Local armaments may not be delivered to Ukraine, even indirectly. The industry doesn’t like that at all.
Exports from the Swiss armaments industry rose by 30 percent last year to a record CHF 955 million. But the Swiss gunsmiths could not keep up with the international competition.
This is partly due to the War Material Act. It prohibits direct deliveries to countries at war – and accordingly also to Ukraine and its allies.
But the law is coming under increasing pressure as criticism from numerous European capitals grows ever louder. The tenor was that Switzerland should finally allow the re-export of war material.
Switzerland as a business location and the credibility of our country have suffered massively.
Stefan Brupbacher is at the forefront of lobbying for a relaxation of the ban. The President of the Swissmem industry association has sharply criticized Switzerland’s understanding of neutrality. “Switzerland as a location and the credibility of our country have suffered massively,” he says.
The reason for this is “this highly misguided discussion of what neutrality means”. And that has nothing to do with neutrality, says Brupbacher.
Investments postponed for the time being
In fact, Switzerland has lost its attractiveness as an armaments location. An example of this is Rheinmetall. The German weapon manufacturer develops modern defense systems. Not so long ago, the company wanted to expand production in Zurich.
But things turned out differently. On request, the armaments group writes: Before you know what political support Rheinmetall will enjoy in the future, the company must first put its expansion plans on hold. The biggest problem: the legal interpretation when exporting.
Ruag also sees a “big problem”
One house down the same picture: Ruag writes that the uncertainty surrounding re-export is a major problem for the company.
In fact, a deal with Rheinmetall just recently failed. The German armaments group expressed interest in 96 Leopard 1 tanks from old Ruag stocks with the aim of refurbishing them and delivering them to Ukraine.
But the State Secretariat for Economic Affairs Seco did not allow the deal. This seems to confirm the assumption that Switzerland has lost reliability in arms deals from the point of view of its trading partners.
“Customers in the supply industry – that’s where many inventions and innovations are made – are increasingly asking themselves whether deliveries can still be made from Switzerland,” says Swissmem director Brupbacher.
Politicians will have to decide what they want
But those who cannot deliver will be ignored. And if the production of war material is only financially worthwhile thanks to demand from abroad, as is the case with the supplier companies, this has serious consequences.
Because in a world with complex and vulnerable supply chains and a war in the middle of Europe, one’s own defense industry is becoming increasingly important.
Amos Dossi from the Center for Security Studies at ETH Zurich writes on request: Politicians will soon have to decide which sales opportunities and thus development perspectives they want to grant to domestic armaments or supplier companies. Ukraine war or not.