BERN, Switzerland – August 7, 2025 – Switzerland’s Federal Council has convened an urgent emergency meeting to address the fallout from newly implemented U.S. tariffs, which unexpectedly rose to 39% on Swiss exports, including luxury watches, machinery, chocolate, and metal goods.
Crisis Escalates Ahead of Tariff Deadline
President Karin Keller‑Sutter returned from a diplomatic mission to Washington without securing a reduction in tariffs—her proposal for a 10% rate was declined. She was unable to meet with President Trump, but held constructive talks with Secretary of State Marco Rubio.
Economic Shockwaves
- The 39% tariff—one of the highest imposed by Washington on a developed nation—went into effect early August 7.
- Analysts estimate the shock could shave up to 0.6% off Switzerland’s GDP, with tens of thousands of jobs at risk, especially in the export-reliant sectors of watches, machinery, and food.
- Swiss markets and companies—including mid-size industrial exporters—face mounting pressure as prices rise sharply and demand plunges.
Government Response & Next Steps
- During the emergency session, cabinet members pledged to continue negotiations with U.S. officials and promised a “more attractive offer,” potentially involving direct investment in the U.S. or increased purchases of American energy.
- No counter-tariff or retaliatory measures are currently under formal consideration, but political leaders—including opposition parties and business groups—are calling for a strategic response, such as trade task forces or even reconsidering military equipment deals with the U.S.
Political Fallout & Trade Strategy
- Domestically, criticism is mounting toward Keller‑Sutter’s handling of the talks, with calls for a recalibration of Swiss trade diplomacy—some politicians advocate aligning more closely with the European Union rather than relying on bilateral U.S. engagement.
- Switzerland had unilaterally abolished most industrial tariffs on its end in 2024, granting near free access to U.S. goods—a stark contrast to the punitive tariffs now imposed in return.
As tensions rise, investors, industries, and policymakers await further announcements from Bern detailing Switzerland’s strategy to mitigate economic damage and restore trade stability.