Sat, Jan 20th 2024
The new EFTA Free Trade Agreement Set to See Swiss Exports Soar as New the Deal Eliminates Nearly All Customs Duties.
In a landmark development, Switzerland, along with its EFTA free trade partners Iceland, Liechtenstein, and Norway, has successfully revamped its free trade agreement with Chile, achieved in Santiago de Chile last Friday. This pivotal upgrade signifies a major shift: the majority of Swiss exports to Chile will now enjoy the benefit of being duty-free. This deal has been secured despite the outgoing secretary general of EFTA’s concerns about the future of the arrangement.
The original EFTA free trade agreement with Chile, dating back to 2004, had certain limitations in comparison to Switzerland’s more recent trade deals. However, according to the State Secretariat for Economic Affairs (SECO), these gaps have been bridged in the latest iteration, finalised after negotiations that have been underway since 2019.
This revised agreement is a game-changer. It expands market access significantly and fortifies the legal framework for businesses. Guy Parmelin, the Economics Minister, shared his enthusiasm over this achievement on the messaging service X, highlighting the increased predictability it brings for businesses.
SECO has confirmed that with the modernized agreement, an astounding 99.99% of Swiss exports to Chile will be exempt from customs duties. The agreement now includes provisions on sustainable trade and development, financial services, support for SMEs, and e-commerce. It also ensures the protection of key Swiss geographical indications and encompasses comprehensive intellectual property rights and their enforcement.
Chile stands as a crucial trade ally for Switzerland in Latin America. Since the implementation of the original free trade agreement, bilateral trade in goods has seen consistent growth, reaching CHF 1.2 billion in 2022. The trade in services has also seen an upswing, amounting to approximately CHF 500 million in 2022.
The Swiss private sector’s footprint in Chile has been expanding, with significant investment and employment opportunities, currently supporting around 18,000 jobs in various sectors.
The finalization of the agreement’s texts is expected in the upcoming weeks, with the official signing ceremony scheduled for June at the EFTA Ministerial Conference in Geneva, featuring Federal Councillor Guy Parmelin.
In addition to this, during the World Economic Forum (WEF) in Davos GR, Parmelin announced plans to finalise a long-awaited free trade agreement between EFTA free trade states and the South American trading bloc Mercosur within the year.
©Keystone/SDA
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