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Protectionism vs Globalization: Four world regions in focus

Which markets are opening up, which are being closed by high tariffs or other protectionist measures? A survey of our Swiss Business Hubs (SBH) heads gives an indication of the situation in the US, the Gulf States, Germany and China.  

Turbulent times for Swiss exporters between globalization and protectionism
Turbulent times for Swiss exporters between globalization and protectionism

What is the tendency in your country or region? Is free trade being promoted or are protectionist measures increasing?

Chris Watts, Head of SBH Middle East: The Gulf States are already heavily integrated into the global economy and display a clear trend towards opening the market. The Gulf States are also heavily dependent on this: over 90 percent of the food is imported from abroad. In addition, a lot of technology is still imported from the West, and is increasingly also coming from China and the Far East. The Gulf States are now highly dependent on foreign countries and cannot afford to introduce protectionism.
Caroline Blaser, Head of SBH USA: It hasn’t escaped anyone’s attention that the US has announced and enforced import tariffs. In some cases, certain direct investments have been blocked. There is also an anti-globalization rhetoric coming from the administration. The US is tending towards protectionism. 
Yves Morath, Head of SBH China: China has been clearly committed to positioning itself internationally for market opening since integrating itself into the global market economy. On the other hand, Chinese policymakers are convinced that short-term and medium-term protectionist measures are needed keep China competitive.
Britta Thiele-Klapproth, Head of SBH Germany: Germany is undeniably export world champion, and of course we are doing everything to continue winning this World Cup. That is why I would say very clearly that the tendency is towards free trade.

 

What barriers do Swiss exporters have to overcome in your market?

Chris Watts, Head of SBH Middle East: A certain barrier exists regarding company commitment. Companies have to get behind their business in the Gulf States, or they have little chance of success.
Caroline Blaser, Head of SBH USA: The barriers in the US market are not due to the latest developments. There have always been barriers at the regulatory level. They are very high; the US generally has a very complex system.
Yves Morath, Head of SBH China: The limitations are that China prioritises the considerations of Chinese companies in certain areas. China sets standards that are different than those abroad. This of course has consequences for foreign companies that do not produce in China. There is a certain risk that they will be pushed out of the market. 
Britta Thiele-Klapproth, Head of SBH Germany: I see no barriers. Bilateral trade relations are very strong. There are no barriers to speak of.

Which measures make it easier for Swiss SMEs to export to your market?

Chris Watts, Head of SBH Middle East: The free trade agreement gives us a very regulated and good relationship, as well as good access to the markets in the Gulf States. The implementation of this free trade agreement was still fraught with problems, so it was delayed. Now it is a question of showing Swiss companies what is possible within this agreement, and that they endeavour to obtain the corresponding customs exemptions.
Caroline Blaser, Head of SBH USA: Looking at the market opening, I would rather use the word “deregulation”. The Trump administration is certainly a business-oriented administration that has heavily favored deregulation. This was also seen with the tax reform and is certainly an opportunity for Swiss companies. 
Yves Morath, Head of SBH China: Overall, China is opening the market in certain areas. China has signed a free trade agreement with Switzerland, which is of particular relevance to Switzerland. It came into force in July 2014, is used extensively and offers Swiss commerce in China an effective competitive advantage.
Britta Thiele-Klapproth, Head of SBH Germany: We have taken a big step forward when it comes to facilitation – both financially and in terms of time – by updating the recognition of conformity assessment. This makes it easier for Swiss exporters to bring their product to the German or EU market.

Study for Swiss exporters

What threats and opportunities await internationally active Swiss companies in the area of tension between globalization and protectionism? This question is answered by economics professors Simon J. Evenett (University of St. Gallen) and Patrick Ziltener (University of Zurich) in their study for Switzerland Global Enterprise (S-GE). To the study

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