Swiss watch industry calls for ‘clear solution’ with US

Watch industry calls for 'clear solution' between Switzerland and USA Keystone-SDA

With the suspension of United States tariffs only a few days away, the president of the Federation of the Watch Industry (FH) has called for a clear solution and a swift agreement between Bern and Washington.

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“We need a clear solution. The 90-day deadline expires on July 9, so we still have 13 days from today,” Yves Bugmann told the financial agency AWP on the sidelines of the FH general assembly in Lausanne.

It is clear that Bugmann’s fear refers to the looming threat of customs duties – announced in April and then frozen for three months – by US President Donald Trump, and which threaten to hit Swiss exports with heavy rates.

The Swiss watch industry is, therefore, has “‘the hours counted'”counting the hours”.

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Should Switzerland fail to reach an agreement with the US before time runs out, “it would be necessary to extend the deadline”, argues Bugmann.

In his view, applying duties that would force price adjustments for the market and consumers would create a catastrophic and “unliveable” situation.

“We hope to find a good solution with Washington, not least because Switzerland has good arguments,” the FH president, in office since 1 January 2024, pointed out. “It should not be forgotten that Switzerland is still one of the most important investors in the US. Moreover, US industrial products imported into Switzerland are duty-free.”

Imports of US-made watches are not taxed by even one cent, Bugmann said.

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The 50-year-old went on to reveal that the FH holds regular talks with the State Secretariat for Economic Affairs (Seco). The discussions are “on the right track”, he noted, while admitting that he is not necessarily aware of all the details.

What if the Trump administration really does impose an additional 21% tax on Swiss watches? Bugmann replied that even in this case, the Confederation would undoubtedly have to continue to seek dialogue with Washington in order to reach an agreement.

Despite all the unknowns, Bugmann remains confident about the development of the US market. According to him, as far as the star-studded market is concerned, the sharp drop in demand (-25.3% of exports to the US in May) was predictable, as the threat of customs duties prompted US buyers to stock up.

FH itself reported a sharp acceleration in sales in April, when a boom in deliveries to the US was registered in anticipation of the introduction of duties.

“In the first five months of the year we recorded a 28.5% increase in shipments, so the situation is quite good,” Bugmann concluded, although he admitted that “obviously there is some uncertainty” in the face of the new trade policy.

Translated from Italian by DeepL/mga

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