Swiss President Karin Keller-Sutter and Economy Minister Guy Parmelin flew to Washington on Tuesday in what the government said was a last-ditch effort to avoid President Donald Trump's 39 percent tariffs on U.S. exports.
The increased US tariffs, which rose from an initial 31 percent announced in April, caused alarm in Switzerland after they were announced on Friday.
The new tariff level is due to come into effect on Thursday.
As part of their visit, Keller-Sutter and Parmelin “will soon organize meetings with American officials and hold talks with the aim of improving the tariff situation for Switzerland,” the government said.
The statement did not indicate which US administration officials they would meet with in Washington or whether a meeting with Trump was planned.
A source familiar with the Trump administration's thinking said they were confident that a deal could be reached with Switzerland if it quickly responded with a better offer.
“There have been some difficulties, but that could end if the Swiss offer something significant,” the source said, referring to Trump's call with Keller-Sutter on Thursday evening.
“That's a big trade deficit, especially when you take into account the population,” the source added.
In an interview with CNBC on Tuesday, Trump mentioned the conversation with Keller-Sutter, adding that he was concerned about the U.S. trade deficit with Switzerland.
“Listen, I did something with Switzerland recently,” he said, referring to his phone call with Keller-Sutter. “The woman was polite, but she didn't want to hear anything, and they basically didn't pay any fees,” he told the television station.
“And I said, you and I have a $41 billion deficit, madam… and you want to pay 1 percent tariffs. I said, you're not going to pay 1 percent, we're going to lose, because I view the deficit as a loss.”
The Swiss government held an emergency meeting on Monday to discuss how to respond to the tariff hikes and said it was prepared to make a “more attractive offer” to the United States.
It is also ready to continue negotiations after the August 7 deadline.
Bern did not provide details about what additional incentives might be offered to reach a more favorable agreement, but stressed that he was not considering any countermeasures against the United States.
Parmelin has previously said Switzerland is considering increasing purchases of liquefied natural gas (LNG) from the United States, with further Swiss investment in the United States also an option.
The aim of Keller-Sutter and Parmelin's visit was to present “a more attractive offer to the United States in an attempt to reduce the level of reciprocal tariffs on Swiss exports, taking into account US concerns,” the government said on Tuesday.
Some Swiss businessmen, including Nick Hayek, CEO of watchmaker Swatch Group, have called on Keller-Sutter to visit Washington to directly negotiate with Trump.
Economists warn that the 39 percent trade barrier would be a major blow to Switzerland's export-driven economy by restricting access to the biggest overseas market for its watches, machinery and chocolate.
Hans Gersbach, an economist at the KOF Swiss Economic Institute at ETH Zurich, said the Swiss delegation would have to make a strong offer to delay the 39 percent tariff, and the visit represented a last-ditch effort to negotiate a reduction in the import duty.
“Something small won't be enough – it has to be a significant offer that Trump can present to his supporters as a negotiating victory,” Gersbach said.
“Keller-Sutter and Parmelin should meet with Trump and talk to him directly. He is the decision maker,” added Gersbach, who believes the chances of success are reasonable.
According to him, the Swiss government is aware of the seriousness of the situation and is making every effort to reach an agreement.
“A 39 percent tariff for Switzerland, especially given that the EU has agreed on a 15 percent rate, would be an immediate shock
Sourse: breakingnews.ie
