Analysts say that after Switzerland decided this week to abandon a deal that would bring it closer to its largest trading partner, it will pay the price for lost exports, increased costs and reduced attractiveness as a business hub.
Although Eurosceptics on the far right celebrated the collapse of its so-called “colonial” treaty and the left cheered for support measures to defend Switzerland’s high wages, companies and economists warned of the major economic consequences that followed.
According to Reuters, Switzerland will not fail, but will gradually come under pressure due to the obsolescence of more than 100 bilateral agreements that ensure the smooth flow of cross-border trade, while Brussels has vowed not to grant the country any new market access opportunities without contracts. .
As the agreement between the two parties to reach a consensus on industry standards (MRA) expired this week, the medical technology field has felt insufficient, which means that Swiss medical technology manufacturers enjoy the same treatment as any country outside the European Union.
Industry body Swiss MedTech announced that the new management requirements will initially cost the industry approximately 114 million Swiss francs (US$127 million), and then 75 million Swiss francs a year.
Although this is only a small part of total exports (5.2 billion Swiss francs), non-European companies and start-ups face greater dangers, which will avoid Switzerland when choosing a location for their European headquarters.
Beat Vonlanthen, President of Swiss Medical Technology Corporation, said: “Anyone who simply says that administrative costs are affordable has completely ignored the power of international competition.”
Within two to three years after the expiration of the MRA, the Swiss Engineering Department (MEM) may face difficulties, but the prospects for union and healthcare cooperation have dried up.
Swiss Mem (Mechanical and Electrical Industry Association) believes that a barrier-free approach to the single market is necessary. The association exports 80% of its products, of which about 55% are exported to 27 EU member states.
The Swiss memorandum said: “The thousands of high-quality jobs in Switzerland depend on bilateral arrangements.” He also pointed to the European Union’s electricity supply.
The association pointed out: “In order to ensure the safety of power supply and the increasing demand for power supply due to climate change, we believe that the power agreement is not only urgent and necessary for us, but also for industry,”
A study by the BAK Economic Research Center shows that trade interruptions due to technical barriers may reduce the sector’s exports of goods. By 2040, these exports may be directly affected by a 12% decline in cumulative terms.
They said: “The export-oriented Swiss economy depends on stable trade relations and therefore on an appropriate agreement with the EU. This is no longer the case without a framework agreement or clear alternative.”
Researchers at Swiss universities can no longer use the “EU Horizon” program, which provides scientists with billions of dollars in funding.
Detlef Guenther, deputy dean of ETH Zurich, said last month: “If Switzerland is no longer part of the Horizon funding scheme, it will be like being kicked out of the UEFA Champions League.”