Switzerland’s Free Trade Agreements

Switzerland has 33 Free Trade Agreements (FTAs) with 43 partners around the world. The UK and Switzerland are negotiating an enhanced FTA which is expected to be agreed in 2024.

Switzerland’s FTAs include agreements with the European Union (EU), Gulf Cooperation Council (GCC), China, India, Mercosur, Japan, Canada and Mexico. Switzerland are also part of the EFTA.

EFTA

Switzerland is part of the European Free Trade Association (EFTA). EFTA consists of Norway, Iceland, Liechtenstein and Switzerland. This intergovernmental organisation promotes free trade and economic integration. EFTA negotiates joint FTAs with other countries and often recognises dimensions of sustainable development within the agreements, covering the protection of environment, labour and gender rights.

EFTA currently has 31 FTAs covering 42 countries and territories outside the EU. EFTA is not a customs union: countries can set customs tariffs independently and enter into bilateral third-country trade arrangements. All four member states participate in the European Single Market and are part of the Schengen Area.

European Union

Switzerland does not have a comprehensive agreement with the EU; rather it has a series of smaller agreements that have been built up over the years.

The EU is Switzerland’s biggest trading partner. The relationship is governed by bilateral agreements where Switzerland has agreed to take on aspects of EU legislation in exchange for accessing part of the EU’s single market.

The agreements help to reduce costs of trade as well as Technical Barriers to Trade (TBT). A customs simplification and security agreement allows trade without additional customs security measures, and the agreement to simplify TBT administrative procedures is based on equivalent regulations and mutual recognition.

China

Switzerland and China signed a bilateral FTA in 2014. The trade agreement improves access to markets for goods and services as well as improving legal certainty around economic exchanges and intellectual property. China is currently the third-largest export market for Swiss animal products, after the EU and USA. For the majority of trade, tariffs have been reduced or removed over the last ten years.

Switzerland’s top agrifood export to China, in value terms, is dairy, specifically milk powders (£16m 2020–2022 average) and cheeses (£3m 2020–2022 average). Most dairy tariffs have now been removed, apart from yoghurt which will fall to 0% in 2026.

There is also demand for pork, valued at almost £2.5m (2020–2022 average).

USA

The USA is Switzerland’s second-largest trading partner after the EU. The USA and Switzerland have a number of bilateral agreements, although not a formal FTA.

A strategic partnership between the two countries formalises the partnership at political levels. It covers a range of issues including trade, tax, research and finance. Switzerland’s top agricultural exports to the USA are dairy products, specifically cheese (£85m 2020–2022 average).

UK

The UK and Switzerland have a bilateral FTA. This is being renegotiated to enhance the agreement and is expected to conclude later in 2024.

Following the EU Exit, the UK and Switzerland negotiated a bilateral FTA as a continuation of the EU FTA. In these negotiations it was agreed that there would be further discussions on an enhanced trade deal in the future. Discussions started in 2023 and are expected to complete in 2024. The negotiations will strengthen the trading relationship and provide further opportunities for trade of services and goods.

The current agreement fully liberalises 79% of import tariffs into Switzerland, and the new FTA will aim to reduce tariffs and quotas on agricultural goods where tariffs remain high. There will also be discussions to simplify bureaucracy, digitalise custom procedures and make it easier for businesses to trade with Switzerland.

Tariffs

Switzerland tends to have specific tariffs rather than ad valorem rates: they vary according to the goods imported. The Most Favourable Nation (MFN) tariffs tend to be quite high for agricultural goods: 137.7% for dairy products compared to 30.4% for all other goods.

Tariffs are high for goods that can be produced in Switzerland to protect domestic industry. But for goods not produced in-country, such as tea and coffee or fish products, tariffs are very low.

Continue reading about the UK–Switzerland FTA

• Introduction
• Trade between the UK and Switzerland at a glance
• Switzerland trade and production
  • Beef
  • Lamb
  • Pork
  • Dairy
• Consumer demand: Is there a market to export more UK red meat and dairy to Switzerland? 
• Agricultural policy in Switzerland
• Economic modelling of the beef, sheep, dairy and pork sectors (coming soon)