The United States will slash its tariffs on goods from Switzerland to 15 percent from a crippling 39 percent under a new framework trade agreement that includes a pledge by Swiss companies to invest $200bn into the US by the end of 2028, the Swiss government has said.
The announcement by Swiss Economy Minister Guy Parmelin on Friday brings the US tariff rate on Swiss goods in line with those from the European Union (EU). Parmelin told a news conference that the tariff reduction would provide relief for about 40 percent of Switzerland’s total exports.
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The US, Switzerland and Liechtenstein, which is part of the deal, aim to conclude negotiations to finalise their trade deal by the first quarter of 2026, the White House said in a statement on Friday as the two nations announced their framework agreement.
The lower tariff rate is likely to be activated within “days, weeks,” as soon as the US customs processing systems can be adjusted, said Helene Budliger Artieda, director of Switzerland’s State Secretariat for Economic Affairs.
She added that a large portion of Swiss investments in US production would come from the pharmaceuticals and life sciences sectors, but declined to provide specifics. Pharmaceuticals is by far the largest export sector from Switzerland to the US.
US Trade Representative Jamieson Greer told CNBC the deal would involve Switzerland shifting “a lot of manufacturing here to the United States – pharmaceuticals, gold smelting, railway equipment. So we’re really excited about that deal and what that means for American manufacturing.”
The deal guarantees a 15 percent tariff ceiling for Swiss drugmakers, including Roche and Novartis from US President Donald Trump’s forthcoming Section 232 national security duties for the sector, which could reach 100 percent for certain patented drugs.
Parmelin said the 15 percent cap would also apply to other future Section 232 duties, including semiconductors, putting it on the same footing as the EU.
“The risk of much higher sector-specific tariffs is therefore ruled out,” Parmelin added.
In a statement, the Swiss government said the deal will reduce Swiss import duties on US industrial products, fish and seafood and agricultural products “that Switzerland considers non-sensitive”.
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, the government said.
Level playing field with the EU
Swiss industrial groups welcomed the deal, saying it would put them on a level playing field with competitors from the EU, which agreed to a 15 percent tariff on EU exports to the US.
“For the industrial sector, which was subject to a 39 percent tariff since August 1, this is good news. For the first time, we have the same conditions in the US market as our European competitors,” said Nicola Tettamanti, president of Swissmechanic, which represents small and medium-sized manufacturers.
“It’s a great relief on tariffs, but additional economic burdens and risks for Switzerland remain,” said Hans Gersbach, a director of the KOF Swiss Economic Institute at ETH Zurich.
Switzerland’s machinery, precision instruments, watchmaking, and food sectors, which export to the US, would see the most relief, Gersbach said.
KOF forecasts Swiss economic growth of 0.9 percent in 2026, but this would exceed 1 percent with the lower tariff rate, he added.
Nadia Gharbi, an economist at Swiss bank Pictet, said the tariff reduction removed the main downside risks for the country’s economy and represents a clearly positive development for Swiss industries and for the overall growth outlook.
“Under the previous tariff regime, Switzerland suffered a significant loss of competitiveness — not only because of the strength of the Swiss franc, but also because neighbouring European economies were subject to tariffs of only around 15 percent,” she said.
Swiss industry on Friday reported a 14 percent fall in exports to the US during the three months through September, technology industry association Swissmem said, while machine tool makers saw shipments slump 43 percent.
