By John Revill and Dave Graham ZURICH (Reuters) -Switzerland could clinch a deal with the United States to lower U.S. tariffs on Swiss exports to 15% as soon as Thursday or Friday, a Swiss source told Reuters on Tuesday. The source said the deal could also arrive early next week, but cautioned an agreement to […]
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Swiss could clinch deal for lower U.S. tariffs by end of this week, says source
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By John Revill and Dave Graham
ZURICH (Reuters) -Switzerland could clinch a deal with the United States to lower U.S. tariffs on Swiss exports to 15% as soon as Thursday or Friday, a Swiss source told Reuters on Tuesday.
The source said the deal could also arrive early next week, but cautioned an agreement to lower duties was not certain until U.S. President Donald Trump had given his approval.
Trump announced at the end of July that Swiss exports to the U.S. would be subject to a 39% tariff from August 7, among the highest duties levied in his global trade reset.
The move threatened Swiss access to one of its biggest markets for precision machinery, watches and chocolate by making its products more expensive than rivals from regions with lower import duties.
POSSIBLE BREAKTHROUGH FOLLOWS CONSTRUCTIVE TALKS ON FRIDAY
The Swiss Economic Affairs Ministry, which has been leading the negotiations with Washington, declined to comment on ongoing discussions on Tuesday.
Economy Minister Guy Parmelin was in regular contact with the relevant authorities in the United States, including U.S. Trade Representative Jamieson Greer, the government said.
The pair held a video call on Friday, with Parmelin describing the talks as “very constructive”.
On Monday, Trump said he was working on a deal to lower the tariffs on goods from Switzerland.
“We’re working on a deal to get their tariffs a little bit lower,” Trump said. “I haven’t set any number, but we’re going to be working on something to help Switzerland.”
Swiss officials have pitched a package of investment pledges and proposals aimed at reducing the U.S. deficit in hopes of securing an agreement.
A group of Swiss business leaders also met Trump in the White House last week to discuss the impact of tariffs on their operations, where they presented him with a specially engraved gold bar and a Rolex watch, according to Swiss media.
LUXURY STOCKS RISE ON NEWS OF POTENTIAL DEAL
The meeting with executives from MSC, Rolex, Partners Group, Mercuria, Richemont and MKS helped thaw relations with Washington, Swiss media reported.
The possibility of a deal gave hope to Swiss companies which have suffered under tariffs, said Jean-Philippe Kohl, vice director of Swissmem, an industry association.
“Tariffs at 15% are still very high, but a reduction from 39% would be clearly welcomed,” he told Reuters. “It would put Swiss companies on a level playing field with rivals from Germany, Austria, Italy and Japan who have the same 15% level.”
A speedy outcome was also to be welcomed, Kohl added.
News of a potential deal sent shares in Richemont and Swatch Group, owners of luxury Swiss watch brands, higher on Tuesday.
The United States is the biggest market for Swiss watches, accounting for 19% of all Swiss watch exports, according to the Swiss Watch Industry Federation, and is a major market for both companies.
Swatch, whose brands include Omega and Longines, said on Tuesday it would not comment on any deals before they had been implemented. Cartier-owner Richemont did not respond to a request for comment.
“Resolving the tariff dispute would be an early Christmas present for both listed Swiss luxury players and for the whole Swiss watch industry,” said Zuercher Kantonalbank analyst Patrik Schwendimann.
(Reporting by John Revill and Dave Graham; Editing by Louise Heavens, Susan Fenton and Alex Richardson)