The 39% tariff on Swiss Exports to the U.S. - Expert analysis

The newly imposed US tariffs are expected to substantially affect Swiss exporters and drive up consumer prices in the United States. Fabrizio Colella, Assistant Professor at the Faculty of Economics at USI, and his colleagues Rafael Lalive and Sofia Schroeter from the University of Lausanne analyse the consequences of this measure and propose viable ways to protect the Swiss economy.

The United States has recently rolled out a wave of new tariffs on a range of trading partners, targeting specific products and countries. These tariffs are striking because they are not broad, multilateral measures under WTO rules, but bilateral, punitive-style actions reminiscent of an era thought to be long forgotten. Among them is the new 39% tariff on Swiss exports to the U.S., which marks a sharp deviation from the global trade framework within which Switzerland usually operates.

Two big questions now arise: Who in Switzerland will feel the hit? And how much will this curb exports? One way to approach it is by looking at the share of each canton’s exports going to the U.S, though this would not account for the overall scale of a canton's exports. Another is by looking at exports to the U.S. per worker, which highlights the role of high-value sectors like machinery and precision instruments.

Researchers at the University of Lausanne (UNIL) and the Università della Svizzera italiana (USI) have constructed a map - see this news' picture - showing 2022 exports to the U.S. per worker by canton, excluding pharmaceuticals and chemicals, which dominate headline figures but employ fewer people. This map highlights how each canton is directly exposed to the new tariff.

Who in Switzerland will feel the hit?

Geneva and Ticino are highly exposed cantons, but this likely reflects niche high-value goods such as gold, luxury watches, and specialized machinery rather than volume-heavy industry. Strongly exposed cantons are manufacturing-intensive regions with strong machinery, precision instruments, or watchmaking sectors (e.g., Neuchâtel, Jura, Solothurn, Schaffhausen). Nidwalden’s exposure is consistent with its aerospace and precision engineering firms. Their economies are more vulnerable to the 39% U.S. tariff because a large share of value-added per worker is tied to U.S. sales.

Medium exposure cantons with diversified industry (e.g., St. Gallen, Thurgau, Aargau) sit in the CHF 10,000–20,000 per worker range. They will feel the tariff but have broader export portfolios to other markets. Low-exposure cantons, service-oriented or domestically oriented cantons (e.g., Vaud, Bern) show low per-worker exposure to U.S. goods exports once pharmaceuticals are excluded. For them, the macro impact will be limited, though specific firms may still be hit hard.

Overall, the burden of the tariff will likely be geographically concentrated in smaller, manufacturing-heavy cantons. These regions could face disproportionate job and output risks unless firms quickly redirect exports to other markets or absorb price shocks.

How much will this curb exports?

How much this tax will curb exports is not so easy to answer. Historically, unilateral trade taxes have become rare in modern commerce, so direct evidence is limited. But ongoing research at UNIL and USI offers a clue: using data from COVID-era measures that disrupted goods flows, such as border closures, and detailed bilateral import and export data, they find that unilateral restrictions tend to depress trade less than bilateral tit-for-tat measures.

That’s the dilemma today. Switzerland could retaliate with its own tariff, but a bilateral tariff war would likely push exports down even further. Retaliation would be costly. Supporting firms most affected by the tariff, for example, by reusing Covid-era policies such as short-time work, is a viable alternative strategy that can be highly successful if the crisis is short-lived.