Photographer: Chris Ratcliffe/Bloomberg

EU Playing Immigration ‘Hardball’ With Swiss, Posen Says

  • Swiss voted in 2014 to reduce immigration from European Union
  • Economically vital EU bilateral deal at risk for Switzerland

The European Union doesn’t appear to be inclined to grant Switzerland big concessions as it seeks to renegotiate immigration provisions with the 28-country bloc, according to Adam Posen.

“The Swiss are popular in Europe, their economy is incredibly integrated with Germany, let alone the rest of Europe, and they’re still being played very hard ball with by the Europeans and even were before Brexit,” Posen, a former Bank of England policy maker and president of the Peterson Institute for International Economics, told Bloomberg Television’s Francine Lacqua on Tuesday.

QuickTake Switzerland's People Power

Officials in Bern are trying to implement curbs on EU migrants voted for in a plebiscite two years ago, without annulling an agreement that could cost the Swiss an estimated 32 billion francs ($33 billion) a year in potential economic output. As with the U.K., following its Brexit vote, authorities in Brussels have told the Swiss that provisions allowing citizens of member states to take up jobs and residence without special permission cannot be revised.

Switzerland -- a quarter of whose inhabitants aren’t citizens -- isn’t an EU member, though the bloc is its top trading partner. At the heart of relations between Switzerland and the EU is a set of treaties that cover everything from agriculture to civil aviation and the free movement of people. They contain a “guillotine” clause that would nullify all if one is struck down. The Swiss government has until February to implement the new immigration curbs and has said it is prepared to enact them unilaterally if EU officials won’t budge.

No Quotas

Faced with the prospect of having to jeopardize the economy that has already seen its growth stunted due to the strong currency, some members of parliament are now considering abandoning the formal quotas the 2014 vote called for and adopting a system of granting current Swiss residents precedence on the jobs market.

Swiss Economy Minister Johann Schneider-Ammann, a member of the pro-business Free Democrats, called the proposal “interesting,” according to an interview with newspaper SonntagsZeitung on Sept. 4.

On immigration, “it’s very hard to negotiate, to get a softening of positions,” Oliver Adler, head of economic research at Credit Suisse, told Bloomberg Television’s Anna Edwards and Rishaad Salamat. “In the end, there will probably be some form of compromise.”

Such a deal may be discussed on Sept. 19, when European Commission President Jean-Claude Juncker visits Switzerland.

The Swiss People’s Party, or SVP, which spearheaded the anti-immigration initiative, is opposed to the parliamentary committee’s proposal to give current residents first dibs, saying it is a slap in the face to constitutional provisions that call for quotas to be implemented. Should parliament adopt that plan, the SVP could call a referendum to cancel the new law by collecting 50,000 signatures, though SVP Vice President Christoph Blocher has said such a move wouldn’t be worth the effort.

New Vote

There’s also a plebiscite -- known as “Get Us Out of the Dead-End Street”-- in the pipeline to nullify the 2014 plebiscite. The date for a national vote for that initiative has not yet been set.

Forced to choose between the EU accords or the SVP’s immigration limit, a “clear majority” would favor the former, according to a survey by gfs.bern published in May. A third of those who backed the quotas in 2014 would prefer to preserve the bilateral agreements even if it meant sacrificing the restrictions on newcomers, it found.

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