Switzerland, Facing the Highest Tariffs Among Developed Nations, Gifts Trump Watch and Gold Bar to Secure Nod

According to a November 10 report by the UK's The Telegraph website, cited by Reference News, Switzerland is nearing an agreement with the United States that could lead to a significant reduction of its 39% tariff rate. This potential breakthrough follows a gesture last week where Swiss business representatives presented Trump with a Rolex clock for his presidential library and a custom gold bar.

Attendees of this Oval Office meeting at the White House included executives from Rolex, Richemont Group, and MKS PAMP Group. Negotiators discussed lowering the current tariffs on Swiss exports to 15%. This proposed 15% rate would align with the tariffs the US imposes on Switzerland's neighbors (EU countries).

In August of this year, Trump imposed a 39% tariff on Switzerland, the highest among all developed nations. Trump justified this by citing a $40 billion trade deficit with Switzerland, calling it a "big number." This trade surplus is largely driven by exports of gold bars, luxury watches, chocolate, and pharmaceuticals.

The Swiss government stated that the new US tariffs place significant pressure on Switzerland's export-oriented economy. Approximately 18% of Swiss exports are destined for the US, with nearly 60% of those affected by the new tariffs. Data from the Swiss Federal Customs Administration shows that the US has consistently been Switzerland's largest export market since 2021. In 2024, Switzerland's top five export industries by value are chemicals and pharmaceutical products, machinery and electronics, watches, precision instruments, and metals. The US is the largest export market for Swiss chemicals/pharmaceuticals, watches, and precision instruments, and the second-largest market for machinery and electronics.

Watches, particularly high-end luxury watch brands, are virtually synonymous with Swiss manufacturing. Swiss watches are renowned for their exquisite craftsmanship, complex mechanical movements, and unique original designs. The US tariffs have undoubtedly dealt a heavy blow to this pillar industry. According to the latest data from the Federation of the Swiss Watch Industry, Swiss watch exports saw a significant decline in August, with total export volume falling 16.5% year-on-year, while exports to the US dropped by nearly 24%.