Under Trump, protectionism is likely to intensify – Switzerland needs a strong foreign trade network more than ever.
The US presidential elections always attract a lot of attention, the media coverage is enormous. This is not surprising because, unlike elections in other countries, they raise important questions not only in terms of American domestic politics, but also on a global level. This applies to the whole world, but particularly to Switzerland, a small open economy.
The export-oriented industries of chemicals, pharmaceuticals and life sciences are particularly targeted as growth engines of the Swiss economy. Indeed, in 2024, they will once again contribute to around half of Switzerland’s total exports and have experienced very satisfactory developments despite a difficult context. More than 90% of chemicals and pharmaceuticals manufactured in Switzerland are destined for export, which explains why the industry is so dependent on international trade links.
The United States, by far the largest pharmaceutical market in the world
The United States is – after the EU – one of the main outlets for members of scienceindustries and plays a key role in world trade. The United States is the largest pharmaceutical market in the world. But the election result raises fears that the protectionist trade policies of recent years will continue under new President-elect Donald Trump – which could make market conditions much more difficult for Swiss companies.
Desire to open markets
During the election campaign, the new US President Trump made virulent remarks, saying he wanted to introduce generalized tariffs and impose 60% tariffs on exposed countries like China. It is unlikely that trading partners will relent and take retaliatory measures, with the risk of a vicious protectionist cycle.
This would go directly against the interests of our industries, which depend on as free access as possible to global markets. The World Trade Organization (WTO) plays a vital role in this regard. Ideally, the United States should express its concerns, particularly regarding China, and commit to an international level playing field.
Intensify bilateral relations
Despite these challenges, there are positive examples of cooperation between Switzerland and the United States. The signing of the Mutual Recognition Agreement for Inspection Results (MRA/Mutual Recognition Agreement) in the field of Good Manufacturing Practices for Medicines (GMP/Good Manufacturing Practices) was successfully completed last year. The MRA GMP facilitates access to the medicines market and strengthens economic relations between the two countries. We must continue to build on this good economic cooperation.
Deepening such cooperations may have great potential, particularly for the chemical, pharmaceutical and life sciences industries. It remains to be hoped that the future American administration will recognize the value of such partnership approaches and will be open to their development. Cooperation will not only strengthen bilateral relations, but will also sustainably promote the innovation capacity of both countries.
