Switzerland and China have finished talks on a trade deal that will remove tariffs on 99.8% of Swiss exports to China. Swiss President Guy Parmelin and Chinese Minister of Commerce Wang Wentao announced the agreement on Thursday in Bern. This update to the free trade agreement, in place since 2014, aims to improve trade relations between the two countries.
Key Details
Under the new terms, almost all Swiss exports, such as watches, pharmaceuticals, and precision instruments, will enter China without tariffs. The deal also seeks to improve access for Swiss investors in China. Before this agreement, just over half of Swiss exports enjoyed duty-free status. The updated deal is expected to be signed by the end of this year.
The agreement includes rules on trade facilitation, digital trade, competition, and economic cooperation. It also strengthens labor rights and environmental standards in a revised sustainability chapter. The Swiss Federal Department of Economic Affairs stated that the deal responds to ongoing trade tensions between the U.S. and China, which have impacted Switzerland's export-driven economy.
Background
China is Switzerland's third most important trading partner, after the European Union and the United States. The two countries have held five rounds of talks since 2024 to finalize this updated trade agreement. This move is seen as a way for China to strengthen ties with Europe amid its rivalry with the U.S.
The removal of tariffs is likely to help Swiss exporters, especially in the luxury goods and pharmaceutical sectors. This will enhance their competitiveness in the Chinese market. Investors will be looking for the formal signing of the agreement later this year, which will pave the way for increased trade between the two countries.
Based on reporting by: livemint.com, swissinfo.ch