A new deal set out in nearly 1,000 pages of text, involving six market access agreements, that try to bring order to the thicket of previous arrangements, would bind Switzerland to mirror changes to EU legislation in areas including the regulation of goods, migration, electricity, and transport, or face retaliatory measures. Bern would have little influence over how the rules develop, but it would be obliged to pay €375mn annually into the EU budget.
The inexorable gravitational pull that Brussels exerts, intentionally or not, simply by being the world's largest single market, is having the same effect on the Swiss as it is on the UK. Being outside and on the periphery means two things. First, that it is your biggest export market, and secondly, that border friction makes trade more expensive, and therefore, you are less competitive than all the other businesses inside the market providing the same goods or services. It is not rational.
In short, being outside comes at a cost. In Switzerland's case, they already follow much EU law, but don't do it automatically. That 'freedom' and potential flexibility come at a cost, and the EU doesn't like having to constantly negotiate with Bern. The EU Commission has wanted to end the arrangement for a very long time. That time is coming soon. In 2027, a referendum will be launched to approve the new deal. If not, the bilateral arrangements will gradually come to an end, squeezing out the Swiss even more
I smiled because the Swiss option was once a favourite of Daniel Hannan and even Richard Tice. In 2017 Hannan thought EFTA was the preferred option. Writing in Conservative Home, he concluded that we "can aim for EFTA, working as closely as possible with our European allies."
Switzerland was and still is in EFTA, but the Swiss have a far more comprehensive deal with the EU, conflating the two doesn't help with clarity, but that was never Hannan's strong point.
Here's Hannan again, this time on Twitter in November 2018:
Four years later in 2022 he had dropped options 2 and 3 and was calling for Britain to go full Singapore-on-Thames. In the pages of The Telegraph, he wrote: After Brexit we should have gone Swiss. Now we have no option but to go Singaporean
Switzerland's model "would have placed Britain at the head of an outer ring of European states that wanted to retain their sovereignty – a status that might, in time, have appealed to some existing EU members. Being off-the-peg, it would have been quick to agree, sparing us years of bitter wrangling."
Most people who followed these things knew by 2018 that the EU would never have agreed to the Swiss option for the UK. The deal was high-maintenance and clunky, and Brussels was never going to add to their own workload by giving us (a market nearly three times the size of Switzerland) a deal that they were already trying to bring to an end.
It was obvious then that Hannan hadn't got a clue. This paragraph in his ConHome piece where he was arguing for EFTA struck me:
"In many places, you can cross between Switzerland and the EU without noticing, and such minimal infrastructure as exists is mainly about making sure that foreign drivers have Swiss road discs. In any case, Britain has already promised not to put up border posts on its side of the line whatever the outcome of the talks."
I have crossed the border between France and Switzerland dozens of times (you can even do it inside the arrivals and departures in Geneva airport, which has a French side), and the reason you can cross "without noticing" has nothing to do with EFTA. It's because Switzerland is in the Schengen free movement zone. He’s also wrong about the Swiss road discs, they are vignettes which permit you to use Swiss Motorways. You are legally entitled to use ordinary roads without permission.
And take note that in 2018, Hannan thought staying in the EU was a better option than being in a customs union and following EU standards as a non-member (which is largely what the EEA and the Swiss model involve).
Richard Tice, the multi-millionaire funder of Reform UK, now MP for Skegness and resident of Dubai also once extolled the virtues of a Swiss-style deal, even quoting Hannan, again in Conservative Home in 2014:
He wrote (Don't laugh): "The UK is the EU’s biggest and best customer and the CEOs of EU businesses will be demanding it has to stay that way. The prospect of trade barriers is consequently zero."
Zero! What an idiot.
"Switzerland, explained Hannan, is obliged to meet EU standards when it trades with its member states – but is free to apply its own laws for any other commerce.
"Hannan’s proposal [Switzerland], when it is finalised, could well provide the positive alternative an outward-looking Britain requires."
They were all clutching at Hannan's straws.
You can tell how the Brexiteers were all at sea in a parliamentary paper from June 2018 which reveals all the options for Brexit that different people (Hannan's name appears in it seven times!!) were proposing at one point or another. On the idea of a Swiss type deal it had this to say:
"In 2010, however, the Council of the European Union described the model of EU-Swiss relations as 'complex', 'unwieldy to manage', and as having 'clearly reached its limits'. In the absence of any appetite on the EU side to enter into such an arrangement, and given the tensions and difficulties already alluded to, the ‘Swiss model’, or a variant thereof, may not be feasible."
This was six years before the EU referendum on Brexit, but the Brexiteers were still suggesting the Swiss model as a template for the UK! It is now obvious that Dominic Cummings was right when he said that it was impossible to reach a consensus among its advocates on what leaving the EU actually meant.
I am certain there would never have been a majority for any sort of Brexit if the public had heard all the often fatuous and competing arguments inside the Leave camps that were being aired, hotly debated, and negotiated between 2015 and 2020. It is why we have ended up in what Hannan calls the worst of all worlds, following EU laws (and far more to come under Starmer's new deal) with zero influence and even paying for the privilege.
If you don't know your destination when you set out, and one of the suggested points of disembarkation is a moving target, you shouldn't be surprised that you end up lost.
Brexit made no sense in 2016, and it makes even less sense now. As people are beginning to see.
