39% US Tariffs on Swiss Goods: A Historic Blow to Swiss Export Economy

On August 7, 2025, the United States imposed 39% import tariffs on most Swiss goods—a move that marks one of the most significant trade barriers Switzerland has faced in decades.

While EU goods face only around 15% tariffs, the targeted action against Switzerland signals increased pressure from Washington. The reasons go beyond trade disputes and reflect deeper geopolitical dynamics. The US has intensified its stance on trade surpluses among its partners—and Switzerland has long maintained a strong trade surplus with America.

Early Impact: From Coffee Machines to High-Tech Equipment

One of the first companies hit was Thermoplan, a leading coffee machine manufacturer whose equipment is used in Starbucks locations worldwide. The US was a key growth market, but the new tariffs now cost the company about CHF 200,000 per week. It is reportedly considering relocating parts of its production to Germany or the US.

The damage isn't limited to one sector. Swiss industries ranging from machinery to precision tech and industrial components are being affected. For a country where exports make up over half of GDP, this is a serious blow.

Economic Outlook: Risk of Recession

According to ETH Zurich economist Hans Gersbach, the tariffs could cut GDP growth by 0.3 to 0.6%. If the pharmaceutical sector—which accounts for over one-third of Swiss exports—is affected, the contraction could exceed 0.7%, potentially triggering a recession.

Pharmaceuticals: Temporary Immunity

So far, major pharmaceutical firms like Novartis, Roche, and Lonza are exempt from the tariffs. This has helped avoid an immediate export collapse. But Washington has left the door open to extending tariffs to medical and biotech products. Such a step would severely impact Switzerland’s economic core.

Diplomatic Efforts Fall Short

Swiss President Karin Keller-Sutter traveled to Washington in August but returned without a deal. Economic Minister Guy Parmelin later offered a compromise: increased Swiss investment in the US, purchases of US defense equipment, and broader access for American energy firms to the Swiss market. But talks have yielded no breakthrough.

Domestic Response: Adjusting the Strategy

With no quick fix in sight, the Swiss government is focusing on boosting competitiveness:

• Reducing bureaucracy for businesses
• Providing targeted incentives for industry
• Developing new investment mechanisms

One creative proposal: import commercial aircraft into Switzerland on behalf of European airlines (e.g., Lufthansa) to increase Swiss import volumes and reduce the trade surplus with the US.

Market Response: Stronger Franc, More Pressure

The Swiss franc has strengthened—as is typical during uncertainty. This lowers import costs but hurts exporters by making Swiss goods more expensive abroad.

Why Target Switzerland?

• Significant trade surplus with the US
• Politically easier target than the EU or China
• A symbolic message to global partners: the US is willing to exert pressure, even on allies

What Comes Next? Three Scenarios

1. Compromise: Partial rollback of tariffs in exchange for concessions
2. Escalation: Extension to pharma, deeper economic damage
3. Prolonged Conflict: Relocation of production, long-term economic restructuring

Conclusion

The new US tariffs have delivered a cold economic shock to Switzerland. A country long seen as a model of stability is now being forced to adapt. With 39% duties already impacting machinery and high-tech sectors, and the threat of extending to pharmaceuticals looming, 2025 could be remembered as the year Switzerland faced a major reckoning in global trade.

Whether diplomacy can defuse the situation remains uncertain—but change is already underway.

Sources

1. Reuters — Swiss economy minister in US to seek better deal on Trump tariffs
2. MarketWatch — Switzerland shocked by 39% Trump tariffs
3. Reuters — Switzerland facing 39% US tariff as president leaves Washington empty-handed
4. Wikipedia — Switzerland–United States relations
5. Reuters — Key Starbucks supplier in Switzerland tastes bitter harvest of Trump tariffs
6. Reuters — Switzerland says it's ready to make Trump ‘more attractive’ offer
7. Wikipedia — Proposed Switzerland–United States Free Trade Agreement
8. AP News — The Latest: As Trump's sweeping new tariffs take effect
9. Reuters — Switzerland moves to strengthen its competitiveness after US tariffs
10. Reuters — Plane imports discussed as part of Swiss-US tariff impasse
11. Financial Times — Will the next US jobs report make a Fed rate cut more likely?