Time flies when trade is growing rapidly; Indian Trade Minister Arnand Sharna at Baselworld 2011
BERN, SWITZERLAND – Trade between India and Switzerland, currently negotiating a bilateral free trade treaty, has grown at a “fulgerant” rate in the past 20 years, the Swiss Customs Office says. Exports from Switzerland to India grew by 18 percent in the first nine months of 2011 and have now crossed the threshold of CHF3 billion.
Swiss exports grew seven-fold from 1990 to 2010, from CHF378 million to nearly CHF2.6 billion. Imports from India grew during the same period from CHF251m to CHF901m. Trade with India has thus grown dramatically, but India remains Switzerland’s seventh trading partner, well behind China, with Swiss exports of CHF7.1b and Japan, with CHF6.43.
Chemicals account for main exports as well as imports: mainly pharmaceuticals for Swiss exports, with basic chemical products and finished ones sharing the imports from India about equally. Other Swiss exports: machines, particularly precision instruments, and electronics plus watches.
BERN, SWITZERLAND – Indian President Pratibha Devisingh Patil’s two-day visit to Switzerland that began Monday has already resulted in a number of initiatives, including a request by India for Switzerland’s support for an Indian seat on the UN Security Council as well as a fiscal agreement, and 11 new joint scientific research programmes.
Switzerland is the seventh most important importer of Indian goods and services, and trade between the two countries is CHF3.6 billion, with a 180 percent increase in the past decade. The trade surplus is CHF1.6b in Switzerland’s favour. Swiss exports to India rose by 21 percent in the first six months of 2011 while Indian exports to Switzerland rose by 31 percent.
Swiss direct investment in India in 2009, says the Swiss National Bank, was CHF3.3b.
The number of Indian tourists in Switzerland in 2009 rose by 21 percent.
This photo provided by the Convention's office in Geneva, shows Tuvalu's Prime Minister Willy Telavi during a meeting with Prince Mired of Jordan, an envoy of the Ottawa Convention
GENEVA, SWITZERLAND – The island nation of Tuvalu 13 September became the 157th nation to sign the Ottawa Convention, also known as the Anti-Personnel Mine Ban Convention.
It is the first new country to adhere to the convention since 2007, and its accession brings “near universal acceptance of this landmark treaty in the Pacific,” the Convention’s office in Geneva said in a statement Friday 22 September.
In the region, only the Marshall Islands, the Federated States of Micronesia and Tonga are not part of the ban.
According to the statement issued in Geneva, Finland, Poland and South Sudan could also join the Convention that prohibits the use, production, stockpile, and transfer of antipersonnel landmines.
The Convention entered into force in 1999 and today 153 of the 157 nations that have ratified or acceded to it no longer have stocks of landmines.
BERN, SWITZERLAND – The Foreign Affairs Committee of the Swiss upper house Monday 5 September rejected a new tax assistance treaty with the US, saying that it has been kept informed by Federal Councillor and Finance Minister Eveline Widmer-Schlumpf of discussions with the US over possible Swiss bank involvement in tax fraud cases.
The committee says a repeat of the treaty between the two countries over the case of UBS in 2008 is “not an option”, with that treaty based on emergency legislation. The US must respect existing Swiss law in settling differences over how the American government requests and obtains Swiss judiciary assistance in tax fraud cases.
A negotiated agreement to work out tax issues is the way forward, the committee insists.
Bank UBS paid the US $780 million to settle a case brought by the US Justice Department, which demanded data from 52,000 bank accounts. The Swiss government and tax authorities spent a year reviewing the US requests and agreed to hand over data on 4,450 accounts that met agreed criteria for likely tax fraud. Switzerland made a number of changes to its financial supervisory system and took steps to safeguard Swiss banking secrecy while agreeing to work more closely with other governments in the wake of the UBS crisis.
It was also under pressure from the OECD to bring its judicial assistance programme into line with OECD standards and in the past two years it has negotiated new tax treaties with more than a dozen countries, based on those standards. Among them were treaties announced in August, with the UK and Germany, that call for Switzerland to charge a withholding tax on foreign accounts without revealing the names of the account holders.
Background: “US versus Switzerland over bank details: new round opens”, 5 September, GenevaLunch
Odier praises recent agreements with UK, Germany and says US must respect existing Swiss law
Patrick Odier, left and Brady Dougan, head of Credit Suisse, in 2009
ZURICH, SWITZERLAND – Patrick Odier, president of the Swiss Bankers Association (SBA), says that a new Swiss treaty with the US, similar to the one negotiated for the transfer of banking data from UBS to the US but covering additional banks, would not be likely to be approved by parliament.
“The cross-border problems with the United States can and will be solved. But the United States must understand that Swiss laws must be respected,” Odier said at a news conference.
Odier’s remarks were made at a news conference in Zurich Monday morning 5 September in a run-up to the annual Swiss Bankers Day Tuesday 6 September.
He also emphasized that the new tax agreements negotiated with Germany and the UK point the way forward in resolving Switzerland’s tax and banking disputes with other countries, but also what the banking industry sees as its bigger challenge: they represent a milestone in implementing the 2015 Financial Centre Strategy set out by the association, one of the goals of which is acquiring and managing taxed assets.
“Bank client secrecy protects wealth and does not hide it. This protection remains important,” Odier insisted to journalists.
Swiss banks in 2010 had earnings of CHF61.5 billion, which the SBA attributes to a growing economy and low interest rates. Earnings were up by 13.4 per cent. Total assets rose by 1.7 per cent to a total of CHF2,714.5 billion. The total volume for mortgages and bank loans last year was CHF 898 billion. The majority of lending continued to go to private households, SBA figures show.
The organization is at odds with the federal government over keeping mortgage lending risks under control.
“The current upward price trend on the real estate market, with scattered hot spots, is due to low interest rates and rising demand. The banks are working with FINMA to find a solution that would strengthen certain aspects of the existing self-regulation for lending. The SBA was therefore surprised by the announcement made by the Swiss Federal Council to strengthen the capital adequacy requirements for the mortgage business. The SBA remains sceptical about the effectiveness of any quantitative regulations. In particular, even in the area of exceptions-to-policy, the SBA would expect to see risk-based capital adequacy requirements.”
The SBA says it is supports Swiss government efforts to seek “a sustainable solution to the open issues regarding the cross-border business with the United States. A solution must be applicable worldwide, definitive and correspond to existing Swiss law”, the group says in a statement issued Monday morning.
Reuters reports that “a long tradition of bank secrecy has helped Switzerland build up a $2 trillion offshore financial industry, but the country has agreed in recent years to do more to help hunt tax cheats amid a global crackdown on tax havens. The government is keen to find a solution that would avoid needing the approval of parliament which only reluctantly agreed to the UBS treaty under emergency law last year.”
Ayat Suliman’s brother brought an unexploded cluster munition into their house in Samarra, Iraq. The munition exploded and caused burns to form over 65% of Ayat’s body. In Iraq, the United States used at least 1,206 clusters, containing more than 200,000 submunitions; this number represents 4 percent of the total number of air-delivered weapons used by the Coalition (text, image: Magnus Fröderberg for Cluster Munitions Coalition)
BERN, SWITZERLAND – The Swiss government Monday 6 June agreed, as expected, to ratify the 2008 Convention on Cluster Munitions (CCM). It signed the treaty in Dublin in 2008, along with 106 other countries, but needed to take the convention through several stages before ratification.
A key step was the revision of Switzerland’s war material act of 1996 to add penal provisions. “This act will be complemented by a ban on cluster munitions,” the Swiss Federal Council said in a statement.
“There will also be a ban on the financing of prohibited war material. Such material already includes nuclear weapons, biological and capital weapons and antipersonnel mines. Now cluster munitions will be added to the list.”
Ratification would force banks to completely dis-invest in cluster munitions companies
The move comes 10 days after a report issued by Handicap International drew attention to what it called the “Hall of Shame” of banks that invest in companies which produce cluster munitions. The two large Swiss banks, UBS and Credit Suisse, figured on the list, along with 14 other Swiss financial institutions. Both vehemently denied that they finance cluster munitions, pointing out that many of the investments listed were made before they tightened their policies in 2010 to avoid future investments in the large conglomerates which are often behind the manufacturers.
The report says, based on publicly available information, that 166 financial institutions in 15 countries have financial interests in eight companies that produce cluster munitions.
Handicap International says progress has been made in the financing area, but far more needs to be done.
Switzerland spends CHF16 billion a year on demining
Geneva, Switzerland (GenevaLunch) – US President Barack Obama Wednesday 2 February signed the Start treaty with Russia, following approval by Congress. Obama and Russian President Dmitry Medvedev initialled the treaty in Prague in April 2010, but it required US Senate ratification.
The treaty will come into force 5 February when the two countries’ heads of foreign affairs, who kicked off talks for the new treaty in Geneva in March 2009, meet. US Secretary of State Hillary Clinton and Russian Foreign Minister Sergei Lavrov will exchange the instruments of ratification in Munich, during the Munich Security Conference.
The terms of the treaty have been negotiated mainly in Geneva and the US Mission said Thursday morning that the implementation meetings will take place in Geneva, but mentioned no date.
Landmine survivors, El Salvador: Central America is now free of landmines, but Ottawa Convention countries agree to help survivors, not just rid their countries of mines
Geneva, Switzerland (GenevaLunch) – Central America has become landmine-free, thanks to the elimination of all known landmines in Nicaragua, two representatives of its government told a working session of the Anti-Personnel Mine Ban Convention Tuesday 22 June. “After two decades of work, Nicaragua is proud to announce that we have completed clearance of all known anti-personnel mines in our territory, and that all contaminated areas have been deemed safe for normal activity. The last mine was removed and destroyed on 13 April 2010,” the government’s statement notes. Colonel Spiro Bassi of the Nicaraguan Army Corps of Engineering and Juan Umana Loaisiga from the Ministry of Defense addressed the Geneva meeting.
The Convention is also known as the Ottawa Treaty.
The country removed more than 179,000 landmines, planted during its civil war in the 1980s. Nicaragua has 1,200 landmine survivors today.
The country, which signed the convention in 1997, undertook the largest demining operation in Central America. The original estimate in 1997 of 135,000 mines grew over the years as more areas with mines were discovered. Anti-personnel mines were found in 16 out of 17 regions in the country, affecting rural communities and severely impoverished areas.
Lower house of Parliament insists on referendum, motion now goes to commission
Bern, Switzerland (GenevaLunch) – The lower house of the Swiss parliament Wednesday afternoon repeated its earlier vote in favour of a popular referendum on the Swiss-US treaty covering possibly fraudulent use of some UBS bank accounts.
The upper house earlier in the day refused to consider taking the treaty to the Swiss population. The motion now goes to a special commission that meets Thursday to try to find a political compromise.
The treaty, agreed to by the ruling seven-member Swiss Federal Council, has fallen victim to political negotiations over taxing bank bonuses and related banking issues.
Cliff-hanger continues over treaty as lower house says yes – but with option to put vote to national referendum
Bern, Switzerland (GenevaLunch) – The right-wing UDC party held to its promise and supported the US-Swiss treaty covering a US request for judicial assistance for 4,450 UBS bank accounts. The treaty passed, 81 in favour, 61 against – with 54 abstaining, mainly UDC members. The vote in favour comes with a rider, however, that the option for a popular vote on the treaty should be exercised, forcing the two houses to now work out a compromise solution there. A popular vote would prevent Switzerland from meeting the treaty obligation to review all 4,450 accounts for the US by 31 August 2010.
Bern, Switzerland (GenevaLunch) – The outcome of the Swiss-US treaty covering 4,450 UBS bank accounts is unlikely to be decided before Monday or Tuesday, 15-16 June, following a recommendation from a lower house of Parliament commission to reject the treaty or to add a clause to the parliamentary project requiring a popular referendum vote on it. The lower house economic commission, which recommends action to the house as a whole, voted 14-12 Thursday morning against accepting the treaty.
A popular vote, which would take time to organize, would jeopardize the treaty, which requires Switzerland to act on the US request for judicial assistance by completing its review of the 4,450 cases and delivering information on the accounts by the end of August 2010.
Update 16:35 Bern, Switzerland (GenevaLunch) - The upper house of the Swiss parliament Thursday voted 31-11 in favour of the agreement between the US and Switzerland that will allow the Swiss to provide judicial assistance for 4,450 UBS bank account holders. The vote moves the treaty a step closer to approval: the lower house votes Monday. A yes vote faces a tougher time there.
The upper house (Conseil des Etats) vote is retroactive and applies to the specific cases where requests have been made. It does not apply to future requests, which would require legislative changes. The upper house also voted against putting the treaty to a popular vote and it refused to debate the government’s plans to put in place regulations for “too big to fail” banks.
Background, GenevaLunch
Links to other sites (Fre): Le Temps, RSR, Tribune de Geneve
Bern, Switzerland (GenevaLunch) - The Swiss Federal Council Wednesday afternoon 14 April formally asked Parliament to approve the treaty signed with the United States in August 2009. The treaty is an agreement whereby Switzerland will provide judicial assistance to the IRS, the US tax authority in the case of 4,450 UBS clients suspected of tax fraud.
The message goes to Parliament as the country’s left and centre political parties appear to be lining up to approve the treaty, although the right-wing People’s Party insists that it flies in the face of Swiss banking secrecy law.
© Chappatte, distributed by Globe Cartoon. More cartoons on Chappatte’s web site. Geneva-based Patrick Chappatte works for the International Herald Tribune, for Geneva newspaper Le Temps, and for NZZ am Sonntag. All cartoons reproduced with permission.
Update 18:15 Geneva, Switzerland (GenevaLunch) – US President Barack Obama and Russian President Dmitry Medvedev will meet in Prague, Czech Republic Thursday 8 April to sign a new Start treaty, bringing to an end months-long negotiations to reduce strategic arms. The US Senate and Russian Parliament will need to ratify the treaty.
The two presidents agreed to the meeting Friday morning 26 March, in the 13th phone call they have had over the Start talks. The terms of the new agreement will reduce arms stockpiles considerably, according to the White House announcement:
Navi Pillay, UN High Commissioner for Human Rights
Geneva, Switzerland (GenevaLunch) - Navi Pillay, UN High Commissioner for Human Rights, has issued a call to abolish the death sentence, as a new US report shows that its use is decreasing there and that several states are considering ending its use. The 20th anniversary of the international death penalty treaty was marked by Pillay’s appeal in Geneva. The treaty calls for the universal abolition of capital punishment. Pillay’s office says that 140 countries no longer carry out the death penalty, and 72 countries have ratified the treaty’s Optional Protocol, which bars the death penalty.
The Death Penalty Information Center (DPIC), a monitoring group in Washington, DC in the US, shows in its annual report that 106 death sentences were issued in the US in 2009, down from a post-1976 high of 328 in 1994.
Update 2 18:55 Geneva, Switzerland (GenevaLunch) – US President Barack Obama and Russian President Dmitry Medvedev late Friday 4 December issued this joint statement after a week of high-level negotiations in Geneva:
“Recognizing our mutual determination to support strategic stability between the United States of America and the Russian Federation, we express our commitment, as a matter of principle, to continue to work together in the spirit of the Start Treaty following its expiration, as well as our firm intention to ensure that a new treaty on strategic arms enter into force at the earliest possible date.”
The treaty officially expires Saturday 5 December 2009. The two countries have said in recent weeks that while they were working towards completing a draft for a new treaty by the time the old one ends, it would more likely be the end of 2009 before a draft could be ready. The new statement avoids setting a deadline, but reinforces the commitment of both sides.
A spokesperson for the US Mission in Geneva said that “The US and Russia are continuing to work hard to complete the new Start Treaty and our delegations are making significant progress toward that end, nonetheless, some difficult issues remain.”
Geneva, Switzerland (GenevaLunch) - Russia and the US are close to signing a new treaty to replace the Strategic Arms Reduction Treaty (Start), which expires Saturday 5 December, Russian news agency Ria Novosti reports late Friday, although it is unlikely the pact will be signed before the end of the year. The agency sites Russian military sources and says the two sides will meet again Saturday in Geneva. According to Ria Novosti, “The chief of the Russian General Staff said earlier that the ongoing talks had run into disagreements on inspection and verification procedures.”
Geneva, Switzerland (GenevaLunch) - The United States heads into the Cartagena Summit, which opens Sunday 29 November in Colombia, now saying that it is continuing to review its policy on signing the international Mine Ban treaty. The US is sending a sizeable official observer team to the summit, with groups from the State Department, Pentagon, US Agency for International Development and the Centers for Disease Control and Prevention.
The Cartagena Summit is the second review of the 1997 Ottawa Convention that bans the use, stockpiling, production and transfer of antipersonnel mines. More than 1,000 delegates, including several heads of state, will participate in the summit, which will assess progress made in clearing the world of landmines.
Cause of US shift unexplained
The US said in a statement issued Wednesday 25 November that it is still reviewing its position on signing the 10-year-old Mine Ban treaty – the opposite of what it said the previous day, but it was unclear if the statement was a correction of an error, a change in tactics ahead of the Cartagena Summit that opens 29 November in Colombia, or a change of heart following harsh criticism.
US to be observer only at Cartagena summit
Demining demonstration in Tirana (photo: Cartagena Summit)
Geneva, Switzerland (GenevaLunch) – The United States will be attending the Cartagena Summit on a Mine-free World in Colombia 30 November as an observer only, following a review and recent decision not to sign the landmine treaty, US State Department spokesperson Ian Kelly said at a daily briefing in Washington Tuesday 24 November. The summit is the Second Review Conference of the Ottawa Convention, informally known as the landmines ban treaty. CNN reports that the decision comes as a surprise to observers who believed the US has been considering joining the 156 other nations who have signed the treaty, citing Human Rights Watch’s reaction. The decision also dashes hopes of the Geneva-based Cartagena Summit secretariat that the US would soon be a party to the treaty.
The official name of the treaty is the Convention on the Prohibition of the Use, Stockpiling, Production and Transfer of Antipersonnel Mines and on Their Destruction. It’s also often referred to as the AP (anti-personnel) Mine Ban Convention. It entered into force in 1999. China and Russia are the only other major powers not to have signed the convention.
Not in interests of US defense needs
Kelly’s response when asked why the US is not signing the treaty was that “we made our policy review and we determined that we would not be able to meet our national defense needs, nor our security commitments to our friends and allies if we sign this convention.”
What landmines do: an eloquent image
Geneva, Switzerland (GenevaLunch) – Good progress has been made in reducing the number of landmines throughout the world, but much more work remains to be done, with 70 countries still having mines or explosive remnants of war, concludes the Landmine Monitor Report 2009: Toward a Mine-Free World, an annual report published Thursday 12 November by the International Campaign to Ban Landmines. This year’s report includes a 10-year summary since the reports began in 1999. The group is the research and monitoring programme of the Nobel Peace Prize-winning International Campaign to Ban Landmines.
Eighty percent of the world’s countries are party to the treaty but the report notes that “Thirty-nine countries—including China, India, Pakistan, Russia, and the United States—have yet to join the treaty, but most are in de facto compliance with many of the treaty’s key provisions. In recent years, Myanmar and Russia are the only states using antipersonnel mines. Use by non-state armed groups decreased from a high of 19 countries in 2001 to seven countries in 2008.”
Bern, Switzerland (GenevaLunch) – The Swiss government has suspended its 20 August 2009 agreement with Libya designed to improve relations and is restricting visas issued to Libyans. The Federal Council (cabinet) noted in a press release Wednesday 4 November that Tripoli has refused all collaboration and that “the two Swiss citizens, who were taken in violation of international law, are still being held in an unknown area. The Libyan authorities refuse to allow anyone to visit them.”
Bern, Switzerland (GenevaLunch) – Federal Councillor Ueli Maurer, head of the Swiss Federal Department of Defense, Civil Protection and Sport, DDPS, and the German ambassador to Bern, Axel Berg, signed a new treaty governing military service of dual-nationals from both countries. Dual-nationals are obliged to do their military service only in one country and can choose which country, although normally they will be expected to do so in their country of residence.
The treaty foresees that service requirements comprise actual military service or a military tax. Since Switzerland does not recognize civil defence service as a legal alternative to military service, completing this in Germany would not be recognized. Switzerland has treaties of this kind with France, Italy and Austria already.
Eveline Widmer-Schlumpf, Swiss minister for justice and police, press conference on UBS settlement
Update 4 23:15, Update 3 16:40, Update 2 16:27, Update 1 16:12
Ed. note: UBS shares dipped slightly during the afternoon, but began to rise slowly on the Swiss stock market during the press conference. In related news, Doug Shulman, the US Commissioner of Internal Revenue, who led comments by the US on the UBS case, took up his duties as the new chair of the OECD Forum on Tax Administration 18 August.
Bern and Zurich, Switzerland (GenevaLunch) - The seven members of the Swiss Federal Council (cabinet) Wednesday afternoon 19 August gave a press conference on the settlement in the UBS case. The government issued the following statement:
UBS New York headquarters
Update 2 Florida, USA; Bern and Zurich, Switzerland (GenevaLunch) – The bell hasn’t yet quite tolled for anyone in the US court case where the IRS is asking for names of UBS bank clients. Judge Alan Gold in Miami late Friday 7 August, Swiss time, gave the two governments another week, until 12 August and at their request, to hammer out details of an out of court settlement.
Reactions were mixed, with the Financial Times reporting that “Friday’s setback caused confusion” for investors, arguing that the “failure” to reach an agreement will hurt UBS shares. Swiss media were more phlegmatic, viewing the delay as an acceptance that a resolution of several technical issues requires more time, which the judge has given.
