America has imposed new tariffs of 10% or 12.5% on selected imports from about 60 trading partners, including Switzerland. The White House says the countries concerned have failed to do enough to combat forced labour.
The measures, announced on Thursday, took effect overnight. The European Union, Japan and Taiwan are also named in the American documents. Switzerland will generally face the higher rate of 12.5%, although some products will be exempt.
The decision follows a ruling by America’s Supreme Court in late February that struck down many of the tariffs introduced by the president. Sector-specific duties on cars, steel, aluminium and copper were unaffected.
Swiss industry fears a competitive disadvantage
Swissmem, which represents Switzerland’s engineering and technology industries, criticised the decision. Swiss technology products will face a tariff 2.5 percentage points higher than comparable goods from the European Union, it said. That difference puts Swiss exporters at a competitive disadvantage. Swissmem also warned that Switzerland could face further tariffs arising from an American investigation into alleged industrial overcapacity. The organisation called on the Swiss government to reach an agreement with Washington that would place Swiss companies on an equal footing with their European rivals.
Swiss exports continue to rise despite tariffs
America continues to run a trade deficit with Switzerland. Even so, Swiss exports to the country have grown despite an earlier 10% tariff imposed by Donald Trump. In the second quarter, Swiss exports to America rose by more than 21%. Exports to the European Union increased by just 0.4% over the same period.
Economiesuisse rejects America’s case
Economiesuisse, Switzerland’s main business federation, described the new 12.5% tariff as unjustified and difficult to understand.
The measure will weigh on Swiss firms operating in the American market and leave them at a disadvantage to competitors in countries facing lower rates, including the European Union and Britain, it said.
The federation also rejected America’s claim that Switzerland has failed to prevent imports made with forced labour. Forced labour is prohibited under Switzerland’s constitution and its civil and criminal law, it noted.
The new tariffs have not removed the wider uncertainty facing exporters. America is conducting several other investigations, including one into possible industrial overcapacity. Economiesuisse urged Bern and Washington to continue negotiations to prevent these inquiries from producing additional duties.
Washington adjusts its tariff strategy
The White House hopes the new measures will survive legal scrutiny. Its previous round of tariffs was struck down by the Supreme Court in February. To strengthen its case, the Office of the United States Trade Representative has relied on the same law used to justify sectoral tariffs on steel, aluminium, copper, timber and cars. Those duties survived the court’s ruling. Several other investigations are being conducted under the same statute, including the inquiry into industrial overcapacity. Switzerland is covered both by that investigation and by the tariffs linked to forced labour.
The announcement follows further American trade measures against Brazil and Canada. Brazil has faced a 25% tariff on almost half of its exports to America since Wednesday. Canada was targeted on Monday with an additional 50% tariff due to take effect in a month. In both cases, however, the administration has narrowed its approach. Rather than taxing all imports from the two countries, it has restricted the duties to selected products.
Mr Trump’s tariff machine has many tentacles, and it will likely continue to thwart global trade.
More on this:
Whitehouse press release (in English)
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