US tariffs hit Swiss exports, rating stays ‘AAA’: Fitch

The US’ decision to impose 39 per cent tariffs on a broad swathe of Swiss exports poses a significant shock to Switzerland’s competitiveness and will likely reduce its large current account surplus, Fitch Ratings said. The agency estimates Switzerland will face an effective tariff rate of 22.1 per cent, among the highest for advanced economies, reflecting its heavy trade reliance.

The US is Switzerland’s second-largest export market after the EU. Exports are dominated by high-value goods, with pharmaceuticals accounting for 30 per cent of shipments to the US in 2024. Pharmaceutical sales to the US averaged 2 per cent of Swiss nominal GDP over the past decade, underscoring their importance to growth, Fitch Ratings said in a release.

Authorities are considering targeted support for industries hit by tariffs, which could raise fiscal costs. Still, Fitch affirmed Switzerland’s ‘AAA’/Stable rating. It expects Switzerland to seek greater foreign direct investment (FDI) in the US to secure tariff relief, rather than retaliating with tariffs of its own. Switzerland scrapped most industrial import tariffs in 2024, meaning nearly all US goods already enter duty-free.

Fitch Ratings said the US’ 39 per cent tariffs on Swiss exports will hit competitiveness, pushing Switzerland’s effective tariff rate to 22.1 per cent, one of the highest among advanced economies.
Authorities may aid impacted sectors, raising fiscal costs.
Fitch affirmed Switzerland’s ‘AAA’/Stable rating, noting FDI in the US may offset losses.

Fitch cautioned that reduced external competitiveness could weigh on the economy over time, but the likelihood of a rating downgrade remains low.

Fibre2Fashion News Desk (HU)