Switzerland opens to Bulgarian and Romanian workers

Only three small German-speaking cantons and the Italian-speaking canton of Ticino voted against the pact, with the other 22 French and German-speaking cantons in favour.

The Swiss vote contrasts with protectionist reflexes surfacing in other European countries. British workers went on strike last week over a decision to bring in Italian and Portuguese people to work on an oil refinery, while in France, over 1 million employees from different sectors protested against pay cuts and job insecurity.

SVP, Switzerland's biggest party and the one which initiated the referendum, claimed a Yes would lead to job losses for Swiss workers, higher taxes and a rise in crime.

However, the agreement foresees a gradual opening of the labour market and transition periods of up to seven years, in which the Swiss government can limit immigration from Bulgaria and Romania by setting annual quotas for work permits.

A No vote would have severely strained Switzerland's trade and transport relations with the EU, as well as the country's recent membership to the bloc's border-free zone, known as the "Schengen area."

EU commission president Jose Manuel Barroso hailed the result of the referendum as "excellent," saying it extended a "key agreement" with the EU to the bloc's newest members Bulgaria and Romania.

A similar statement was also issued by the Czech EU presidency, congratulating the Swiss for having expressed the wish for "continuity in the co-operation with the EU based on the freedom of movement of persons, one of the fundamental European freedoms, which applies to all member states of the European Union."

The vote "strengthened the credibility of Switzerland" and gave "more weight in the bilateral negotiations with the EU," Jacques de Watteville, the Swiss ambassador to Brussels, told journalists on Sunday evening.

He added that the government paid particular attention to the concerns of the citizens who voted No and that the authorities would increase by 20 percent their controls on employers who hire migrant workers to make sure there would be no "social dumping."

The Romanian ministry of foreign affairs declared its "satisfaction" with the outcome of the referendum, underlining that "European co-operation was not affected by the negative stereotypes and fears floated during the campaign."

Davos forum stays, Zurich scraps riches privilege

Separately, voters in the Swiss alpine town of Davos on Sunday backed plans allowing the annual meeting of the world's richest to stay for at least the next 10 years.

An unusually high proportion of Davos's 5,900 voters turned out to support a €25.3 million extension of the town's ageing conference centre. The World Economic Forum had promised to remain in Davos for at least the next decade if the scheme – 75 per cent of which will be funded locally – was approved, FT reports.

For their part, German speaking voters in the canton of Zurich decided to scrap special tax deals for rich foreigners, although such arrangements were long established in French and Italian speaking regions.

Critics in Zurich claimed the tax deals pushed up property prices. The Zurich vote could have an impact on the country's financial negotiations with the EU.