The Swiss Trade Monitor documents time trends in Switzerland's foreign goods trade. The third edition focuses on Switzerland's trade relationship with Indonesia. In November 2021, a free trade agreement (FTA) between the two nations came into effect. We provide a preliminary empirical account of the FTA. Preferential FTA tariff rates were only applied to about 11% of Swiss imports from Indonesia in 2022. This is, to a large extent, because FTAs are generally less used for the products which account for the lion's share of Swiss imports from Indonesia. There is, thus far, little evidence to suggest that the FTA has caused the bilateral trade volume to increase substantially. It is crucial to obtain detailed customs data from FTA partners in order to monitor and manage the success of trade agreements. The topic of palm oil imports from Indonesia played a key role in the campaigns for the Swiss referendum on the FTA. This contrasts with reality: barely any palm oil is imported from Indonesia and only a fraction of it has benefited from preferential FTA tariffs.

Stefan Legge, Ronny Oberholzer, Jason Rosenthal

21 Feb 2023