Prices for the eponymous Swiss watches, Swiss chocolate and Swiss cheese could skyrocket in a week as a result of U.S. President Donald Trump’s trade war.
Switzerland, home to some the world’s most recognizable luxury brands, now faces an upcoming 39% tariff from the U.S. Industry groups on Friday warned that both Swiss companies and American consumers could pay the price.
Trump signed an executive order Thursday placing tariffs on many U.S. trade partners — the next step in his trade agenda that will test the global economy and alliances — that’s set to take effect next Thursday. The order applies to 66 countries, the European Union, Taiwan and the Falkland Islands.
In Switzerland, officials failed to reach a final agreement with the U.S. after Trump initially threatened a 31% tariff in April. Swiss companies will now have one of the steepest export duties — only Laos, Myanmar and Syria had higher figures, at 40-41%. The 27-member EU bloc and Britain, meanwhile, negotiated 15% and 10% tariffs, respectively.
The Swiss government spent Friday — the country’s National Day — reeling from the news. Swiss President Karin Keller-Sutter said that the 39% figure was a surprise, because negotiators had hashed out a deal last month with the Trump administration that apparently wasn’t approved by the American leader himself.
“We will now analyze the situation and try to find a solution,” Keller-Sutter told reporters. “I can’t say what the outcome will be, but it will certainly damage the economy.”
The U.S. goods trade deficit with Switzerland was $38.5 billion last year, a 56.9% increase over 2023, according to the Office of the United States Trade Representative. Keller-Sutter said that she believes Trump ultimately chose the 39% tariff, because the figure rounded up from the $38.5 billion goods trade deficit.
“It was clear that the president was focused on the trade deficit and only this issue,” she said.
For Swiss watch companies, whose products already come with price tags in the tens of thousands — if not the hundreds of thousands — of euros, a timepiece for an arm could cost a leg, too, come next week.
The 39% figure was especially galling to the Federation of the Swiss Watch Industry, because Switzerland in 2024 got rid of import tariffs on all industrial goods.
“As Switzerland has eliminated all custom duties on imported industrial products, there is no problem with reciprocity between Switzerland and the U.S.,” the federation said in a statement. “The tariffs constitute a severe problem for our bilateral relations.”
Swiss watch exports were already facing a prolonged slowdown, with significant declines in the United States, Japan and Hong Kong, according to