Donald Trump’s announcement that 31-percent tariffs would be levied on imports from Switzerland sent shockwaves through the country’s economic circles. But what impact could this measure have on people directly?
Though the extent of damage inflicted by the hefty tariffs imposed on Switzerland’s export-oriented industries like pharmaceuticals, watches, precision instruments, chocolate, and even the iconic army knives are still being calculated, everyone agrees that they would be significant.
READ ALSO: What impact will Trump’s hefty tariffs have on Switzerland?
While it is still early in the process, and many unknowns remain (read more about this below), one thing is certain — by impacting Switzerland’s economy as a whole, the population will not come out of this ordeal unscathed.
How could these losses trickle down to you, the consumer?
In October 2024, in the midst of Trump’s threats about the upcoming tariff hikes, researchers at the KOF Economic Institute in Zurich calculated that this measure would result in annual losses of 200 francs for every Swiss resident.
At the time, the economists based their projections on an assumed punitive tariff of 20 percent.
However, the actual customs duties on goods imported into the United States from Switzerland are significantly higher, so the losses could therefore amount to substantially more than 200 per person per year.
Updated projections are expected to be announced shortly.
However, under no current scenario will Switzerland — and its residents — escape financial consequences.
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What exactly does this symbolic loss of several hundreds francs a year per person mean?
Expect your purchasing power to diminish.
According to Stéphane Garelli, professor of economics at the International Institute for Management Development (IMD) and the University of Lausanne, prices will increase.
That’s because companies subject to tariffs “will try to recoup from consumers the amounts they lose by exporting to the United States.”
Last but not least, if you have any investments, you probably noticed that the Swiss stock market plunged after Trump’s announcement and still remains in the red.
So that money is lost, and nobody knows for certain when (or even if) the markets will rebound.
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Can anything be done to lessen these losses?
These are the expected repercussions if things remain as they are.
However, even though the Federal Council announced that it would not counter Trump’s tariffs for the time being, Swiss president Karin Keller-Sutter and Economy Minister Guy Parmelin said they would be flying to Washington “very soon” in an attempt to negotiate lower duties with the US administration.
Experts predict that though totally abolishing the tariffs is unrealistic, Switzerland will most likely try to convince Americans to lower them to the same level as for the European Union — that is, to 20 percent.
That would mean less financial damage to Swiss economy and consumers, but whether this attempt would be successful remains to be seen.
