TWN Info Service on WTO and Trade Issues (Nov26/04)
6 November 2026
Third World Network

Trade: Switzerland seeks to bridge divides amid growing trade fragmentation
Published in SUNS #10549 dated 5 November 2026

Geneva, 4 Nov (D. Ravi Kanth) -- "While some prefer to erect new walls," Switzerland wants "to build bridges between countries, markets and people," said its President, Guy Parmelin, amid mounting headwinds in the global trading system, which is rapidly fragmenting due to the rise of unilateral actions.

Speaking to foreign correspondents in Bern, the Swiss capital, on 2 November, the Swiss President said that his country wants "to maintain dialogue despite political differences."

Insisting that his administration is "not naive," Mr Parmelin asserted that Bern is "aware of the risks and the different interests, and we will defend the values of international law."

Emphasizing Switzerland's neutralist stance, the President maintained that "we are convinced that cooperation is better than confrontation, and common rules are better than the law of the jungle."

"This is why we remain committed to open, fair and rules-based global trade," he said.

Switzerland appears to be in a hurry to conclude free trade agreements (FTAs) while pursuing several new trade and investment initiatives outside the World Trade Organization (WTO).

However, Mr Parmelin said that Bern remains committed to the WTO, notwithstanding the headwinds it currently faces.

Against this backdrop, the SUNS asked the Swiss President how Switzerland intends to reconcile its position with German Chancellor Friedrich Merz's calls for large-scale free trade agreements with the Pacific region, on the one hand, and US President Donald Trump's pursuit of "fair and reciprocal" trade policies, on the other.

Mr Parmelin said that "it is absolutely necessary that the WTO rules must be respected."

In the same breath, he said that "we regret that it is not the case actually," implying that countries are failing to implement the rules.

"That's why we try to find special rules, which can be respected by small and medium countries," the President said.

The Swiss presidency operates on a rotating basis, with the Federal Council, Switzerland's executive body, rotating the presidency annually among its members.

The arrangement is intended to prevent any single individual from wielding excessive power or influence, thereby promoting stability and balance within the government.

Mr Parmelin, who also heads the trade and economy ministry, is expected to complete his term by the end of this year.

Recently, he met with several heads of state to pursue free trade agreements, including President Trump, with a view to concluding a joint agreement with the US.

FIT PARTNERSHIP

Switzerland, Mr Parmelin said at the press conference, is also engaged with a group of middle-income countries in an investment initiative called the "Future of Investment and Trade-Partnership" (FIT-P).

The initiative aims to develop "concrete solutions to current and future challenges in trade and investment," through a work programme focusing on four areas: supply chain resilience, digital trade, new trade technologies, and strengthening the rules-based trading system, a senior advisor to President Parmelin said.

The FIT-P comprises Switzerland, Brunei, Chile, Costa Rica, Fiji, Iceland, Liechtenstein, Malaysia, Morocco, New Zealand, Norway, Panama, Paraguay, Peru, the Republic of Korea, Rwanda, Singapore, the United Arab Emirates, Thailand and Uruguay.

Switzerland also coordinates the "Friends of the System" group at the WTO, which appears to be pursuing a controversial WTO reform agenda, which, on the face of it, appears to be going nowhere at this juncture.

Asked about the group's role in the WTO reform discussions, Mr Parmelin said that the WTO rules are strong, although the Appellate Body remains dysfunctional.

He cited the trade dispute that Switzerland launched against the United States in 2018 over Section 232 tariffs on steel and aluminum.

In that dispute, the panel sided with Bern, finding that Washington had violated several WTO provisions.

Mr Parmelin said the United States chose to appeal the panel ruling, effectively "voiding" the findings because of the dysfunctional Appellate Body.

"We can't have the second step if you win against the US," he said, indicating that the Appellate Body remains paralysed.

"I think it's not good for all the world, for the US, for the European Union, for all other countries, and it's why small and medium-sized [countries] try to respect the rules-based system of the WTO," he said.

The Swiss President said some 85-86 percent of international trade is still conducted under WTO rules. However, "it is not a good solution," he said.

FTAs

Mr Parmelin referred to the recent enhanced Swiss free trade agreement with China, including his meeting with Chinese President Xi Jinping.

In the presence of President Xi and President Parmelin, the new Protocol Enhancing the Free Trade Agreement was signed on 30 October by China's commerce minister Wang Wentao and Swiss State Secretary and Director of the State Secretariat for Economic Affairs Helene Budliger Artieda.

A press release issued by China states that China and Switzerland "will make joint commitments to high-standard opening up in goods, services and investment and further upgrade rules in relevant fields, such as rules of origin, trade facilitation, technical barriers to trade, digital trade, competition, and trade and sustainable development, on the basis of the original FTA."

Further,  the two countries said that "the enhancement of China-Switzerland FTA will further deepen bilateral economic and trade cooperation, and provide stronger institutional guarantees for the liberalization and facilitation of bilateral trade and investment, demonstrating the two sides' clear position in support of free trade, open cooperation and the rules-based multilateral trading system amid current uncertain international environment."

According to the press release, the original China-Switzerland FTA came into force in July 2014.

The two sides launched the FTA enhancement negotiations in  2024 and announced its conclusion in August 2026 after five rounds of negotiations.

Following the signing of the enhancement Protocol, the two sides "will complete their respective domestic legal ratification procedures and jointly promote its early entry into force, so as to benefit the enterprises and people of the two countries as early as possible."

A Swiss official working with President Parmelin told the SUNS that the enhanced free trade agreement with China will cover 99.5 percent of bilateral trade between the two countries.

Switzerland has already abolished tariffs on all industrial products, with some safeguards on agricultural products, the Swiss official said. +