The Swiss president wants to talk about the trade issue happening globally. What could it be about, though? Some of the most significant events take place distant from flashing cameras and bustling capitals in a world full of breaking news and headlines. Decisions that have the potential to impact alliances, change the course of international politics, and shape economies are sometimes taken in private meetings with a select group of important individuals. One such instance is currently taking place in private between two nations that don’t usually command the attention of the world.
Swiss politicians head to Washington in anticipation of Trump’s 39% tariff
Swiss President Karin Keller-Sutter will meet U.S. Secretary of State Marco Rubio on Wednesday, with Washington potentially seeking more energy and defence purchases to clinch a deal that would avert a crippling 39% tariff on Swiss imports. Switzerland was stunned by U.S. President Donald Trump’s decision last week to apply the steep rate, among the highest announced since he launched his global trade reset.
This threatens to do major damage to its export-oriented economy. Keller-Sutter and Business Minister Guy Parmelin flew to Washington on Tuesday for last-minute negotiations aimed at reducing the tariffs before they go into effect on Thursday. The Trump administration, meanwhile, is looking for Switzerland to purchase more energy and defence products, according to a Swiss source familiar with the discussions.
As Switzerland requests tariff relief from Washington, Parmelin refers to an LNG contract
Parmelin had already raised the possibility of Switzerland buying U.S. liquefied natural gas (LNG) as one of the options to secure a better deal, but will that deal fall through since these decisions are affecting a global scale? Parmelin said,
“Look at the European Union, they promised to buy LNG. Switzerland imports LNG too — maybe that’s one path.”
Under a deal the EU struck with Washington last month to secure a 15% tariff rate, Brussels agreed to buy $750 billion of LNG, oil, and nuclear energy products over the next three years. Although the EU made no formal commitment to buy more U.S. arms, it did indicate to U.S. negotiators there would be an increase in defence spending in line with higher NATO commitments, which would benefit U.S. suppliers.
What both parties stand to gain from these ostensibly quiet talks
There are obviously more serious issues at play, even though the discussions are being conducted under the guise of economic cooperation. The United States has been putting increasing pressure on Switzerland because of its continued financial connections with nations that are subject to American sanctions. Swiss officials, however, have expressed worry about the growing American scrutiny of their banking industry.
Both nations may leave the negotiations with improved diplomatic relations and new trade commitments. Failure, however, can result in market-shaking policies like tariffs. The stakes are therefore bigger than they might seem at first glance. But, having said that, it is unpredictable as to how it will unfold; the truth is the Trump tariffs really hit Swiss watch stocks hard enough for them to request a meeting.
Trump reverses on Swiss tariff deal after tense call with Keller-Sutter
The Swiss government declined to comment on the meeting or whether other meetings with U.S. officials were planned. Following talks with Treasury Secretary Scott Bessent and U.S. Trade Representative Jamieson Greer, Switzerland had agreed to a draft agreement with the United States in early July that was reported to include a 10% tariff rate. Trump’s U-turn on Friday, however, followed what some U.S. officials said was a fraught telephone call with Keller-Sutter. Switzerland is not the only nation with these issues; global markets have dropped after Trump’s latest tariff move.
GCN.com/Reuters