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Swiss Immigration Fears Risk Crashing EU Talks Once Again

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(Bloomberg) — Switzerland is about to make another push to improve its fractured relationship with the European Union, and the plan is under pressure before it’s even begun.

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The government hadn’t even announced it wanted to restart formal talks with its biggest trading partner when the backlash started. Unions voiced concern about workers’ standards, and the right-wing SVP, the biggest party in parliament, re-upped its anger over high immigration and leveled accusations that the government was selling out the country.

The talks aim to repackage what’s currently a vast array of bilateral agreements — covering everything from access to the bloc’s single market to freedom of movement and financial regulation — into a more streamlined deal.

Switzerland walked away from a potential accord two years ago, shaking crucial political and economic ties and frustrating the bloc. It was a bold step by the Swiss given that the EU buys half its exports and goods trade amounts to more than 300 billion euros ($325 billion) a year.

While the current agreements broadly work, the EU remains unhappy with the hodgepodge approach. And this time, the Swiss may not have the luxury of such a dramatic move.

In an increasingly fractured and tense geopolitical world, where national interests dominate, Switzerland needs to show some goodwill. The risk otherwise is that it becomes increasingly shut out by its larger neighbor and can’t rely on the EU in times of trouble.

The tensions are already having a real-world fallout. They’ve affected the stock exchange and Swiss shares, which are banned from being traded in the EU since 2019. Power companies say they threaten energy security, and Switzerland’s scientists can’t access research funding in the EU’s Horizon program.

“Muddling through has somehow worked over the last years,” said Georg Lutz, a professor of political science at the University of Lausanne. “But Switzerland is getting more and more isolated in Europe, and if there is a crisis, like the energy crisis last winter, Switzerland can’t count on the EU’s solidarity.”

The controversy surrounding Switzerland’s EU relationship echoes the Brexit debate that’s dominated UK politics for years. It features emotive language as well as dire warnings that a new deal will lead to unchecked immigration and turn Switzerland into an EU vassal state. Such concerns have also played out in various forms across Europe, most recently in the victory of Geert Wilders in Dutch elections.

The government is “prepared to surrender Switzerland’s sovereignty and enslave our country to the EU,” the SVP said in November, adding it “will fight this with all means.”

Read more: Europe’s Migration Disputes Threaten to Derail Its Ambitions

Switzerland closed a deal with the EU in 1999 enabling free movement of people, without which Swiss businesses couldn’t get enough workers.

But concern about too many foreigners ranked among the top issues before elections that took place in October. That vote saw the SVP secure its third-best result in history.

It’s a complicated mix, and makes things difficult for the government, as it will have to sell any new deal at home, likely in a national vote under the country’s direct democracy system.

In the alpine resort town of Grindelwald, known for the famous Lauberhorn ski World Cup run below the mountain trinity of Eiger, Moench and Jungfrau, this clash of ideas can be witnessed in action.

The Swiss alps is where the SVP has its traditional strongholds, and more than 60% of voters in Grindelwald backed the party in October. That was one of its strongest results, despite the fact that the region’s hotels, restaurants and bars rely on immigration.

“Nobody has anything against workers coming to Switzerland,” said Stefan Grossniklaus, head of Grindelwald’s hotel association and former local SVP chief. “But the coming of asylum seekers from Africa and the Middle East is a problem. We need to regulate.”

That view is captured graphically on the SVP’s website, which features pictures of bloody knives alongside calls to combat immigrant-brought crime. There’s also a photo showing refugees on the move that recalls an infamous anti-immigration poster — “Breaking Point” — used in the UK during the Brexit campaign.

The immigration issue isn’t confined to more rural areas. In elections in Geneva, a local populist group won one of the city-canton’s two seats in the upper house of parliament — a rare success for a minor party.

The Geneva Citizens’ Movement gained traction by campaigning for a law that requires employers to hire local residents before workers from nearby France, along with traditionally left-wing social measures.

Officials in both Brussels and Bern expect negotiations on a new EU-Swiss deal to start in the spring, but it’s far from clear how long they will take.

“Exploratory talks” went on for more than a year, so some of the details may already have been hammered out. But Switzerland’s government may not want things to move too fast to avoid looking like it gave in quickly to its bigger neighbor. That would undermine its ability to win over the wide spectrum of opponents who are already putting up barriers.

“To ensure Switzerland’s prosperity, we need immigration,” said Grossniklaus. “But it needs to be the right immigration.”

–With assistance from Jorge Valero.

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