Switzerland and China Reach New Trade Agreement, 99.8% of Exports Tariff-Free
Nashnova编辑部
Switzerland and China agreed on August 20 to upgrade their free-trade agreement, granting zero tariffs on 99.8% of Swiss exports to China — up from roughly half under the old deal. With U.S. tariff policy still unresolved, the pact gives Swiss exporters a more certain route into their third-largest market.
What exactly does the upgrade cover?
The 2014 deal exempted only about half of Swiss exports to China. The new agreement pushes that to 99.8%. This means → watches, pharmaceuticals, and precision instruments — Switzerland's signature exports — enter China fully duty-free.
Beyond goods, Swiss investors gain improved market access in China. In plain terms = it is not just cheaper to sell; it is also easier to set up shop.
China is Switzerland's third-largest trading partner after the EU and the U.S., with bilateral trade at roughly CHF 34 billion (≈ $43 billion) last year.
Why sign now?
Last summer the Trump administration imposed a 39% tariff on Swiss goods — among the highest rates applied to any developed country. This means → Swiss exporters faced severe uncertainty on the U.S. side.
Switzerland did reach a preliminary deal with the U.S. capping tariffs at 15%, but that agreement has not yet become a binding legal text. In plain terms = the American promise is still unsigned.
Locking in zero tariffs with China is a hedge against U.S. policy risk — putting eggs in a second basket.
What is new on sustainability?
The upgraded deal includes a revised sustainability chapter. China agreed to stricter rules on labor rights and environmental standards.
Switzerland says China accepted, for the first time in any FTA, a reference to the Universal Declaration of Human Rights. This reflects a growing flexibility from Beijing on non-trade issues inside trade negotiations.
Still, writing a clause into an agreement and enforcing it are two different things — implementation and monitoring remain open questions.
What could still go wrong?
Formal signing is planned before year-end, after which each side must run domestic approval procedures.
In plain terms = the negotiators shook hands, but neither parliament has voted yet.
Whether the deal clears domestic processes — especially any political debate inside Switzerland — is the key checkpoint for it to actually take effect.
Content is for reference only, not financial advice.