"What did [Switzerland] produce? The cuckoo clock!” This quote, perhaps Orson Welles’ most famous line in the 1949 film The Third Man, harkens to the stereotype that Swiss neutrality is the reason for its supposedly insular and stagnant nature.
This stereotype is far from the truth though and downplays how much Switzerland can contribute to Europe’s defences without sacrificing its neutrality.
In fact, Swiss and EU policymakers are progressively recognising this possibility, and the latest development in this regard is Switzerland’s expected participation in the forthcoming €150bn Security Action for Europe (SAFE) defence industrial fund. As plans to establish the SAFE fund are moving ahead, Switzerland and the European Union should seize upon this momentum to negotiate a bilateral security entente.
An entente, in which parties only commit to mutual consultation, could pave the way for the partial lifting of export controls on Swiss defence equipment to EU members and Ukraine, as well as greatly increase Switzerland’s participation in EU-led defence industrial efforts beyond SAFE.
Crucially, an entente would also enable Switzerland to significantly deepen its defence collaboration with the European Union without sacrificing its historic neutrality.
The creation of a Swiss-EU entente would not necessarily be a major change in existing bilateral security cooperation either. Indeed, although Switzerland officially remains neutral, it has already expanded its participation in transatlantic and European security institutions over the past few decades, with Russia’s invasion of Ukraine only accelerating this trend.
Such multilateral partnerships include Switzerland’s ongoing priority to increase interoperability between Swiss and Nato military equipment and staff structures, an administrative arrangement with the European Defence Agency (EDA), the alignment of Swiss export controls and sanctions with EU export controls and sanctions on Russia, an increase in Swiss-Nato military intelligence sharing, minor Swiss participation in multilateral German-led logistical support exercises under the Framework Nations Concept, and full-scale participation in multiple Nato military exercises in 2024 and 2025.
However, this is not to say that Switzerland’s neutrality policy has no impact on Swiss-EU defence collaboration.
Most pertinently to SAFE, Swiss arms exports are constrained by the Federal War Material Act, which prevents both the direct export of military equipment to active belligerents in armed conflicts and the re-export of such materials from non-belligerents to belligerents.
In the context of the ongoing Russo-Ukrainian War, these restrictions have consistently prevented the re-export of Swiss-made military products from the European Union to Ukraine, complicating EU military aid efforts and frustrating EU policymakers.
Such constraints could even be used to prevent exports to EU members themselves if they too became active belligerents in an armed conflict, which would prevent any maintenance of their existing stockpile of Swiss military equipment.
Understandably, EU military companies have started to see Swiss export controls as an unnecessary risk factor, and now seek the removal of Swiss-manufactured components from EU military industrial supply chains entirely. As a result, Swiss arms exports, which reached an all-time high in 2022, dramatically slumped 30 percent by 2024.
Due to these events, Swiss policymakers have increasingly reconsidered how to approach neutrality.
For example, in addition to its existing work with the EDA and its forthcoming membership in SAFE, a consensus to relax some of its export controls is already emerging among Swiss policymakers.
This has included a recent cabinet proposal to the parliament to permit the re-export of Swiss equipment that was initially exported five years prior, with further reductions in export restrictions possible under “extraordinary circumstances.”
Ongoing Swiss-EU developments already look promising but even more could be achieved through a Swiss-EU entente.
As this entente would be centred upon a commitment to consult, Switzerland and the EU should look to create informal bilateral dialogue formats to discuss emerging European security issues.
These should include at least annual high-level meetings, biannual 2+2 consultative dialogues (in which the Swiss foreign and defence ministers would meet with their EU Commission counterparts), and the regular convening of expert working groups.
This framework would enable Switzerland and the EU to have regular and direct bilateral discussions on matters like defence industrial strategy, the possibility of a partial lift on the Swiss ban on arms re-exports, and the extent to which Switzerland can contribute to and benefit from other EU defence initiatives.
Accordingly, as Europe continues to face its worst security crisis since 1945, Switzerland and the EU have a historic opportunity to strengthen their cooperation in security policy. To unlock more potential here, they must establish a bilateral entente with a commitment to consult.
This arrangement would ensure that Switzerland can support Europe’s ongoing rearmament without conceding its neutrality and simultaneously enable the European Union to make substantial contributions of its own to Swiss national security and defence preparedness.
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Francis Shin is an author and research analyst focused on global security, democratic resilience, and grand strategy.
Francis Shin is an author and research analyst focused on global security, democratic resilience, and grand strategy.