Swiss Reject Ecopop Immigration Limits, SRF Projections Show

Nov. 30 (Bloomberg) — Swiss voters probably rejected a referendum to introduce strict immigration quotas, a step that would have risked choking off economic growth and souring foreign relations.

Voters turned down the initiative known as Ecopop, according to projections by Swiss television SRF at 12:30 p.m. local time today. The measure “Halt Overpopulation — Preserve the Natural Environment” would have limited annual immigration to just 0.2 percent of the country’s permanent resident population. Polls, including one by gfs.bern, forecast the initiative’s rejection.

Nearly a quarter of Switzerland’s 8.1 million people are foreigners. The many newcomers, whose numbers ballooned in the decade after Switzerland adopted the European Union’s free movement of persons, have led to complaints about a lack of affordable housing and overcrowded public transport.

“Immigration is high and that has provoked defensive reflexes,” said Michael Hermann, a senior lecturer at the University of Zurich. “It’s true that the country was more homogeneous and self-reflective decades ago — but these are changes that would’ve taken place anyway due to globalization.”

All of Switzerland’s major political parties were against the measure, which is significantly more stringent than “Stop Mass Immigration” referendum approved by voters in February. Immigration has proved a key support of economic growth, and the political parties argued Ecopop would prevent companies from hiring the skilled foreign workers they need and deal yet another blow to Switzerland’s already testy relations with the EU.

Contentious Topic

Immigration is a contentious topic in other countries as well. U.S. President Barack Obama this months gave a reprieve to undocumented immigrants, while British Prime Minister David Cameron has been at odds with his EU counterparts over his attempts to curb free movement of persons within the bloc and has promised to hold a referendum on the U.K.’s EU membership by 2017 if he wins the next national election.

Under Ecopop, a net 16,000 newcomers would’ve been permitted to enter Switzerland each year. Asylum-seekers, Swiss citizens’ foreign spouses or adopted children, and specialists in the pharmaceutical or in the banking sector could have been affected by the new restrictions.

While February’s “Mass Immigration” initiative, which isn’t affected by today’s Ecopop defeat, requires the enactment of quotas, it gives a three-year deadline and leaves it up to the government to set their level, taking the needs of businesses into account.

Geneva Watchmaking

Currently, there is no numerical upper limit for citizens of EU countries or on the husbands and wives of Swiss citizens. The government sets a quota on highly skilled workers from non- EU countries such as Canada, Japan or Australia each year.

Skilled immigrants have played a prominent role in Swiss business for hundreds of years. Geneva’s tradition of watchmaking traces its origins to the arrival of Huguenots in the 16th century, while in 1839 two Polish immigrants joined forces to form the forerunner of Patek Philippe. Similarly, German immigrant Heinrich Nestle founded Nestle SA, the maker of Nespresso coffee, and Beirut-born Nicolas Hayek was the force behind Swatch Group AG.

More recently, Philipp Hildebrand, once president of central bank and now a vice president at asset manager BlackRock Inc., pointed out that the national soccer team is comprised chiefly of players whose parents came from abroad, including Bayern Munich midfielder Xherdan Shaqiri. “This plurality of backgrounds and footballing cultures has unequivocally strengthened Switzerland’s contribution to world football,” he wrote in June.

Xenophobic and Dangerous

Proponents of Ecopop, which also would have required a tenth of the federal government’s foreign aid budget to be devoted to family planning, contended it would preserve the environment and quality of life. Opponents, including the government, called it xenophobic and ineffective.

“This initiative treats people as a problem,” Justice Minister Simonetta Sommaruga said last month, laying out her opposition to the measure. “Whether it intends to or not, it is xenophobic.”

Even Christoph Blocher, vice president of the Swiss People’s Party that spearheaded the February immigration vote, said Ecopop went too far. “Ecopop is dangerous and would hurt our country,” the former justice minister told the newspaper Tages-Anzeiger on Oct. 31.

Had it passed, the initiative would have caused a “significant loss” to potential growth, Credit Suisse economist Sara Carnazzi Weber said.

Economic Risks

According to David Marmet, economist at Zuercher Kantonalbank, the initiative would have been “bad news for companies, especially the construction sector.”

Landlocked Switzerland has declined to join the EU, and its relations with the 28-country bloc are governed by a series accords covering a range of topics such as border control, electricity markets, scientific research and the free movement of persons. They contain a “guillotine” clause that will nullify all, if one is struck down. The EU said earlier this year it won’t re-negotiate the immigration provision.

Among the business leaders who have warned of the risks Switzerland faces by approving Ecopop is Swiss Re AG Chairman Walter Kielholz.

“It’s a yearning for a country that never existed,” he told the newspaper Schweiz am Sonntag in an interview on Nov. 23, adding that the economy needed its tax and trade agreements. “Unfortunately, we’re in the process of questioning everything and sacrificing it to our mania for independence.”

Voters probably also rejected an initiative requiring the Swiss National Bank to hold a fixed portion of its assets in gold and one that would’ve abolished the tax privileges accorded to wealthy foreigners.

–With assistance from Albertina Torsoli in Geneva.

To contact the reporter on this story: Catherine Bosley in Zurich at [e-mail] To contact the editors responsible for this story: Fergal O’Brien at [e-mail] Zoe Schneeweiss, Kevin Costelloe