For many Swiss firms, the effect is immediate and tangible. The watch industry, emblematic of high-value Swiss exports, saw a dramatic slump after tariffs were applied earlier in the year, with some data indicating double-digit falls in shipments to the US.
Swiss exporters breathed a cautious sigh of relief this week after the United States agreed to cut its country-specific additional tariff on Swiss goods to 15% – down from the punitive 39% level that had gravely disrupted trade flows this year – alongside a high-profile pledge by Swiss firms to invest roughly $200 billion in the US by the end of 2028. The twin measures mark a substantive de-escalation of a trade spat that has dented Swiss shipments of watches, machinery, and other premium goods to America.
The tariff reduction – supposed to put Swiss exporters on parity with European Union producers who already enjoyed a 15% level – was framed by Swiss officials as hard-won relief. The White House fact sheet framed the deal as part of a broader effort to “smooth bilateral trade and open markets for sensitive U.S. agricultural and medical exports.” Switzerland signaled meanwhile that the cut would apply retroactively to the date the two sides reached their declaration of intent.
For many Swiss firms, the effect is immediate and tangible. The watch industry, emblematic of high-value Swiss exports, saw a dramatic slump after tariffs were applied earlier in the year, with some data indicating double-digit falls in shipments to the US. Bringing the tariff back to 15% materially eases margin pressure for exporters and should restore some competitiveness in a market that accounts for a significant slice of Swiss luxury sales. Financial analysts say this move will lower costs, unblock stalled orders, and remove an important source of uncertainty for exporters planning production and inventory.
Yet relief is mingled with unease. The deal’s headline $200 billion investment figure – presented as a commitment by Swiss companies to ramp up direct investments in the United States through 2028 – has provoked close scrutiny at home. Critics warn that the pledge could encourage offshoring of capital-intensive activity and research-and-development jobs, shifting economic value away from Switzerland even as it secures market access. Business associations and economists are divided: some welcome the prospect of deeper US ties, while others caution about long-term structural consequences.
Public sentiment in Switzerland appears fragile. Recent polls put a sizeable portion of the Swiss population either opposed to or hesitant about the terms of the agreement, with concerns ranging from data-transfer provisions to the potential for increased foreign control of strategic assets. Political hurdles remain: the agreement was published as a joint declaration of intent and must still pass through domestic scrutiny-including parliamentary debate and the possibility of a referendum-before it becomes irreversible policy. That political risk keeps the outlook prudently guarded.
To Washington, the agreement brought several wins: reducing a trade friction that had imperiled US supply chains and consumer prices while securing a significant capital inflow pledge, with heightened market access for US farm and medical products. Trade officials cast the deal as reciprocal and targeted, weighing quick tariff relief against commitments favoring US manufacturing and investment. Observers said it also fell into a larger US approach of selected, bilateral deals that try to combine market opening with strategic industrial objectives.
Export orders and confidence indicators for affected industries ticked up, though CEOs emphasized that the finer print matters – rules of origin, customs procedures and the sequencing of investment pledges will determine how much of the $200 billion translates into new plants, jobs and long-term partnerships in the US. Banks and trade bodies have urged clarity on implementation timelines and safeguards to prevent unintended capital shifts away from Switzerland.
The deal is a pragmatic compromise. It closes a painfully asymmetric tariff regime that had penalized Swiss producers while securing a sizeable investment promise the United States can show off as economic gain. Whether it proves a lasting win for Swiss exporters depends on parliamentary ratification, the legal text that follows up from the declaration of intent, and how Swiss companies decide to allocate the promised capital.
