Pressure exports
Camille Bloch asks the state to pay part of the American taxes
The Swiss chocolate maker proposes that Berne will take care of 20% of customs duties imposed by Washington. This controversial idea comes up against the opposition of economic associations.
“In unconventional situations, you have to think in an unconventional way,” said Daniel Bloch.
Adrian Moser
- Chocolate manufacturer Camille Bloch requests support for American customs duties. According to him, the Confederation should support 20% of import taxes.
- Economic associations oppose it. A widespread subsidy would strike the federal budget of 10 billion francs. Instead, companies should rather use partial unemployment.
- Daniel Bloch retorts that partial unemployment does not bring much to his business. He fears to lose access to the American market if he no longer provides this country.
“The chocolate market is very hard,” explains Daniel Bloch. Once you have lost its place in the distribution, you are no longer in the blow. ”
These are such reflections that pushed the chocolate factory Camille Bloch, 62, to launch a controversial idea. This is an unprecedented proposal in economic circles: according to him, the Confederation could take charge of part of the customs duties that the United States has recently led to Swiss exports.
Concretely, Daniel Bloch plans that the state will take care of about 20% of the import tax, that Donald Trump recently set at 39%. This measure would allow the Bernese Jura company to remain competitive in the face of its EU competitors.
EU exporters pay only 15% customs duties in the United States. For Camille Bloch chocolates, compensating for this disadvantage is essential. The company draws most of its turnover from the Ragusa and Torino bars and produced exclusively in Switzerland.
Taboo
Daniel Bloch’s proposal has a small political bomb. Direct state aid are generally poorly perceived in terms of economic policy, with the exception for the agricultural sector. In addition, the rules of theWorld Trade Organization (WTO) prohibit countries to subsidize the export of products.
It is therefore not surprising that Daniel Bloch’s idea arouses little enthusiasm in economic circles. “There is no industrial policy measures,” says Rudolf Minsch, chief economist of Economiesuisse, but a package of measures to strengthen the economic place. ” According to him, it is important to reduce the general cost load for companies.
The Swissmem association shares this position and presented a program in ten points. This includes various claims: refusal of new regulations, relaxation of exports of war equipment, drop in electricity prices, support for innovation and improve access to foreign markets. The association also requests, as an emergency, to extend partial unemployment from eighteen to twenty-four months.
For Daniel Bloch, it all sounds right. He wants to emphasize: “I am not someone who rushes towards the state as soon as things get bodied.” But asking for partial unemployment now would not be used much for your business. This would amount to reducing production and suspending deliveries to the United States, while employees would remain inactive at the cost of the community. “It would be more efficient and less expensive to use this money to continue exporting and keep the distribution channels.”
“We need a solution that allows us to save time,” notes Daniel Bloch, boss of the Camille Bloch chocolate company.
KEYSTONE
Use of chocolate maker
Daniel Bloch, who represents the third generation at the head of the family business of Courtelary, also evokes an advantage of which his sector of activity has long benefited: the chocolate lawwhich was in force until 2019.
The Confederation paid contributions to export to food producers to compensate for the high costs linked to the purchase of native agricultural raw materials. These payments are not in accordance with the WTO rules, they were replaced by contributions to milk and cereal producers, independent of exports.
According to Daniel Bloch, the Confederation could temporarily introduce compensation for customs duties for exports to the United States, in the spirit of the chocolate maker. He believes that such a promotion is legitimate because the United States under Donald Trump does not respect the WTO rules either.
It is obvious that small chocolate producers like Camille Bloch, which do not have production sites abroad, would thus benefit from more targeted aid than with partial unemployment. The subsidies help a company faced with cost problems. Partial unemployment is useful when market demand is low, as during the pandemic, a period when Camille Bloch also used this instrument.
However, it is not certain that an export subsidy of the chocolatier law type is more advantageous for the State than partial unemployment, contrary to what Daniel Bloch claims.
Special solution for the chocolate sector
An approximate calculation makes it possible to better understand the issues. Camille Bloch has a turnover of 1.2 million francs in the United States. If the Confederation supported 20% of American customs duties, this would represent around 250,000 francs per year. This sum is still reasonable.
But Camille Bloch represents only a hundredth of all Swiss chocolate exports to the United States. By extrapolating these customs subsidies to all of the industry, we reach 20 million francs per year.
And chocolate exports are only a fraction of all exports to the United States, which amount to some 50 billion francs. A 20% customs subsidy on these products would cost between 3 and 10 billion francs, depending on whether or not the pharmaceutical products are included, currently exempt from American customs duties. This would represent until the eighth of the federal budget.
As a comparison, the Confederation devoted nearly 200 million francs last year to partial unemployment benefits. If it is estimated that this figure will be multiplied by five due to American customs duties (Editor’s note: Several tens of thousands of jobs could be affected depending on the projections)the invoice for the Confederation would reach 1 billion francs per year.
Partial unemployment therefore costs much less than a generalized export subsidy. It is in particular for this reason that politicians like the president of the center, Philipp Matthias Bregy, are skeptical. “Support services must be targeted and should not be subject to the principle of watering can,” he said. Some companies would indeed be able to absorb customs duties themselves.
The president of the PS, Cédric Wermuth, welcomes the fact that companies show up with ideas. “It is possible that special measures are necessary for certain branches,” he says. But he also believes that it would be problematic that Switzerland officially subsidizes the customs policy of Donald Trump.
Daniel Bloch is aware of these difficulties. This is why he does not conceive of his proposal as a permanent solution, but rather as a transient regulation with a possible ceiling per business. “In unconventional situations, we must think in an unconventional way,” he concludes.
Translated from German by Olivia Beuhat.
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