Business Daily: "Small country: Big tariffs"

Podcast: Business Daily
Host: Imogen Foulkes, BBC World Service
Date: October 8, 2025

Episode Overview

This episode explores the economic shockwaves sent through Switzerland after the US, under President Trump, imposed a massive 39% trade tariff on Swiss goods—making Switzerland the most taxed developed economy by the US. Through on-the-ground reporting, expert commentary, and candid interviews with Swiss industry leaders, the program examines why these tariffs were imposed, who they hurt, and how both Swiss and American economies stand to lose. The host, Imogen Foulkes, delves especially into Switzerland’s critical medtech sector, the intricate roots of its manufacturing success, and how this new reality is forcing a small, export-driven nation to rapidly shift its global strategy.

Key Discussion Points & Insights

1. The Tariff Bombshell

• [01:09–01:54] On Swiss National Day, while families celebrated, news broke that the US would hike tariffs on Swiss goods to 39%.

• Immediate Reactions:

  • “I was actually on a plane to the US when I first read about it and I simply could not believe what I was seeing.” – Adrian Hun, [01:54]
  • “39% tariffs. This is unjustified. You can't explain why it is so high.” – Jan Atislander, [02:16]

• Trade imbalance cited: President Trump reportedly found Switzerland’s $41 billion trade surplus with the US “intolerable” and pressed for even higher tariffs when initial negotiations failed.

  • “Instead of the original threat of 31% tariffs… he raised them to 39%.” – Imogen, [03:08]

2. Economic Impact on Switzerland and the US

• [03:38–05:10] Switzerland is a top-ranked competitive economy; 17% of its exports go to the US.

  • “We are the biggest foreign investor in the United States. We employ hundred thousands of U.S. citizens and we pay the best salaries.” – Jan Atislander, [04:21]

• Tariffs are ‘unjustifiable’:

  • “We are not dumpers. We do not manipulate our currency… We have no export subsidies.” – Jan Atislander, [04:56]

• Paradox: The controversial trade surplus is mainly due to gold exports, which are exempt from the tariffs—while pharmaceuticals face even bigger threats.

3. Swiss Medtech: Precision at Risk

• [05:52–08:34] Spotlight on Switzerland’s medical technology (medtech) sector, the third largest contributor to its trade surplus—beyond even cheese and chocolate.

  • “First of all, is pharma. Second… watches. But then… comes MedTech.” – Adrian Hun, [05:52]

• High-stakes manufacturing:

  • Swiss medtech exports include life-saving and life-enhancing devices “from knee implants, pacemakers, dental implants, surgical instruments… and much more.” – Adrian Hun, [06:24]
  • Many of these devices stem from the country’s legacy of precision watchmaking, combined with top-tier medical training.

• Ecosystem, not assembly line:

  • “Here we do everything ourselves almost. We make high precision systems, medical devices... very specific gears for drug delivery systems.” – Gilles Robert, [07:24]
  • “This is the engine of the currently only medically registered artificial hearts in the world… it will pulse in both sides… allow people… to keep on living.” – Gilles Robert, [08:08]

4. Why Moving Manufacturing Isn’t Simple

• [10:26–11:45] Trump’s promise (“make these things in the US”) meets a harsh technical reality.

  • Medtech isn’t car-making: “Every part is matched to the other. If you don't have a manufacturing environment where you control every element, it won’t work.” – Gilles Robert, [11:03]

• Swiss vocational training critical:

  • “The apprenticeship… where you put teenagers in front of machines… then over the years get them to really understand… what it means to mill or to turn or to assemble. I think those types of skills would be extremely hard to find in the US.” – Gilles Robert, [12:40]

5. The Painful Ripple Effects of Tariffs

• [13:16–15:39] With little wiggle room, Swiss exporters can’t absorb the extra cost: “The margins are already as low as they can be.” – Gilles Robert, [13:26]

• US hospitals and patients may ultimately pay, or lose access to critical devices:

  • “Some decisions might be made that certain products are… too expensive and will hence be discontinued… American patients might lose access.” – Gilles Robert, [13:51]

• “Medical device will get more expensive for US patients… This means taxpayers bear the burdens.” – Adrian Hun, [14:52]

• The sector association calls this a “horror scenario”.

• Rapid fallout: Swiss exports to the US “have already dropped off dramatically.” – Imogen, [15:39]

6. Searching for Solutions: Diversification and Resilience

• [16:11–17:09] Switzerland leans into diversification—recent free trade agreements with India, China, and Mercosur.
  • “This strategy as an export nation has no alternative... Resilience is one one of the things you really have in your DNA.” – Jan Atislander, [16:11]

7. Who Really Loses? Both Sides.

• “We are a fair partner for the United States. There are not that many products where you have a NET margin of 39%. I'm sorry. And there are companies that have very good products. They communicated. We just stopped delivering. Sorry, guys.” – Jan Atislander, [17:13]

• US rhetoric: “Tariffs are about making America rich again and making America great again. And it's happening and it will happen rather quickly.” – Ryan, [17:32]

• But shortages will hit American hospitals and patients first—and for Switzerland, finding new markets is a matter of survival, but the “hurt remains.”

  • “The Swiss loved doing business there. Their economy has always been less regulated than the EU’s. Closer… to the US model. Now both Adrian Hunter and Gilles Robert have had to abandon that notion.” – Imogen, [17:39]

Notable Quotes & Memorable Moments

• “I simply could not believe what I was seeing.” – Adrian Hun ([01:54])
• “39% tariffs. This is unjustified.” – Jan Atislander ([02:16])
• “We are like a best case example how you can have a very good partner.” – Jan Atislander ([04:21])
• “It’s not only what we have in our factory that's important. The people, the skills that are built... these are all contributing to reaching those almost impossible things. And you cannot just move that around.” – Gilles Robert ([11:45])
• “I can say quietly, they had the best price before the new tariffs came into effect... the margins are already as low as they can be.” – Gilles Robert ([13:26])
• “Medical device will get more expensive for US patients... taxpayers bear the burdens.” – Adrian Hun ([14:52])
• “Resilience is one of the things you really have in your DNA. Otherwise you will not get very far.” – Jan Atislander ([16:11])
• “There are companies that have very good products. They communicated. We just stopped delivering. Sorry, guys.” – Jan Atislander ([17:13])
• “Even though I’m a bit sad of this situation, will overcome and yeah, we’ll find solutions and I’m sure in the end reason will prevail.” – Gilles Robert ([18:51])

Timestamps for Important Segments

| Timestamp | Segment / Topic | |-----------|----------------| | 01:09 | Introduction: Tariff shock on Swiss National Day | | 01:54 | Business leaders react: disbelief, anger | | 03:08 | Trade deficit rationale and failed negotiations | | 04:21 | Swiss role in the US economy (investment, jobs) | | 05:52 | Medtech: third largest Swiss export surplus | | 07:24 | The medtech ecosystem and roots in watchmaking | | 08:08 | Swiss innovation: the artificial heart | | 11:03 | Why precision manufacturing can’t simply be relocated | | 12:40 | Swiss vocational education: the skills gap | | 13:26 | Can companies absorb the tariffs? Implications for buyers | | 14:52 | Impact on US patients, hospitals, and taxpayers | | 16:11 | Switzerland’s strategy: diversification for resilience | | 17:13 | Who loses? Both the US and Switzerland | | 18:25 | The personal and economic hurt; hope for future solutions |

Tone & Final Reflections

Consistent with the BBC’s measured yet urgent style, the episode voices real concern from industry insiders, highlights detailed technical realities, and portrays both economic pain and Swiss resilience. While the tone is at times incredulous—“You can’t explain why it is so high”—it is also pragmatic, focused on seeking new opportunities and preserving optimism about future US-Swiss relations.

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