Contents
Switzerland committed to the “New Silk Road” in 2019. But: What did this bring to Switzerland?
Around 10 years ago, China launched the “New Silk Road” project, also known as the “Belt and Road Initiative”. The major project is about creating new trade routes or expanding existing ones.
Switzerland committed to the new Silk Road in 2019. At that time she signed a declaration of intent, a so-called “Memorandum of Understanding”. But: What has the “New Silk Road” brought to Switzerland?
Legend: Did the “Memorandum of Understanding” bring disillusionment or is it a seal of quality for the Swiss economy? REUTERS/Tingshu Wang
If you ask about the benefits of the “New Silk Road” for the Swiss economy so far, Rudolf Minsch, the chief economist of the economic umbrella organization Economiesuisse, comes to a sobering conclusion: “Swiss companies were hardly involved. The projects were planned, financed and built by the Chinese side.
The Chinese have a lot of experience in large-scale projects. We don’t have these skills.
The chief economist of the economic umbrella organization Economiesuisse is not alone with this assessment. The memorandum also had little effect on the then Swiss ambassador to China, Bernardino Regazzoni.
In the declaration of intent, Switzerland and China spoke out in favor of closer cooperation on the “New Silk Road”. The goal: Swiss companies should be able to participate in projects more easily. However, it was not expected that this would immediately bring more orders to the Swiss economy, said Minsch. Because it is difficult for Swiss companies to take part in the gigantic infrastructure projects. The Chinese have a lot of experience. “We don’t have these skills on this scale.”
Important political signal for China
In addition, the competition is often not entirely fair: “It is an open secret that many projects are virtually cross-subsidized by China and that the providers can therefore offer such low prices that Swiss companies cannot keep up,” says Minsch.
The results of the new Silk Road for Switzerland have so far been modest. The former ambassador, Bernardino Regazzoni, even says that, looking back, the “Memorandum of Understanding” primarily benefited China. “Showing that an important European economic partner is on board is a good political result for China.”
The memorandum is a seal of quality that we can be trusted.
This statement is all the more explosive because the “New Silk Road” has a strong geopolitical component. Or to put it another way: It also serves China to expand its influence in the world. So you gave China a lot and got nothing in return? No, says Martin Hirzel, President of Swissmem, the association of the Swiss mechanical, electrical and metal industries. The declaration of intent is certainly useful: “Even if the signing of this memorandum was only symbolic, then it is still a door opener for Swiss industrial companies. It’s a seal of quality that we can be trusted.”
And Economiesuisse chief economist Rudolf Minsch also says: In the longer term, the “New Silk Road” could definitely bring something to Switzerland. The project leads to more trade and thus more growth in the countries involved: “This should in turn have positive effects on the demand for Swiss products and services. But a few more years will pass.” It remains to be seen whether this hope will come true – and whether the benefits for Switzerland and China will be balanced in the long term.