Swiss President Karin Keller-Sutter, joined by Business Minister Guy Parmelin, flew to Washington on Tuesday, August 5, 2025, in a last-ditch effort to soften the 39% tariff imposed by President Donald Trump on Swiss exports, according to Reuters. The steep levy, announced last Friday and set to take effect on August 7, shocked Switzerland’s export-driven economy, prompting urgent action to protect industries like watchmaking, chocolate, and machinery. The trip follows a contentious 30-minute phone call between Keller-Sutter and Trump, described as “disastrous” by sources cited in the Financial Times, which led to the tariff hike from an expected 10% to one of the highest globally.
Swiss negotiators had believed they secured a 10% tariff deal, similar to the UK’s, after months of talks with U.S. officials, including Trade Representative Jamieson Greer, offering $150 billion in U.S.-bound investments, per SWI swissinfo.ch. “We had no indication even in the last hours before the call that it could end in this manner,” Economy Minister Guy Parmelin told local radio, expressing surprise at the outcome. Trump, focused on Switzerland’s $39 billion trade surplus with the U.S., rejected the offer, citing the deficit as a key issue, per The New York Times. “We have a $40 billion deficit with Switzerland,” Trump told CNBC, emphasizing his push to address trade imbalances.
The Swiss government is now preparing a “more attractive offer” to lower the tariff, with Parmelin noting potential concessions like increased U.S. liquefied natural gas purchases or further Swiss investments, per The Guardian. However, Keller-Sutter cautioned that U.S. imports already enjoy 99.3% free market access, limiting Switzerland’s leverage. “The call was not a success,” a government source told Reuters, denying reports of a quarrel but admitting Trump insisted 10% was insufficient. Swiss media, including Blick, labeled Keller-Sutter “too naive,” with 24 Heures calling the talks her “heaviest defeat.”
Key challenges facing Switzerland include:
- Economic Impact: The 39% tariff threatens jobs in watches, machinery, and chocolate industries.
- Trade Imbalance: Trump’s focus on the $39 billion U.S. deficit drives the high levy.
- Urgent Negotiations: Meetings with U.S. officials aim to secure a deal before August 7.
Economist Hans Gersbach of ETH Zürich warned that a 39% tariff could spark a recession, especially if pharmaceuticals, currently exempt, are included, per The Guardian. Swiss business leaders, like Swatch Group CEO Nick Hayek, urged Keller-Sutter to meet Trump directly, believing a substantial offer is needed. “Something marginal won’t be enough,” Gersbach told Reuters. As Switzerland races to renegotiate, the outcome will shape its economic future and global trade relations.
Sources: Reuters, Financial Times, The New York Times, The Guardian, SWI swissinfo.ch, CNBC, The Hill
