EU-Swiss draft treaty strengthens cross-border trade, improves framework for dispute resolution

A framework to strengthen and simply procedural norms between the European Union and Switzerland hangs in the balance as the Bern government meets to consider whether to break off talks over ratifying the draft treaty that was struck in 2018.

A Summit last month did not yield any resolve with both sides sticking to their points of views; the pact has been widely criticized within Switzerland. The draft agreement focuses on five areas such as mutual recognition of industrial standards, free movement of people, processed farm goods, civil aviation, and land transport.

According to a political source, Switzerland was very insistent on getting concessions on state aid, citizens’ rights, and labor rules; the source expects the cabinet to cancel further negotiations.

Swiss media reports said the deal was on the verge of collapse, despite the fact that the EU is Switzerland’s biggest trading partner; long term implications include a jeopardization of the de facto Swiss membership to the bloc’s common market.

Ties between the two are governed by more than 100 bilateral agreements stretching back to 1972.

If Switzerland fails to strike a deal it would be akin to hammering its own foot since it is likely to result in the country not gaining access to the EU’s single bloc market. Things could potentially worsen for Switzerland since over time existing accords will also erode, including an agreement on cross-border trade in medical technology products, which lapses this week.

Critics of the pact say, the agreement infringes over Swiss sovereignty. On its part, the EU aims to have an overarching treaty that aligns non-EU members closely to its single market rules, while providing more effective ways to resolve disputes.

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