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The US Imposes High Tariffs on Switzerland and Several Other Countries: Impact and Global Market Reactions

1. Switzerland Faces 39% Tariff Impact

Tariff Measures: The Trump administration announced on July 31, 2025, a 39% tariff on Swiss goods, one of the highest rates the US has recently imposed on a trading partner. It is expected to take effect on August 7.

Economic Impact on Switzerland:

Stock Market Volatility: The Swiss SMI index fell 1.9% after the announcement, before narrowing the decline to 0.2%.

Industry Impact: Switzerland's machinery, watchmaking, and pharmaceutical industries are severely impacted, potentially threatening tens of thousands of jobs.

GDP Risk: Economists estimate that if the tariffs are in place for a long time, Switzerland's GDP could decline by 0.3%-1%.

Swiss Government Response:

Considering increasing US liquefied natural gas (LNG) imports to narrow the trade deficit.

The Federal Minister of Economics expressed willingness to travel to Washington for negotiations, but time is tight.

2. European stock markets rebounded overall, while Switzerland performed weakly.

The STOXX 600 index rose 0.9%, with major indices in Germany, France, and the UK all recovering, but the Swiss market was dragged down by tariffs.

Bank stocks boosted European stocks: UK bank stocks (such as Lloyds Banking Group) surged 8% on the favorable ruling, offsetting some tariff concerns.

3. The Trump administration imposed new tariffs on multiple countries.

Canada, New Zealand, South Africa, and other countries also face new tariffs ranging from 25% to 40%.

South African President Cyril Ramaphosa criticized the US tariffs as "unreasonable," as South Africa already grants duty-free access to 77% of US goods.

India may be the next target: Trump previously threatened to impose tariffs on Indian goods to narrow the US-India trade deficit.

4. Reshaping the global trade landscape.

Supply chain shifts: Some companies (such as Apple) have already shifted production from China to India, but the new tariffs could disrupt this trend.

Long-term impact:

US tariffs could drive up global inflation and weaken economic growth.

Countries are accelerating their search for alternative markets, such as the EU and India strengthening trade cooperation.

5. Subsequent Focus

Can negotiations achieve a breakthrough before the Swiss tariffs take effect on August 7?

US midterm elections: If Trump is re-elected, high tariffs may become permanent; if Biden wins, strategy may be adjusted.

Summary: The new US tariff policy has impacted export-dependent countries like Switzerland, but global markets have temporarily absorbed some of the impact. In the long term, trade protectionism may accelerate supply chain restructuring and trigger more economic friction.