All eyes in Bern are on Jean-Claude Juncker’s visit to Switzerland on September 19. Bern hopes for a compromise that would allow Switzerland to somehow limit the freedom of movement of EU citizen. But, it is hard to imagine that the effect of this discussion will not affect British negotiations, which take place in a directly comparable political context. Give the Swiss what they ask, Britain will make similar demands; deny them a deal and you set a precedent for negotiations with London.
Free movement of labour
Any deal compromising on free movement of labour would set a precedent directly relevant to Brexit negotiations, although Britain insists it is seeking a unique relationship with the EU, unlike Switzerland and Norway.
Officials in Bern have been trying to implement curbs on EU migrants following the results of a 2014 referendum, a political context directly comparable to Brexit. But, the EU is making no concessions so far. Speaking to Bloomberg, Former Bank of England policy maker Adam Posen warned the European Commission was playing “hardball” with Switzerland, even before Brexit.
25% of the residents of Switzerland are foreign nationals. Bern now hopes to come to an agreement under which a current resident of Switzerland – Swiss or EU citizen – will have preferential access to its job market.
The Swiss People’s Party (SVP) that spearheaded the anti-immigration campaign in 2014 opposes the deal and wants a clear-cut quota system. If such an arrangement makes it through the parliament despite SVP opposition, the far-right party could still collect 50,000 votes to force a second referendum on the issue.
The Leave campaign in the U.K also advocated an effective “quota” system, speaking about an Australian-inspired regime. That would include a point system with a ceiling on immigrants no matter where they came from, skilled and unskilled.
But, Theresa May ruled out a point system this week.
Theresa May said that a point-based system would entitle anyone who met entry criteria entry in the U.K to settle. That “entitlement” is the problem. The British government wants to end “free movement” without necessarily ending preferential rights of residence for EU nationals after Brexit. That signals a deal framed to resemble Switzerland.
In Switzerland, like the U.K, there is an initiative calling for a second referendum to annul the 2014 result. Since 2014, a third of those who backed a quota on EU migrants have changed their mind and would now vote to preserve Switzerland’s special access to the Single Market.
The call for a second referendum in the U.K has a number of supporters, but no political momentum. Theresa May has time and again excluded this possibility.
The Remain campaign has now been succeeded by the “Open Britain” campaign which, in a letter to the Sunday Times last Sunday, admitted that Leave was a vote that calls for a managed migration regime. Therefore, the campaign now urges the government to do its utmost to retain membership – which is more than the Swiss have – of the Single Market.
Rebranding itself as the “Open Britain” campaign, the group is calling for a migration regime that is “open to talent” but shields the labour market from “excessive competition.” Supporters include former ministers Anna Soubry (Conservatives), Norman Lamb (Liberals), and Pat McFadden (Labour).
About cherry picking
For both the Swiss and the British, what is at stake is access to the Single European market. France’s foreign minister in 2014, Laurent Fabius, said the EU would review its relations with Switzerland if it moved to curb EU immigration rights. The German Foreign Minister Frank-Walter Steinmeier warned that “cherry-picking with the EU is not a sustainable strategy.”
The very same term – “cherry picking” – was used by the French and German governments in relation to Britain.
Switzerland exports 60% of its goods to the EU, selling everything from cheese to drugs, as well as all kinds of services, including financial services of the kind London is interested to sell. But, “passporting” comes at a price.
Switzerland’s “special relationship” with the EU has been built through seven interlinked agreements negotiated since 1999. If one agreement goes, the package collapses, although that is for political rather than legal reasons as Giles Raymond DeMourot notes.
Unmistakably, the stakes are high. The relationship is worth for Switzerland 32 bn francs (€29,3 bn). Britain is, in fact, less dependent on EU trade. About 44% of UK exports in goods and services went to the EU in 2015, worth £220 bn (€261).
The cost of free movement of people
In these directly comparable negotiations, there is a significant difference. Britain is the first to negotiate access (or membership?) to the Single Market on its way out.
And there is a difference on free movement.
Unlike Switzerland, Norway, and Iceland, Britain opted out of Europe’s free movement Schengen area. There is now a thought of introducing a passenger registration system for those travelling to Europe – based on the US ESTA system – that could fetch €500-to €2bn per year,
In effect, one would pay a ticket to enter Schengen. That bill would be picked up primarily by the 30 million people visiting Europe who, like Britons, do not require a visa for EU entry.
(Bloomberg, The Guardian, The Sunday Times, The Independent)Are the Swiss negotiating Brexit?