Trade with Switzerland – NFU welcomes launch of trade talks

NFU Vice President David Exwood said: “We are pushing our own government to focus its trade efforts on opening up markets where there's a genuine opportunity for UK agriculture to grow sales of fantastic British products overseas. Switzerland is an excellent partner for further developing trading links and selling high value British products to the mutual benefit of both countries.

“I know, following my recent visit to Switzerland, that British and Swiss farmers hold many shared values, including sustainable food production, protection of animal welfare and environmental standards, reduction of anti-microbial resistance, and the importance of food security.”

“We are proud to uphold those values and ensure that consumers in our respective countries can continue to benefit from a safe and stable supply of high quality, affordable food produced to world leading standards.

“We hope the UK and Swiss governments are able to secure an ambitious trade deal; one that delivers genuine opportunities benefiting farmers and consumers in both countries in the form of increased trade, complementing domestic supply in our respective markets that sets a new global benchmark for trade deals which meaningfully upholds our shared values.”

We submitted our response to the consultation on 20 June 2022.

Our response urges the government to negotiate a balanced and mutually beneficial enhanced trade agreement with Switzerland.

We believe that increased bilateral trade can complement domestic supply in our respective markets and propose that all remaining tariffs should be fully liberalised by both parties within reasonable timeframes.

Read: Member briefing – NFU position for a prospective trade deal with Switzerland

Demand for British

Switzerland has a population of 8.5 million, with a GDP per capita of $86,850 (USD) compared to the UK GDP per capita of $41,059.¹

It has the highest food prices in Europe with consumers willing to pay for high quality products.

Demand for meat, dairy and organic food is high, with much potential to send high value British products to benefit both counties.

Swiss consumers prefer high value products and provenance is important.

The NFU believe that ensuring protection for iconic UK GI products, must be a priority for negotiators.

Current tariffs

The current UK-Switzerland Trade Agreement liberalises 79% of Switzerland’s tariff lines on imports from the UK. The remaining 21% of tariffs relate to agricultural products.

These tariff lines are either subject to a Tariff Rate Quota (TRQ), a partial tariff reduction, or are excluded from any tariff reduction altogether.²

Beef and lamb

Switzerland is a highly protected market, with very high tariffs on meat products. The tariff on striploin cuts is £10,944/t.

Despite this, we did manage to export over £5million worth of beef per annum during the period 2018-2021.

The opportunity to grow this further is currently limited by volume limited Swiss quotas.

It is a similar situation in the lamb and mutton sector. We exported more than £4million worth of sheepmeat during the 2018-2021 period, placing exports of fresh or chilled cuts of lamb in the top 25 products we export to Switzerland.

The in-quota duty for lamb across all fresh carcasses and cuts is £240/t (CHF300), whilst out of quota the rates are prohibitively high at over £6000/t.

The NFU believe negotiators should seek to remove all quotas and tarriffs across the beef and lamb sectors.

The NFU believe there is high potential to increase UK lamb and sheep meat exports with particular interest from Swiss buyers for high-quality, grass-fed lamb.

Dairy

Our cheese exports averaged over £3.7m p.a in the period 2018-2021.

The UK maintained its 0% duty TRQs for exported cheeses including cheddar, processed cheese, and other cheeses not elsewhere specified.

This is an excellent example of where tariff removal demonstrates that trade in complimentary products to domestic production can deliver benefits for both Swiss consumers and UK agri-food suppliers.

Horticulture

Exports of fruit, vegetables and nuts averaged £636,000 p.a. between 2018 and 2021.

There are 166,076t and 4,500t erga omnes (rest of world) quotas in place for fresh and frozen vegetables.

Tariffs within these quotas vary by product, with peas and sweetcorn £80/t, for carrots £32/t.

Efforts should be made to remove tariffs where UK production can complement domestic production across the horticulture sector.

^{1 data.worldbank.org
2 GOV.UK | Information note for the call for input on an enhanced free trade agreement between the United Kingdom and Switzerland}

This consultation closed on 22 June 2022.

The government has opened a consultation on current trading arrangements with Switzerland.

Read: GOV.UK | Trade with Switzerland: call for input

In 2021 we exported £175m worth of agri-food products, including more than £4.6million worth of cheddar cheese to Switzerland.

Our top exports include Scotch Whisky (£22m), breakfast cereals (£5.3m) and in 2019 we exported £6.6m worth of beef to Switzerland.

In February 2019, the UK and Switzerland signed the UK-Switzerland TA (Trade Agreement) which provides the basis for our trading relationship with Switzerland and is a platform from which we can begin the process of negotiating a new and more ambitious trade deal.

The TA replicates the complex set of agreements which governed the existing trade relationship between the European Union and Switzerland.

Switzerland maintains significant tariffs on imports of agri-food to its country.

Building on the existing agreements and securing enhanced preferential access for UK products to the Swiss market would definitely be an opportunity for our exporters.

Have your say

The NFU will respond to the consultation, so if you have any views on trade with Switzerland you would like to share please drop [email protected] email by 13 June.