The war’s impact on Europe has been significant. Heightened energy prices have affected countries heavily reliant on Russian gas, such as Germany. European nations have also diverted resources and attention toward Ukraine and away from other crucial areas like social spending and healthcare. Most fundamentally, the war has shattered the last remnants of trust between the East and West, leading many European nations to up their defense budgets in anticipation of a potential direct conflict with Russia.

Switzerland in the middle of an increasingly anxious Europe

Reflecting this defensive attitude, EU High Representative Josep Borrell said that Europe is a garden and the rest of the world is a jungle. Germany has closed its borders, apparently to avoid the jungle taking over the garden. Switzerland takes a more moderate approach. While acknowledging migration and integration challenges, the country emphasizes the need for proactive and inclusive migration policies.

Right-wing leaders are in charge in many parts of Europe, like Robert Fico in Slovakia and Viktor Orbán in Hungary. In Germany, the Alternative für Deutschland (AfD) party is on the rise, and in France, the National Rally party made a decent dent in the latest parliamentary elections. Switzerland finds the rise of right-wing, anti-immigrant populist movements across Europe to be a cause for concern. Unlike other European countries, though, Switzerland is a decentralized confederation. This offers a degree of resilience against nationalist trends that would seek to dominate politics at the countrywide level. Yet Switzerland remains uneasy about the deeper political and social crises of which the rise of the far right is a manifestation.

Switzerland the investor

In lighter news, Switzerland, Iceland, Liechtenstein and Norway signed a free trade agreement with India in March. Swiss diplomat Ralf Heckner has received the credit for achieving what the EU, the UK and the US failed to do. The secret of Swiss success is the country’s independent position. As a non-member of major trade blocs, Switzerland has greater flexibility in forging agreements with emerging markets. Additionally, India’s status as a rapidly growing economy and Switzerland’s political commitment to strengthening economic ties played crucial roles in the successful negotiations.

Switzerland is looking east for economic growth, with China and India among its top export markets. However, the country has adopted a cautious approach toward China’s increasingly assertive foreign policy, economic slowdown and challenges faced by private actors. 

Switzerland the peacemaker

As a famously neutral territory for peace talks, Switzerland hosted a summit to resolve Sudan’s ongoing civil war. Yet Sudanese General Abdel Fattah al-Burhan, head of the Sudanese Armed Forces, decided to sit the talks out. Despite his absence from recent negotiations, Switzerland remains committed to facilitating dialogue and humanitarian access.

Switzerland has faced more than one setback in Africa in recent times. The cocoa crop in Côte d’Ivoire and Ghana is facing its third tough year in a row. Chocolate-loving and chocolate-producing Switzerland may need to diversify its cocoa supply chain and include more suppliers from Latin America, with which it maintains cordial relations.

Finally, remaining in the Western Hemisphere, Switzerland views the current state of American democracy with concern, particularly regarding the deep political polarization and potential challenges to the peaceful transfer of power. The US is the preeminent global superpower, and uncertainty about its future direction adds to instability everywhere.

To manage these risks, Switzerland has adopted a flexible and open-minded approach, maintaining communication channels with both major political parties in the US. This proactive strategy ensures continued cooperation and stability in its relationship with the global superpower, regardless of the election outcome.

[Peter Choi edited this podcast and wrote the first draft of this piece.]

The views expressed in this article/podcast are the author’s own and do not necessarily reflect Fair Observer’s editorial policy.

The post A Swiss Perspective on World Affairs Today appeared first on Fair Observer.

Switzerland has been neutral for so long that neutrality has become part of its identity. It is what makes the country unique, giving Switzerland a unique vantage point in world affairs. To find out more, we asked Swiss diplomat and author Thomas Greminger the question: “How does Switzerland see the world?”

Of course, in many ways, the world doesn’t look so different from the high Swiss Alps as elsewhere. International norms seem to be crumbling. Russia has brought back hard-power politics and invaded its neighbor, Ukraine, with no legal justification. China is eyeing Taiwan and staking out the South China Sea as its private lake — much to the chagrin of its neighbors who share this sea. War has broken out again in the Middle East, with Israel invading Gaza and missiles flying everywhere from Yemen to Pakistan. The world is chaotic indeed. There is much wisdom in the Swiss policy of staying out of conflict.

The US has played its part, and so have others

Many Swiss observers lay the blame for this chaos at the feet of the US. The global hegemon has not done a good job of managing affairs as of late. Donald Trump, the former president and the Republican frontrunner for the presidential ticket, introduced much instability into the international system. His unpredictable and erratic foreign policy left both allies and foes guessing. Today, countries from the Middle East to East Asia are increasingly worried that they will have to rely on their own devices instead of the US. They are preparing for conflict rather than trusting in a tranquil, American-backed world order. This preparation has made nations more suspicious and more reactive, making the world more volatile.

As nations pull up the drawbridges, they are economically disengaging from each other. Nearshoring, friendshoring and reshoring are the watchwords of the day. Trade between China and the West is under strain as Washington and Beijing impose tit-for-tat tariffs in an ongoing trade war. Financial interconnectivity between the developed world and the developing world is under pressure. 

Even as trade declines, China’s economic growth is flagging. Like Germany, Switzerland is feeling the pinch as China enters a deflationary period and Chinese demand for foreign goods consequently drops. Fortunately, Switzerland is more diversified than Germany and not as reliant on exports to China as its northern neighbor. Therefore, the Swiss economy is not suffering as much as the German one.

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Not only the Chinese economy but also the Latin American economies are in the doldrums. Much of Africa is suffering and military coups are overthrowing democratic governments in many countries. Some of these coups have popular support. Even Asian economies, with the exception of India, Vietnam and a handful of others, are no longer growing that fast. Switzerland, with a highly developed financial industry, has been deeply invested in developing economies across the world. For now, the only thing this small country can do is batten down the hatches, continue to diversify and hope for more favorable conditions in the future.

Swiss observers are worried, too, about the state of their own continent. Democratic norms are weakening in Europe. In the Netherlands, the nationalist, anti-Muslim politician Geert Wilders took the lion’s share of votes in the November 2023 elections. In Germany, the far-right Alternative for Germany is on the rise. And Georgia Meloni, the far-right prime minister of Italy, hails from a party with post-fascist roots. The chatter in Austria, Switzerland’s neighbor to the east, is that the populist Freedom Party is looking strong. Austrians go to the polls in June. In Slovakia, Robert Fico has begun his assault on democratic institutions, attempting to bring the mechanisms of the state under his party’s control. In Hungary, Viktor Orbán has already accomplished this feat, turning Hungary into an illiberal democracy.

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The world may not quite be coming apart at the seams, but Switzerland must proceed cautiously if it does not want to become isolated in its own neighborhood.

How Switzerland is getting on in a dangerous world

The Swiss, of course, don’t have to worry about being invaded like the Ukrainians or the Taiwanese. Switzerland is armed to its teeth, and this mountainous country is a natural fortress — dotted with bunkers for good measure. But even the Swiss cannot live in the world alone. The country has deepened its relations with the EU and even with NATO. In the past, Switzerland failed to find a solution to engaging with the EU that balanced integration with Swiss independence. But recent global unrest has driven Bern and Brussels closer together.

Switzerland has participated in European sanctions against Russia because Swiss neutrality does not necessarily exclude participating in international sanctions. Switzerland’s neutrality policy took current legal shape in 1993 after the end of the Cold War and allows for sanctions. The real novelty in Switzerland’s foreign policy is that it has begun to cooperate with like-minded nations in security. In 2023, Swiss defense minister Viola Amherd achieved a historic first by participating in a meeting of NATO’s decision-making body, the North Atlantic Council. Switzerland may not be abandoning neutrality, but it is certainly moving much closer to Europe and the US than ever before.

Still, Switzerland is not turning its back on Russia or other non-Western-aligned powers. Switzerland prides itself on being a place where officials and experts from deeply opposed nations can meet and work together. The country is, for example, one of the last places in the world where US and Russian policymakers can still discuss nuclear weapons. Arctic powers, including the US, Canada and Russia, meet and speak here. In an increasingly divided and suspicious world, neutral Switzerland’s importance is increasing.

Switzerland is not immune to the unrest

Many look upon neutral and prosperous Switzerland as an island of stability. In many ways, it is so indeed. Swiss democracy has been resilient and moderate. It is a federal, semi-direct democracy that gives its voters a real voice in how their local, regional and national governments are run. The application of this principle of subsidiarity is a rarity and makes Switzerland unique.

Yet many Swiss citizens feel that the system is not being run in their interest. They see Switzerland’s many advantages being used to enrich a small elite, rather than the common people. Prices are running high and few own houses or can buy them. Many are resentful and are turning to populism. The Swiss People’s Party has grown stronger and poses a threat to Switzerland’s liberal democratic status quo.

Switzerland must navigate the territory carefully. As it copes with the modern world, this idyllic mountain country must avoid compromising its traditions of neutrality and Swiss citizens’ personal freedoms. The relatively new Swiss law, Measures for Protection against Terrorism, has many worried that the government may begin compromising the rights to privacy or free expression. Yet, for now, Switzerland seems to have crafted a legal solution that adequately balances security with these values.

In an uncertain world, Switzerland must strive to draw on the best of its political heritage, trudge forward and stay the course in hope of better days ahead.

The views expressed in this article/video are the author’s own and do not necessarily reflect Fair Observer’s editorial policy.

The post FO° Talks: Making Sense of the World Through a Swiss Lens appeared first on Fair Observer.