In the midst of such banking turbulence Another interesting “news” issue is that although Switzerland is in Europe and is surrounded by countries in the European Union (EU), starting with France, Germany, Austria and Italy, but Switzerland is not. Being in the European Union (EU), including the Swiss monetary system, is completely separate from the EU, both the currency and the central bank.
The obvious is Last week, while the European Central Bank (ECB) raised the policy rate by 0.50% to 2.50% amid the EU’s average inflation rate in February at 8.5%.central bank of switzerland (SNB) raised the policy rate by 0.50 percentage points to 1.50 percentage points amid a banking crisis and February inflation at 3.4%.
However, a number of analysts see that too. Certain “peculiarities” of the political culture and financial sector structure led the Swiss authorities to decide not to join the EU. Ultimately, the lack of membership in the bloc resulted in the Swiss financial system being clearly separated from the EU countries.
So, knowing the reason why Switzerland did not join the EU. It may make us understand the origin and origin of the separation of the financial sector more clearly.
analysis “Why Switzerland Is Not a Member of EU?” According to the International Wealth.info website, the top five reasons why Switzerland does not join the EU include:
1. History-politics-military neutrality
The first reason Switzerland does not want to join the EU is because This is the “history of neutrality” of the country, which many of Switzerland’s leaders have held for centuries. Including every war and conflict in Europe. This position has greatly contributed to Switzerland’s balance between “economy” and “state security”.
In the late 19th century, the Swiss government adhered to another important geopolitical principle: “Military Neutrality”
Therefore, if Switzerland agrees to join the EU Such principles may disappear. This is because all member states are obliged to strictly adhere to EU policies and strategies. and finally The image of Switzerland as “International arbitration” and “peace negotiation advocates” disappear in the blink of an eye.
2. Stable economic environment
Many analysts agree that the Swiss economy is relatively strong and wealthy. despite facing sanctions or face a global crisis Including Switzerland is also a country known for having “Progress” in one of the most countries in Europe as well.
Moreover, Switzerland is one of the few countries that have overcome the financial crisis caused by the COVID-19 pandemic. effectively and with very little pain important after the crisis The Swiss economy can continue to grow. Among many countries in the EU that have entered a recession (Recession)
While the average inflation rate in Europe in 2022 was 10.1%. currency swiss franc can also hold position “The most stable currency in the world” Amid inflation in the country at only 2.83%.
The analysis states that For other countries in Europe that have lower economic growth than Switzerland. joining the EU Participation in trade in the European Economic Area, in particular, can be of great benefit to that country.
However, for reasons of financial strength above, The analysts therefore viewed If Switzerland joins the EU may destabilize such financial stability. due to the need to adjust the economic structure to meet the standards of countries in the EU
3. Regime differences
The main difference between Switzerland and the EU is The “regime” in Switzerland has a federal structure (A Federal Structure) that has been in use since the 1848 constitution.
At that time, The Swiss Federation differed from the rest of Europe in terms of its system of checks and balances, as well as its decentralization. (Decentralized Power)
for example The Swiss Federation at that time was subdivided into Canton, or subdivisions. Each canton is an independent entity, i.e. it has its own local constitution, government and police. The central government is only responsible for foreign policy, the military, and the development of infrastructure such as railways.
At the same time, federal agencies are given decision-making power only in the event of two Canton filings. Each decision must be made under a very strict framework.
on the contrary The regime of the EU countries is quite different from the framework of Switzerland. consisting of
1. Integrated centralized system (A Completely Centralized System) under a single government, such as in Italy and France.
2. federal structure (A Federal Structure) in which the central government has the power to make decisions in the part that is not governing the country. (Non-administrative Decisions) such as Germany
From the differences in the regime mentioned above. This is an important reason why the Swiss authorities and citizens have decided not to join the EU.
4. Direct democracy
Another point that distinguishes Switzerland from EU member states is its A direct democracy (Direct Democracy), that is, every citizen has 100% decision-making power, with the people able to approve or repeal the government’s laws immediately. through a referendum or signature hunting of the majority of citizens in each sub-government
Therefore, if Switzerland joins the EU under the current legal status of the association, This will directly result in a significant reduction in the level of democracy in Switzerland. Because every decision must be made directly to the central government alone.
5. The strength of the financial sector – banking
The final reason why the Swiss government and citizens do not want to join the EU is The country’s “strength of the financial-banking sector” is a result of the Swiss federal government’s high regard for the security and privacy of banking customer data.
together with tax laws that are ready to facilitate those who deposit their assets in the bank Including the surrounding mountainous terrain resulting in high security
The private banking industry in Switzerland It manages over $6.5 trillion in multinational assets (approximately 212 trillion baht), or one-fourth of all internationally-moved assets around the world.
In addition, many analysts agree that if gold is not counted government bond or dollars One of the safest and most low-risk assets is to keep your money in Swiss francs.
with the policy of keeping confidentiality of customers especially for high-net-worth bank customers As a result, should Switzerland become a member of the EU, it could reduce its customer confidentiality strengths. Because investors may question the issue of information transparency. and data sharing between EU countries.
Switzerland and relations with the EU
The BBC News Agency (BBC) provides information that in 1972, both Switzerland and the EU countries entered into a free trade agreement (Free Trade Agreement), but in the next 20 years, the Swiss government Switzerland has announced that it will not join the European Economic Area (EEA) with a preliminary vote.
However, in 2005, the two reached an agreement to open Europe’s Schengen Open Borders, allowing free transport from Switzerland to all New EU States. 10 states
The countries in the Schengen area include Netherlands, Belgium, Spain, Iceland, Italy, Austria, Greece, Latvia, Liechtenstein, Lithuania, Luxembourg, Malta, Norway, Portugal, Poland, France, Sweden. , Germany, Slovakia, Slovenia, Finland, Switzerland, Croatia, Denmark, Czech Republic, Hungary and Estonia.
In 2014, the government accepted fewer workers from EU countries. This resulted in a feud between the two parties. Finally, formal negotiations took place to strengthen relations under the framework of the treaty.
However, no matter how much time has passed Analysts are assessed in the same voice that “Switzerland remains one of the countries in Western Europe whose governments and citizens have no plans to join the EU. Mainly for reasons of independence of jurisdiction and democratic approach,” as well as other financial issues mentioned above.