Switzerland Rejects US Forced Labour Tariff Findings and Responds to Trade Probe
Swiss Government's Response to US Forced Labour Tariff Probe
Background: US Tariff Proposals and Forced Labour Allegations
ZURICH, June 3 (Reuters) - The Swiss government on Wednesday rejected U.S. findings on how dozens of economies, including Switzerland, deal with goods produced by forced labour, a probe that prompted Washington to threaten trading partners with fresh tariffs.
The Trump administration has proposed imposing additional duties of 10% or 12.5% on imports from 60 economies after concluding that their failures to curb trade in goods made with forced labour are unreasonable and hamper U.S. commerce. The proposal is designed to help rebuild U.S. President Donald Trump's emergency tariffs, which were struck down by a U.S. Supreme Court decision in February.
Swiss Government and Industry Reactions
Rejection of US Findings
The Swiss economy ministry said U.S. industry was not being harmed by Switzerland's practices and rejected the conclusions set out by the U.S. Trade Representative, or USTR.
USTR has recommended the 12.5% tariff for Switzerland and others who have not enacted an import ban on goods made using forced labour. The EU faces a 10% rate.
Industry Perspective
Rudolf Minsch, chief economist at Swiss business lobby economiesuisse, said the forced labour issue was "completely unfounded" but the move was expected because Washington was looking for a way to maintain the tariffs due to expire.
The fact Switzerland was facing slightly higher tariffs than the EU appeared manageable, he said, noting the difference could be passed on to customers or saved by using alternative routes.
"So from that point of view, it's not decisive," Minsch said. "It is perhaps simply somewhat annoying."
Expected Impact of Tariffs
The economy ministry said it expected the 12.5% duties would replace separate 10% tariffs due to expire on July 24.
Wider Trade Investigation and Future Outlook
Parallel Industrial Capacity Investigation
The labour probe ran alongside an investigation alleging that countries, among them Switzerland, were running excess industrial capacity to the detriment of U.S. industry.
Switzerland rejects this, but the ministry said it expected additional tariffs to arise from that as well. The results of that part of the investigation are expected in the coming weeks.
Recent Tariff History and Ongoing Negotiations
Trump last year hit Switzerland with 39% additional tariffs, the highest on any country in Europe.
Switzerland in November sealed an initial agreement with the United States that slashed those tariffs, and it has been working since then to formalize the deal.
Long-Term Economic Relations
The ministry said it wanted an accord to regulate bilateral economic relations over the long term, regardless of legal and political developments within the U.S.
(Reporting by Dave Graham and John Revill; Editing by Hugh Lawson)
