Swiss-EU relations challenged by eastern workers referendum

"Six months ago, we were very optimistic about this vote. But now we get news of companies having troubles every morning, of jobs being cut, of people going on unemployment. Such a situation promotes protectionist reflexes. People fear losing their job and this is not a context favourable to a vote on the free movement of people," the Swiss ambassador to the EU, Jacques de Watteville, told the EUobserver.

The anti-immigrant Swiss People's Party (SVP) has picked up on these fears ahead of Sunday's referendum (8 February) with posters showing huge black crows picking at the Swiss map, echoing a 2007 poster campaign in which three white sheep kick a black sheep off of the Swiss flag they all had been standing on. The poster, notorious across Europe and accused of being racist, was banned by the Geneva city council at the time .

"Extending freedom of movement to people from Romania and Bulgaria is an excessive concession if we consider their economic delay, corruption, criminality and high unemployment. The consequence would be a plundering of unemployment, motherhood and invalid benefits. This would lead to higher taxes and VAT, jobs would be lost and foreign criminality would rise", the No-campaign website argues.

"The government is very unhappy about this campaign. The posters of the No-campaign do not at all represent the position of our authorities. It is done by right-wing nationalist people," the ambassador said.

He pointed out that the measures taken by the Italian government to eradicate the Roma camps forced some of these migrants to come to Switzerland. "Some crimes also happened in Switzerland and this didn't help at all," he said.

EU-Swiss relations

A No in the referendum on the freedom of movement for Bulgarian and Romanian workers, who became EU citizens in January 2007, could lead to a freeze in some of Switzerland's trade and transport agreements with the EU, Mr de Watteville admitted.

The most recent polls show 50 percent in favour, 43 percent against and seven percent undecided, following the treand of recent years of opposition to the free movement of people.

"Above all, a negative vote will have negative consequences for the Swiss economy. It will not block the EU as with the Irish No because we are not a member state. A negative vote will however create a problematic situation for both sides," he said.

The ambassador explained that the agreement on the free movement of people with the EU was linked to six other agreements, ranging from transport to trade, which would be terminated altogether in the case of a negative vote.

Exports to the EU market – for instance the famous Swiss cheese - would face extra hurdles and costs, with air, land and rail transport also becoming more complicated until new agreements were adopted.

Switzerland's recent participation in the EU's border-free zone, the so-called Schengen area, could also be at stake, Mr de Watteville said, adding that a second referendum on the issue has not been ruled out.

"There is no juridical link between the Schengen agreement and the one concerning freedom of movement, but there is a political link. And in practice, Schengen is linked to free movement of people. So it won't be a surprise for us if the EU decided to suspend the Schengen treaty if we say 'no'," he admitted.

EU justice commissioner Jacques Barrot had warned end of last year that if the referendum proved negative, "it would involve a real problem and would probably mean that the presence of Switzerland in the Schengen area would be interrupted."

Vote on EU enlargement

The Swiss diplomat welcomed the EU keeping a 'low profile', as national sovereignty was of great importance to the increasingly eurosceptic populationc. On EU membership, opinions are now less favourable than 20 years ago, he added.

"But this is the case in all of Europe. The EU is less and less popular in a lot of countries - as we have seen in Ireland," Mr de Watteville said.

"The fear is that if we would join, it would affect our three core principles: direct democracy, neutrality and federalism. All these treaties allow us to be associated to the internal market without automatically adopting the EU regulations and losing our political peculiarities," he explained.

However, the tendency remains to move towards greater integration with the EU, as Switzerland has some 120 agreements with the union, including the "small but essential" package at stake on Sunday, the ambassador said.

He also noted that the vote was the only one in Europe which was linked to the enlargement of the EU to Romania and Bulgaria.

"It is somewhat paradoxical that the only nation voting on EU enlargement is Switzerland, which is not a member state," he concluded.