After months of punishing trade tensions, the US and Switzerland announced a breakthrough deal on Friday that will slash tariffs to 15% from the brutal 39% rate imposed in August.
The agreement marks a stunning reversal for the Swiss economy, which saw exports to America collapse by 14% in the three months to September.
The deal came together after a high-level delegation of Swiss business leaders, including Rolex CEO Jean-Frédéric Dufour and Richemont Chairman Johann Rupert, met with President Trump at the White House last week.
US Trade Representative Jamieson Greer signaled that Swiss pharmaceutical companies, watchmakers, and gold refiners will receive major relief, while Switzerland has pledged $200 billion in new US investment.
Swiss watchmakers win breathing room
The watch industry was the hardest hit by the 39% tariff regime.
Swiss exports of wristwatches plummeted as luxury brands scrambled to either raise prices for American consumers or delay shipments to avoid the duties.
Rolex, Breitling, Patek Philippe, and Omega all felt the squeeze, with some houses rushing to ship inventory to the US before the tariffs kicked in during the summer.
The US accounts for roughly 20% of all Swiss watch exports, making America the single largest market for timepieces from Geneva.
The reduction to 15% won’t completely erase the damage, but it signals that the price-gouging and supply disruptions can finally ease.
Richemont’s Rupert told reporters that the 39% rate was “devastating” and threatened significant job losses across Switzerland.
With the new rate aligned to what the EU pays, Swiss watchmakers can now compete more fairly.
Prices for premium Swiss watches sold in America should start to normalize, easing inventory backlogs and restoring some competitive equilibrium.
The pharmaceutical and gold-refining sectors also got major wins. Switzerland is the world’s largest exporter of refined gold and a key player in specialty chemicals and precision medicines.
US Trade Representative Greer explicitly stated that Swiss pharma companies will be incentivized to build manufacturing plants in the United States as part of the deal.
That’s music to the ears of Swiss companies like Novartis and Roche, which can now price their US exports without the tariff penalty.
For American consumers, cheaper access to Swiss medications and medical devices becomes possible.
The political choreography: High-stakes business diplomacy
The breakthrough reveals Trump’s willingness to negotiate with allies while maintaining leverage.
Swiss business leaders understood that Trump responded to direct engagement; they went to Mar-a-Lago, made their case, and the President’s team came back with a deal.
The choreography matters because it signals that the administration will cut deals with strategic partners who show up and make their pitch.
Switzerland isn’t China or a geopolitical rival, so framing this as a bilateral trade agreement rather than a punitive tariff regime made political sense.
Switzerland has also committed to $200 million in new US investment across pharma, manufacturing, and other sectors, a quid pro quo that sweetens the deal for Washington.
That investment helps offset the narrative that America is simply capitulating to pressure.
Meanwhile, the 15% rate positions Switzerland favorably compared to some other nations, showing allies that cooperation gets rewarded.
The question now is whether other countries, Canada, Mexico, and EU members will follow Switzerland’s playbook and negotiate their own tariff reductions.
If so, Trump has effectively created a two-tier system where engaging dealmakers get better terms than holdouts.
For Swiss exporters, the relief is immediate: watches, pharmaceuticals, and refined gold will all see reduced friction in the American market starting now.
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