Swiss President Karin Keller-Sutter and economy minister Guy Parmelin are flying to the US for talks they hope will secure a stay of execution for the 39% tariff due to take force on Thursday.
Ms Keller-Sutter has been facing criticism for botching a phone call with US President Trump on Thursday evening last week, the day before his administration said it would impose an additional 39% tariff on all goods excluding pharmaceuticals from this Thursday.
The trip to Washington, according to a Swiss government spokesperson, is to “facilitate meetings with the US authorities at short notice and hold talks with a view to improving the tariff situation for Switzerland.”
In an interview with CNBC today, Mr Trump appeared to speak about the call with Ms Keller-Sutter last Thursday, but did not refer to her by name or title.
“The woman was nice, but she didn’t want to listen,” he began, before recounting the conversation: We have a $41 billion deficit with you, Madame … and you want to pay 1% tariffs. I said, ‘you’re not going to pay 1%'”.
Prior to August 1’s shock announcement of the 39% tariff, Swiss officials had been briefing that a trade deal built around a headline rate of 10% had been agreed between negotiators.
It has been reported that this agreement was personally rejected by Mr Trump on the day of the call with Ms Keller-Sutter.
The Financial Times reports that Ms Keller-Sutter held a “disastrous” phone call with Mr Trump on Thursday evening, citing multiple people familiar with the situation.
The shock of the 39% tariff has been made all the more acute because business leaders had been reassured that negotiations were going smoothly with Trump administration.
As recently as July, Ms Keller-Sutter said that, unlike many countries, she had access to Mr Trump’s administration and was confident of securing a deal.
Swiss watchmakers have been exporting record levels of stock to the United States ahead of deadlines when higher tariffs are likely to be imposed.
This was also seen previously with a sharp spike in exports in April when the value of exports to the United States rocketed by 50% to CHF 851 million, but whiplashed back to just CHF 268 million in May, a 25% drop year-on-year.
A major luxury watch and jewellery group in the United States told WatchPro this week that it believed there is around one month’s worth of additional inventory in the country.
That was ahead of a second major airlift positioning watches in the United States before Thursday’s deadline. The current 10% tariff will be charged on any cargo already in transit by that date.