A mountainous confetti of barely 41200 square kilometres encircled by a growing empire of 495 million inhabitants: on the political map of Europe, the country of William Tell is increasingly identified with the little village in Asterix besieged by Caesar's troops, whose role could be taken over, in the 2007 version, by Jos\u00e9 Manuel Barroso, the President of the European Commission...<\/p>\n
The image is picturesque, but deceptive. Of course, the Swiss Confederation is still not part of the European Union and, in view of opinion polls and actual votes, a formal application for membership is not expected any time soon. But within Europe as a whole, Switzerland is far from being a floating island supplied only by air bridges. And the reality of the figures shapes the links in the chain that anchors the Confederation to its continent. For example, the countries of the European Union account for almost two-thirds of Switzerland's exports, while 80 % of its imports come from the Community, making it its second-largest customer, ahead of countries that are not exactly economic dwarfs: Russia, China and Japan!<\/p>\n
The same interdependence applies to investments, since the European Union accounts for almost 45 % of Swiss investments abroad, while 56 % of investments received by Switzerland come from the Union. The symbiosis is also human: Switzerland has 850,000 EU citizens on its territory, \"that's more than the population of Luxembourg and Malta put together\", according to the Integration Office, the federal body responsible for representing Switzerland's interests to the European institutions.<\/p>\n
For its European neighbours, Switzerland may be a safe haven, but it is certainly not a bunker, and since the creation of the Integration Office in 1961, the Confederation has endeavoured to follow the Community movement, albeit from a distance, according to the compass of its interests. There was even a time when the cohabitation between partners almost evolved into an advanced flirtation.<\/p>\n
After signing the agreement on the creation of a European Economic Area (EEA) in May 1992, Switzerland applied to open negotiations for full membership of the European Union. But the process was suddenly - if not definitively - blocked by the referendum rejection of the agreement on 6 December 1992. Since then, therefore, Switzerland's leaders have stuck to the cautious but very active principle of \"bilateralism\". The links forged between Switzerland and the EU are based on a tedious list of bilateral agreements - around twenty main agreements and a hundred secondary agreements - concluded subject by subject and negotiated paragraph by paragraph. At the heart of this are the two major packages of \"Bilateral Agreements I\" (1999) and \"Bilateral Agreements II\" (2004), which opened up markets and allowed the free movement of people, as well as a series of cooperation agreements (on security, combating fraud, research, the environment, etc.) that go beyond the simple imperative of free trade.<\/p>\n
The generally smooth progress of the bilateral negotiations does not, however, rule out potential disputes. The most obvious, and the most nagging, obviously concerns tax issues, and in particular the tax breaks granted by certain Swiss cantons to European holding companies established on their soil. The European Commission regards these tax breaks as subsidies in breach of the bilateral free trade agreement signed in 1972. The dispute, which arose in autumn 2005, is far from marginal given that 20,000 Swiss and foreign holding companies based in Switzerland generate tax revenues of more than \u20ac4 billion. It came to a head in spring 2007 when the Swiss Finance Minister proposed a tax reform for income tax and gave the European Commission a mandate to conduct discussions with Berne on this stumbling block.<\/p>\n
In recent years, the Swiss authorities have given further proof of their commitment to Europe, notably through their active participation in financing the enlargement of the Union. But here again, Switzerland's substantial investment - to the tune of CHF 1 billion (\u20ac600 million) - in the new members of the Community cannot be interpreted as a sudden surge of Europhilia, but rather as the latest manifestation of a relationship that is essentially utilitarian in nature. To justify this financial contribution to reducing economic and social disparities in the enlarged EU, the President and Chancellor of the Swiss Confederation stated last December that \"Switzerland has every interest in seeing the new EU members integrate harmoniously into Community structures\", pointing out the benefits for Swiss businesses of seeing the bilateral agreements extended to the new entrants from Eastern Europe, \"a region whose economic growth is one of the most dynamic in the world\". So it's hardly surprising that the bulk of Switzerland's contribution was reserved exclusively for its main trading partners...<\/p>\n
It's a logical progression in the history of relations between Switzerland and Europe, where lyricism has always given way to well-informed self-interest. But sometimes the most beautiful unions are born of marriages of reason.<\/p>","protected":false},"excerpt":{"rendered":"