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What the TPP means for Swiss companies

The Trans-Pacific Partnership (TPP) is in place. The free trade agreement has been signed. However, it is still awaiting ratification. What impact will the agreement between 12 Pacific Rim countries have on Swiss exporters? A study by S-GE sheds some light.
Harbour of San Pedro.
The Trans-Pacific Partnership free trade agreement could spell trade disadvantages for Swiss exporters, particularly in the U.S. (our photo: port of San Pedro/Los Angeles).

In contrast to the Transatlantic Trade and Investment Partnership (TTIP), whose conclusion is still an open question, the ink is all but dry on the TPP. In both partnerships, the U.S. is playing an important, leading role. And it is for this reason that the free trade agreement concluded in connection with the TPP, which however still has to be ratified by the individual Member States, will have an impact on the competitiveness of Swiss exporters on Pacific markets. It has to be expected that in some cases this will place Swiss exporters at a serious disadvantage compared with competitors from TPP countries, according to a study prepared by the University of Zurich on behalf of Switzerland Global Enterprise (“Consequences of TPP for Swiss Companies”).

This mainly affects exports to the U.S., the destination for some 30% of Swiss exports. Of the 500 most important Swiss export products, the sale of which will be exposed to tougher competition in TPP countries as a result of the free trade agreement in connection with the Pacific partnership, a whopping 483 are destined for export to the U.S. On the Australian market, 11 products can expect trade disadvantages compared with competitors from TPP countries, and six on the New Zealand market. On the U.S. market, Swiss exporters are in addition facing growing competition from Japanese companies, and to some extent also from firms from Vietnam and Malaysia. On the Australian market, primarily Canadian companies stand to benefit from the TPP free trade agreement over Swiss competitors, and on the New Zealand market, U.S. companies.

The MEM industry would be particularly affected by potential discriminations. Of the 500 products mainly affected by the TPP agreement, 232 come from the MEM industry. Of the remainder, 66 stem from the chemical industry, 52 come from the plastics industry, 46 are precision instruments, 27 are textiles, and 22 have to do with agriculture. Barely affected, if at all, are exports by the pharmaceutical industry, the watch industry (wristwatches), and the beverage industry (sweetened beverages).

Switzerland Global Enterprise: Consequences of TPP for Swiss Companies (An Analysis of the Tariff Discrimination Potential of the Trans-Pacific Partnership against Swiss Companies and their Exports)

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