing here to the United States, pharmaceuticals, gold smelting, railway equipment. So we’re really excited about that deal and what it means for American manufacturing.”

Swiss manufacturers of watches, machines and precision instruments, along with food and chemicals exports have been the hardest hit by the 39% levy, according to Switzerland’s central bank. Other key Swiss exports like medicines and gold were exempt from the rate under the different US tariff regimes.

The breakthrough ends a months-long dispute that began in August, when Trump stunned Bern by imposing the 39% tariff on Swiss exports, more than double the rate applied to the EU. The move, which the Trump administration justified as a response to what officials described as a $40 billion goods trade deficit, came as a surprise to Swiss officials who believed they had previously agreed on a deal with US counterparts.

It was a surge in gold exports that helped blew out Switzerland’s trade surplus with the US at the time when it was most sensitive. Bullion exports of more than $36 billion made up over two-thirds of the US’s deficit with the Swiss in the first quarter driven by a tariff arbitrage trade.

Switzerland, the central hub of the world’s gold refining industry, offered to invest in the sector in the US earlier this year, in a bid to improve their tariff settlement, Bloomberg reported in September.

Momentum shifted this month, when a group of Swiss billionaire executives met Trump in the White House in what was described as an atmosphere among friends. That was in sharp contrast to a heated phone call that took place between the US president and his Swiss counterpart Karin Keller-Sutter before the August crisis emerged.

Absent President

The Swiss president has been absent from much of the talks in recent weeks. Instead, Parmelin, who takes over the rotating Swiss presidency on Jan. 1 from Keller-Sutter, and Swiss State Secretary Helene Budliger Artieda, his top negotiator, have led the Swiss delegations in this autumn’s talks.

The pair fielded questions from reporters in Bern today with no sign of the Swiss president who has six weeks left in office.

–With assistance from Fabienne Kinzelmann, Levin Stamm and Allegra Catelli.

(Update with details on agreement throughout)

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