Customs law: interview with the director of Economiesuisse

Madame Rühl, can you estimate the extent of the damage that the Droits de Customs de Donald Trump to Switzerland?

We estimate that around 100,000 jobs are directly threatened by American customs duties. They constitute a considerable burden for the Swiss economy. We must now make a common front and consolidate our economic position.

100,000 jobs? If all these positions disappear, the unemployment rate will double and exceed 5%.

No, it would be alarmist. 100,000 is the number of jobs directly concerned, all branches combined, which produce for the American market, including the pharmaceutical sector. Some of the affected companies will continue to deliver to the United States despite high customs duties, others will cut their margin or use partial unemployment. This figure nevertheless reveals the extent of the potential consequences of the current situation.

Concretely, how many places does the situation become dangerous?

It depends on many factors. What is certain is that if customs duties were to last, part of these directly affected jobs would disappear. However, a large part could probably be preserved thanks to restructuring and reorientations. The EPFZ believes that American customs duties could eliminate up to 15,000 long -term jobs.

The Swiss economy has remarkably resistant in recent years to the financial crisis, the pandemic and the energy crisis. Are your warnings not exaggerated?

I hope so. The Swiss economy is resilient. Most companies know how to manage such challenges very well and turn to other markets. But the impact of customs duties remains heavy, especially for companies active in the field of watchmaking, technology and food.

Last week, several economic leaders went to Washington with the Federal Council. Why wasn’t you?

We maintain close contact with the Federal Council and the Federal Authorities. But the Swiss economic place is going through a difficult period and we need to quickly find solutions with the Americans. As an association, we are unable to guarantee investment safety. This is the reason why representatives of companies exporting or investing in the United States participated in this meeting.

Fredy Gantner and Marcel Erni, from the financial group Partners Group, are just one. Both engage in the front line against the agreement between Switzerland and the EU. Do you currently lose your leader role in the economy?

No not at all. We certainly have a different position in European policy, but Partners Group remains a company anchored on the American market. It is logical that she will play her contacts in favor of Switzerland.

Federal advisers and CEOs present themselves together, almost as Donald Trump is used to doing so. Do we play his game?

In Switzerland, the economy and the Confederation have always maintained good exchanges. This collaboration is not new and has always proven itself. In the current stress situation, these contacts have further intensified.

On the interior policy side, you should however rejoice. This crisis considerably increases your chances of failing the 2^e Edition of the initiative for responsible multinationals and to win the vote on European treaties.

The future will tell us. In any case, it is now absolutely necessary to a train of measures to relieve companies in Switzerland. Unlike the situation with the United States, we have this possibility in our hands.

You claim less costs, less bureaucracy and less regulations for the economy. These claims have been hearing them for years. Faced with this new challenge, don’t you have any other solutions to offer?

The central question is to determine which measures effectively support companies. The response of entrepreneurs is clear: avoid regulatory constraints and additional costs, while reducing bureaucracy where it is possible. It is also necessary to continue the development of the free trade network and stabilize relations with the EU.

Before taking up your position at Economiesuisse, you were a commercial diplomat. How do you explain such a disappointing result in customs negotiations?

I find it painful this constant research of a culprit. In Switzerland, each crisis automatically triggers internal quarrels. We should rather seek the best possible solution together. The Federal Council’s approach seems right to me. Our first offer was also accepted by three members of the American firm. Even today, we have no choice but to improve our proposal and to multiply the dialogue channels with the American government.

What should Switzerland offer to Trump?

There resides all the difficulty. We do not know what it would take to obtain the agreement of the American president. Trump’s behavior is simply unpredictable. This is why we must show creativity and examine solutions that we would not propose in our typically Swiss approach. If these solutions come directly from the economy, it is even better.

Should Switzerland reduce its agricultural customs duties and import more American beef?

Even if each of us ate an American steak per day, that would not be enough for a population of our size. You have to look for solutions where volumes are important.

Lufthansa envisage to buy your future Boeing via Switzerland. This operation aims to reduce the American trade deficit. Is it really useful?

We should explore all tracks and be creative.

Trump’s sons invested in an American start-up that provides energy and computer capacities to cryptocurrency specialists. Donald Trump has his own cryptocurrency. Should we invest massively in this sector to attract your good graces?

No. Switzerland should certainly not venture into such gray areas.

What should be the extent of the overall revised package?

An agreement with the United States will have a cost. Nothing is free. We will have to weigh the pros and cons. Will we accept the price of this new agreement or will we prefer to undergo higher customs duties?

According to polls, the majority of the population refuses to give in to pressure. However, political and economic leaders are exactly the opposite.

I understand that we can say that we must now stand up to Trump. But we must keep our position in mind: we are politically and geographically small, economically average. We are condemned to find a solution, as unsatisfactory as it is. Like all the others elsewhere. Even the EU, however much larger, had to reach out to conclude an agreement.

L’pharmaceutical industry represents half of Swiss exports and therefore constitutes a major risk for the national economy. Should we intervene in this sector?

We cannot control this. The Swiss economic structure has developed historically because this sector is very competitive. There is certainly a risk in this area, which we have become more aware with the policy of the American president. But we are playing in a free market economy and we certainly do not want to dictate to pharmaceutical companies what they must do.