Switzerland abandons negotiations to establish a closer relationship with the EU

Due to insurmountable differences on wages and immigration issues, the Swiss government cancelled the new framework agreement with the European Union, a move that will resonate as the United Kingdom seeks to readjust its relations with the European Union.

The decision of the Swiss Federal Council on Wednesday may have a profound impact on Europe’s fourth largest trading partner, which is also home to 1.4 million EU citizens. This caused a swift condemnation from the European Commission and warned that cooperation will inevitably deteriorate.

“We regret this decision,” Brussels said in a statement. “Privilege to enter the single market must mean compliance with the same rules and obligations.” Swiss export agreement 160 billion euros in goods and services I went to the European Union last year.

Berne’s decision to withdraw was made after strong domestic opposition to the draft treaty, which was considered an infringement of Swiss sovereignty, despite the country’s broad desire to maintain close relations with the European Union.

In 2019, the deadlock with the EU caused the Swiss stock market to lose its right to serve EU customers. At the same time, the union is worried that the new agreement will weaken high wages, and there are still disagreements on the issue of state aid — Berne lists the two as key issues.

“Therefore, the conditions for signing the agreement are not met,” the Federal Council said in a statement, adding that it hopes to retain existing trade arrangements “for the benefit of both parties.”

In the currency market, the Swiss franc was roughly flat at 1.09 against the euro that day.

The unique state of EU-Swiss relations has been a source of frustration for Brussels. It is based on more than 100 bilateral treaties to allow wealthy alpine countries to enter the single market in exchange for open borders and the unification of Swiss and EU laws.

Negotiations to reform these arrangements began in 2014, but Become more urgent As the EU is concerned that after Brexit, the UK may use the Swiss model as evidence, it should be able to select the benefits of the single market while remaining outside the formal EU structure.

Switzerland’s decision to abandon negotiations means that with the expiration of existing treaties, trade and immigration between Europe and the core countries of the European Union may be greatly restricted.

The Swiss government stated that it has begun stocking medical equipment and has taken other “preventive measures”, such as legal protection of listed companies in Switzerland, in the hope of imposing obstacles with the European Union.

The key regulatory permit allowing the sale of Swiss-certified medical devices in the European Union expired on Wednesday.

Berne decided to abandon years of negotiations, and Brussels was deeply frustrated. But the Swiss government has long struggled with how to sell the agreement domestically.

Under the Swiss consensus political model, any agreement must be reached in a national referendum and approved by a majority of the entire population and a majority of the country’s 26 cantons.

In an interview earlier this month, Petros Mavromichalis, the EU’s ambassador to Switzerland, warned that the dying negotiations were “a chronicle of predicted death.”

“Today is a victory for direct democracy, and therefore a victory for the Swiss people,” said Marco Chiesa, senior vice president of right-wing populism, Switzerland’s largest party.