Switzerland is offering to invest in U.S. gold-refining operations

Switzerland is offering to pour money into U.S. gold-refining plants in a push to get President Donald Trump to drop the 39% import tax slammed on its goods last month, according to reporting from Bloomberg.

That tax, the steepest seen in any developed country, is already cutting into Swiss export numbers and dragging growth predictions down. After an earlier attempt by Swiss President Karin Keller-Sutter to push back on Trump blew up in her face, officials are now switching tactics. They’re dangling sweeteners across energy, farming, and now gold.

The offer made to Treasury Secretary Scott Bessent and Trade Representative Jamieson Greer includes sending Switzerland’s lowest-profit refining work to U.S. soil. That means moving the job of melting down large London gold bars and turning them into smaller ones preferred in New York—work that earns refiners just a few bucks per bar even when prices top $3,800 an ounce. The Swiss government didn’t want to talk specifics, but said it had “optimized its offer to the U.S. in order to reach a swift agreement.” It added that talks would continue with the goal of slashing the new tariffs as quickly as possible.

Swiss bullion exports flood U.S., trigger political backlash

This all kicked off when Trump’s tariff threat created a window for gold traders. They moved quickly to dump gold into America before any official action landed. That short-term play turned into a problem when bullion made up more than two-thirds of Switzerland’s trade surplus with the U.S. in the first quarter alone. The canton of Ticino, home to the world’s biggest gold refineries, became the center of it all. With Swiss refineries running nonstop to melt and recast bars, a surplus exploded. That imbalance brought backlash from across the Swiss political map.

Nick Hayek, CEO of Swatch Group, and Lisa Mazzone, President of the Green Party, both called for a tax on gold exports. Hayek even said Switzerland should slap a 39% tax on gold bars headed to the U.S. to mirror what Trump had done. That came after Trump said U.S. gold imports were safe from his tariffs—further stirring the pot. Mazzone argued that gold refining carries serious reputational risks for the country and doesn’t give back enough economically. “The industry carries a reputational risk but doesn’t bring a large net benefit to the economy,” she said. “If this sector costs so much to Switzerland, particularly right now because of the tariff dispute, then it should contribute more.”

Mazzone’s concerns trace back decades. During World War II, Swiss banks took in looted Nazi gold. In 1968, three of those banks built the Zurich Gold Pool, launching Switzerland into bullion dominance by refining massive amounts of gold, including from apartheid-era South Africa. Professor Mark Pieth, who wrote the book Gold Laundering, has detailed this murky past. Ownership in the industry has changed since then, but the thin profits haven’t. Even now, refiners only pull a couple dollars per bar despite record gold prices.

Refiners push back as industry questions U.S. expansion

Refiners aren’t exactly rushing to set up shop in the U.S. Christoph Wild, president of the Swiss Association of Precious Metals Producers and Traders, said the current system—where gold from the U.K. flows through Switzerland before hitting U.S. markets—is inefficient. He said that could be fixed by building up refining capacity in the U.S., though that only makes sense if there’s enough local demand. “All our refinery members have mid-term to long-term plans to further invest in the U.S.,” Wild said. But he added he didn’t know “if it’s possible to run that business in an economical way without having some subsidies from the Swiss government or the U.S. government.”

Someone close to the talks confirmed that at least one Swiss refiner is already looking to speed up investment in the U.S. Meanwhile, others are warning that forcing this industry to pay taxes or relocate could destroy it. Wild said, “Nobody would pay a premium of even 1% for gold when you could buy it at the market price.” A levy would wipe out profits and kill the trade overnight.

For Simone Knobloch, Chief Operating Officer at Valcambi SA, the numbers don’t add up. The company, which refines up to 2,000 tons of metals annually in Balerna, right next to Italy, has no footprint in the U.S. and no plans to build one. “If I look at the business case, it doesn’t make sense,” Knobloch said. The U.S. market is already crowded, and the margins are too low to justify expansion. Still, with Trump sitting in the White House again and pressure rising on Swiss politicians, the gold industry might not get to choose what makes sense anymore.

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