Analysis
Trump 2.0 – What Swiss SMEs need to know
Nov 4, 2025
The US government has decided to increase tariffs. However, it is still unclear which changes will be implemented and how. Our article highlights the potential effects for exporting companies and provides initial recommendations for action.
The new US President Donald Trump has decided to introduce a series of tariff increases (see Box 2). As all the details are not yet known and further increases may follow, SMEs are currently very uncertain about the extent to which they will be affected. It is also unclear which future US measures will affect Swiss products.
Discuss geopolitical influences, international business opportunities, and challenges with internationalization experts and industry colleagues. Register for the International Trade Forum and gain valuable insights into the export business.
Tariff increases and their impact on Swiss companies
To be able to better assess the risk of future tariff increases on Swiss products, it is important to be aware of the different reasons for tariff increases.
Politically motivated tariffs
Some of the tariff increases announced are intended to exert pressure on individual countries to achieve certain political objectives, e.g. in the area of migration or drugs. These tariffs include the announced and temporarily suspended import tariffs of 25% on goods from Mexico and Canada as well as the additional tariffs of 10% on goods from China. These tariffs are likely to be temporary if the countries concerned comply with the USA's demands.
The risk of these tariffs for Switzerland appears low, as there are currently no major political conflicts between the two countries. However, this can change quickly. In addition, Swiss companies with subsidiaries in affected countries may already be affected by such tariffs.
In addition to pharmaceuticals, there were trade surpluses with the USA, particularly in watches and jewelry, MEM and medtech products (including semiconductors), coffee (capsules), chocolate, and cheese. In these sectors, there is a risk that the US will apply higher tariffs in the future.
Reciprocal tariffs
Finally, the third type of tariffs announced, reciprocal tariffs, represent a fundamental departure by the USA from WTO principles. The latter state that tariff relief granted to a country outside a free trade agreement must also be granted to other countries (most-favored-nation principle). The USA has announced that it will increase tariffs on products on which a country itself charges higher tariffs than the USA. The fact that each country is likely to have different tariffs in the future violates the principle of most-favored-nation treatment.
Although Switzerland has abolished industrial tariffs (Chapters 25–97 of the Customs Tariff, with the exception of some products in Chapters 35 and 38) and there are no immediate fears of tariff increases in this area, reciprocal tariffs pose a major threat to Switzerland and its SMEs in the medium to long term.
On the one hand, Switzerland imposes sometimes high tariffs on agricultural products and foodstuffs (Chapters 1–24 of the Customs Tariff) compared with other countries and has a significant trade surplus with the USA for individual products (particularly coffee, chocolate, and cheese). For these exports, which amounted to around CHF 1.6 billion last year, there is a risk of future tariff increases. On the other hand, President Trump has announced that he will consider European VAT as an import duty. This could mean that the USA will raise tariffs on industrial products to around 8.1%.
Risks also arise from possible countermeasures by other countries in response to US tariff increases. As early as 2018, the EU took countermeasures in response to the steel and aluminum tariffs introduced by the USA, which also affected Switzerland.
In the longer term, it is of great importance whether such countermeasures by other countries are WTO-compliant or not, or whether the principle of most-favored-nation treatment is respected. The move away from the principle of most-favored-nation treatment makes it easier for large markets such as the USA to impose their own economic and power-political demands with tariffs.
Reduction of the trade deficit
Another part of the announced tariff increases seems to be aimed at reducing the US trade deficit, like the increase to tariffs on steel and aluminum (which also apply to Swiss companies), on vehicles, pharmaceuticals and semiconductors, and on imports from the EU. These tariffs could have a longer-term impact, especially if they do not lead to a substantial reduction in the trade deficit (as in Trump’s first term).
In 2024, Switzerland reported a trade surplus of just under CHF 40 billion in goods trade with the USA (by contrast, there was a deficit in services trade). Pharmaceutical products accounted for most of this surplus, although Switzerland also recorded a surplus in other product groups (see figure).
Discuss geopolitical influences, international business opportunities, and challenges with internationalization experts and industry colleagues. Register for the International Trade Forum and gain valuable insights into the export business.
Tariff increases and their impact on Swiss companies
To be able to better assess the risk of future tariff increases on Swiss products, it is important to be aware of the different reasons for tariff increases.
Politically motivated tariffs
Some of the tariff increases announced are intended to exert pressure on individual countries to achieve certain political objectives, e.g. in the area of migration or drugs. These tariffs include the announced and temporarily suspended import tariffs of 25% on goods from Mexico and Canada as well as the additional tariffs of 10% on goods from China. These tariffs are likely to be temporary if the countries concerned comply with the USA's demands.
The risk of these tariffs for Switzerland appears low, as there are currently no major political conflicts between the two countries. However, this can change quickly. In addition, Swiss companies with subsidiaries in affected countries may already be affected by such tariffs.
Reduction of the trade deficit
Another part of the announced tariff increases seems to be aimed at reducing the US trade deficit, like the increase to tariffs on steel and aluminum (which also apply to Swiss companies), on vehicles, pharmaceuticals and semiconductors, and on imports from the EU. These tariffs could have a longer-term impact, especially if they do not lead to a substantial reduction in the trade deficit (as in Trump’s first term).
In 2024, Switzerland reported a trade surplus of just under CHF 40 billion in goods trade with the USA (by contrast, there was a deficit in services trade). Pharmaceutical products accounted for most of this surplus, although Switzerland also recorded a surplus in other product groups (see figure).
In addition to pharmaceuticals, there were trade surpluses with the USA, particularly in watches and jewelry, MEM and medtech products (including semiconductors), coffee (capsules), chocolate, and cheese. In these sectors, there is a risk that the US will apply higher tariffs in the future.
Reciprocal tariffs
Finally, the third type of tariffs announced, reciprocal tariffs, represent a fundamental departure by the USA from WTO principles. The latter state that tariff relief granted to a country outside a free trade agreement must also be granted to other countries (most-favored-nation principle). The USA has announced that it will increase tariffs on products on which a country itself charges higher tariffs than the USA. The fact that each country is likely to have different tariffs in the future violates the principle of most-favored-nation treatment.
Although Switzerland has abolished industrial tariffs (Chapters 25–97 of the Customs Tariff, with the exception of some products in Chapters 35 and 38) and there are no immediate fears of tariff increases in this area, reciprocal tariffs pose a major threat to Switzerland and its SMEs in the medium to long term.
On the one hand, Switzerland imposes sometimes high tariffs on agricultural products and foodstuffs (Chapters 1–24 of the Customs Tariff) compared with other countries and has a significant trade surplus with the USA for individual products (particularly coffee, chocolate, and cheese). For these exports, which amounted to around CHF 1.6 billion last year, there is a risk of future tariff increases. On the other hand, President Trump has announced that he will consider European VAT as an import duty. This could mean that the USA will raise tariffs on industrial products to around 8.1%.
Risks also arise from possible countermeasures by other countries in response to US tariff increases. As early as 2018, the EU took countermeasures in response to the steel and aluminum tariffs introduced by the USA, which also affected Switzerland.
In the longer term, it is of great importance whether such countermeasures by other countries are WTO-compliant or not, or whether the principle of most-favored-nation treatment is respected. The move away from the principle of most-favored-nation treatment makes it easier for large markets such as the USA to impose their own economic and power-political demands with tariffs.
