New trade deal could eliminate tariffs on 99.8% of Swiss exports to China

Switzerland and China have concluded negotiations on an updated free trade agreement (FTA) that is expected to expand Swiss access to its third-largest trading partner.

Swiss President Guy Parmelin and Chinese Commerce Minister Wang Wentao announced the conclusion of the talks following a meeting in Bern on August 20, as the Alpine country's government officially noted.

According to business community platforms for entrepreneurs conducting deals in Switzerland, the revised agreement is intended to address an existing imbalance in market access. Chinese goods already enjoy almost duty-free access to Switzerland, while only around half of Swiss exports to China currently receive duty-free treatment.

Under the updated FTA, customs duties could eventually be eliminated on 99.8% of Swiss goods exports to China. Around 77.5% of exports would receive duty-free access when the agreement enters into force, while tariff reductions for other products would be phased in over periods ranging from five to a maximum of 10 years.

The additional potential for customs savings is estimated at around CHF 244 million (approx. $304 million).

Particularly Swiss companies in the watchmaking, machinery, pharmaceutical and chemical industries are expected to benefit significantly from the revised agreement. For watches and pharmaceuticals, as well as machinery and chemical products, the agreement aims to provide full duty-free market access once the agreed transitional periods have expired.

Improvements have also been agreed for selected agricultural products, including cheese, roasted coffee and coffee-based preparations.

The agreement will also introduce modernised rules of origin that could make it easier for Swiss companies to qualify for preferential treatment.

Under certain conditions, processing operations will in future be permitted in a third country. Preferential treatment will also no longer necessarily require goods to be transported directly between Switzerland and China.

The agreement will establish conditions for the use of electronic certificates of origin and explicitly provide for data exchanges between the two countries’ customs authorities.

Digital trade and investment

The updated agreement also includes new or expanded provisions covering trade facilitation, services, investment, digital trade, competition, environmental standards and labour standards.

Clearer rules for digital business models are intended to provide greater legal certainty while facilitating the use of electronic documents and digital processes.

The agreement could therefore deepen economic ties between Switzerland and China beyond the reduction of tariffs, particularly in services, investment and digital commerce.

Although negotiations have been concluded, the revised FTA has not yet entered into force. The agreement’s texts are currently undergoing legal finalisation, with signing expected to take place during 2026. The deal will then have to go through domestic approval procedures in both Switzerland and China. Until the updated agreement enters into force, the existing provisions of the Switzerland-China FTA will remain in effect.

By Nazrin Sadigova