Switzerland as a role model for British Brexit? You are joking! Switzerland as a role model for British Brexit? You are joking!

In normal times, the British are not interested in Switzerland. Knowledge about our country hardly extends beyond the relevant clichés (chocolate, bells, mountains). Politically, Switzerland is irrelevant to them anyway. However, in recent days there has been a lot of talk about her in the London borough of Westminster and in the media.

The trigger was an article in the “Sunday Times”, which is usually well informed about government internals. Accordingly, the UK is considering “Swiss-style relations with Brussels”. It is about rapprochement with the European Union after the end of 2020, the Brexit, which has been finalized.

Its previous membership in the European market was replaced by a free trade agreement negotiated by then Prime Minister Boris Johnson. It is now becoming increasingly clear that this treaty is no substitute for unfettered market access. On the contrary, Brexit has proved to be a heavy burden on the British economy.

Approval deeper than ever

This one suffers from acute growth weakness. Inflation in the UK is higher than in the Eurozone. Part of the problem is homegrown, with Prime Minister Liz Truss’s hara-kiri economic policies lasting 45 days. However, according to economists or the Bank of England, Britain’s central bank, Brexit will make things significantly worse.

It is slowly dawning on the British that the 2016 referendum was a bull’s-eye. In the multi-year study by research institute YouGov, the gap between opponents and proponents of Brexit is widening. Currently, 56 percent of those surveyed describe the exit as a mistake. Only 32 percent still think it’s good.

Brexit hardliners are alarmed

Government officials have indicated they want to remove the biggest trade barriers with the EU, such as Treasury Secretary Jeremy Hunt, who rejected Brexit in 2016. One option is bilateral agreements based on the Swiss model to at least gain sectoral market access. The business community has been calling for such schemes for some time.

The “Sunday Times” article has been interpreted by commentators as a test balloon. As expected, the idea did not go down well with the Brexit hardliners. Any adoption of EU rules, whether Swiss or not, would be “totally unacceptable,” said David Frost, who had brought the final Brexit on the scene as chief negotiator.

Minister admits “frictions”.

Officially, the Conservative government sees it the same way. A spokesperson described the speculation of a “Swiss solution” as “totally untrue”. Prime Minister Rishi Sunak pointed out on Monday at the annual conference of trade association CBI that he voted for Brexit in 2016. He could bring “huge benefits and opportunities”.

Current health minister and former Brexit minister Steve Barclay admitted to Sky News “difficulties due to greater friction” in leaving the single market. But Brexit also creates “significant opportunities”. Little has been seen of them so far. For example, the hoped-for free trade agreement with the US is still a long way off.

Swiss problem with the EU

Nevertheless, the Swiss model will probably only appeal to the government to a limited extent. In London, too, people have come to realize that the “cherry picker” bilaterality is a thing of the past. The EU is requiring Switzerland to adopt “dynamic” EU law and the European Court of Justice (ECJ) as a dispute settlement body.

The Bundesrat therefore allowed the negotiated framework agreement to fail. Switzerland is now learning how difficult it is to start over. This is not the only reason why the model should have a rather deterrent effect on the British government. Because the “Swiss way” also includes regular cohesion payments and the approval of the free movement of people.

No “Fortress Britain”

It’s a red flag for many Britons. Strong immigration, especially from Eastern Europe, was the main reason why a narrow majority voted to leave in 2016. The disadvantages in this area are becoming increasingly apparent. With the loss of the free movement of people, the shortage of labor in Britain is only getting worse.

CBI chief Tony Danker on Monday called for more “economic migration” in areas where there is a shortage of skilled workers. Even Simon Wolfson, head of the fashion chain Next and a Brexit supporter, warned on the BBC of a ‘Fortress Britain’ that raises its drawbridge to foreign workers and harms the economy.

Dream of “future industries”

The ruling Tories have (still) fallen on deaf ears. They have to bury the dream of ‘Singapore on the Thames’ with low taxes and deregulation for now. But they want to make the kingdom the preferred location for high-growth “sectors of the future” such as fintech, green energy, AI and life sciences.

However, this requires skilled workers. Even less glamorous but existential sectors like the National Health Service (NHS) depend on immigration. In addition, Great Britain gets a considerable part of its imports, for example of food, from continental Europe and therefore from the unloved EU.

Bizarre change of perspective

After the Brexit vote, local EU opponents looked at the island with admiration. They were wildly enthusiastic about such a free trade agreement between the EU and Canada as an alternative to the framework agreement. Now the British have one and they think it’s not enough. That is why some now see the Swiss bilaterals as a model.

This change of perspective seems bizarre, yet it is symptomatic of the twisted relationship between the two countries and the European Union. They struggle with the realization that the EU is too big and too important to simply ignore.