Switzerland, China Sign Trade Deal

Switzerland and China have inked their free trade agreement, officials from both countries announced this past weekend. The two trading powers finalised the technical details of the agreement in May, after three years of negotiations. The deal marks the second agreement between China and a European country, with the first being Iceland earlier this year.

The pact is expected to enter into force in 2014, following ratification. Bern has also signed a parallel agreement on labour and employment with Beijing.

The deal with the world’s second-largest economy is expected to boost the Swiss economy, which has felt the impact of the economic struggles of the neighbouring European Union. The agreement seeks to increase economic exchange and facilitate industrial cooperation between the countries, and includes provisions related to the environment, intellectual property, and government procurement.

The deal is also set to cut duties on Swiss products, such as pharmaceuticals and machine tools, and decrease the tariffs on watches exported to China by 60 percent over the next ten years. China is seeking to increase the sale of textiles in Switzerland, and therefore these products will be given zero-tariff access to the Swiss market.

China is currently Switzerland’s largest Asian trading partner, with imports from China valuing CHF 10.29 billion, and Swiss exports to China valued at CHF 7.83 billion in 2012.