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Sino Swiss Free Trade Agreement

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Swiss tariff reductions under the CSFTA also cover a wide range of products. Among the goods on which Chinese exporters can make great savings are magnets, water heaters, vacuum cleaners, bicycles and electric motors. The Swiss watch industry has access to duty-free intermediate parts from China. Nevertheless, Switzerland has continued to protect its agricultural and agricultural sector, which includes products such as milk and cheese, sugary products, fruits, cereals, specific animal products and certain varieties of wines. The Free Trade Agreement (FTA) signed in 2013 between Switzerland and China is one of the most ambitious trade agreements signed to date by the two countries. During President Xi Jinping`s state visit to Switzerland in 2017, the two governments agreed to value the free trade agreement. Switzerland`s exports to China are dominated by jewellery, which accounted for 60% of the total in 2018 and is highly volatile. Swiss jewellery exports to China increased between 2010 and 2013, with an average annual rate of 221 per cent, and slowed considerably between 2014 and 2019 to 2.7 per cent per year. The slowdown occurred despite tariff reductions for gold and jewellery products under the CSFTA and the total elimination of tariffs on many of these items. A severe crackdown on corruption in China could be responsible for these trends, as gifts of Swiss jewellery and watches are believed to be a common form of corruption in China. The decline in these exports from Switzerland to China is mainly due to slowing exports and volatility. On the other hand, drug exports, which accounted for 20% of Swiss exports to China in 2019, have grown at an annual rate of 16.4% since the free trade agreement came into force (2014-19).

In this context, EU jewellery exports grew faster after the Sino-Swiss agreement than before the agreement, which could support the fight against corruption in Switzerland. However, EU pharmaceutical exports slowed sharply after the CSFTA, indicating that there may have been some reorientation of trade. China`s concessions in the services sector under the CSFTA were even more limited than in merchandise trade.