The BCC’s Head of Trade Policy, William Bain, recently spent three days in Switzerland, looking at its trade with the UK and relationship with the rest of Europe.
This is what he learnt:
Switzerland is one of the UK’s strongest trading partners with a depth to its finance and services trade that mirrors our own. It is also at the heart of Europe’s life sciences and pharmaceutical industries.
As a member of the European Free Trade Area, while sitting outside the European Economic Area, it can set its own course on many regulatory issues.
But it retains close links with the EU Single Market, particularly in goods. These have been developed through bilateral agreements with Brussels over the past half a century, though Switzerland is also a full participant in the Schengen Zone, allowing friction free movement through Swiss territory for qualifying citizens.
As such, thousands of workers in France and Germany commute across the border into Switzerland every day,
working in its fast-growing sectors like pharmaceuticals.
During the BCC’s visit, with UK and Swiss business representatives and officials, the key focus was digital trade, customs facilitations and the future of UK-Swiss economic relations.
This dialogue comes at a timely moment, with negotiations between London and Bern well under way on an upgraded set of trading terms – prospectively covering digital trade and services.
The current continuity agreement, dating from before the UK’s EU exit, covers only trade in goods. The ambition of both sides is to go further. They want to produce a future-proofed modern agreement, fit for the trade opportunities of the second quarter of the 21st century, where services are more prominent.
And our co-operation has already yielded much in the last three years – with the adoption of the Bern Agreement providing a boost to growth, through mutual recognition of financial services regulations.
During this visit I also saw the very best of Swiss technical and policy ingenuity in improving the customs journey of lorries and goods moving in and out of Switzerland.
It is reforming these at pace, as the roll out of new customs processes speeds up the movement of goods through the Swiss border. This is vital to its long-term commercial success as a key supply and transit route, linking southern Europe with ports and consumers in the North.
It was impressive to see how it works in practice, and European customs co-operation should scale up this system. Eventually, it should become a part of both UK and EU customs processes within the New Computerised Transit System.
Switzerland has long been a reliable and stable trading partner for the UK, with a similar mindset on digital trade and emerging policy issues at the World Trade Organisation.
As third countries to the EU, there is a common experience of building a stable but different relationship with Brussels. And with Basel under two hours journey time from Edinburgh, and Zurich two hours from London, thousands of business travellers every year can benefit from in-person access to build business links.
If our negotiations for a new free trade agreement succeed in the coming months and years, an even more prosperous chapter in Swiss-UK relations can begin to be written.