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Crypto affair prompts tensions between Switzerland and Sweden

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This year marks a century of diplomatic ties between Switzerland and Sweden. © Keystone / Peter Klaunzer

The fallout from the affair, which broke in February this year, is directly behind Stockholm’s recent decision to cancel an official dinner, a media report claims.

According to the SonntagsBlick, the Swiss and Swedish foreign ministers were both set to attend a function in October marking 100 years of diplomatic ties. This week, however, Stockholm cancelled the event.

Citing “well-informed” sources, the newspaper claims this decision was taken in direct reprisal for the Swiss move to suspend the export licence of Crypto International AG, a Swedish-owned cybersecurity company based in Zug.

The Swiss government’s decision to suspend the licence came after media reports in February revealed that the Crypto AG company – a predecessor firm of Crypto International – was at the heart of a huge spying operation since the 1970s.

According to the reports, the encryption company, which sold its products to governments around the world, was used by the CIA and the West German intelligence services for decades to listen in on global communications.

Crypto International AG, who always denied having any connection to the company it took over in 2018, has since scaled back its Swiss operations and cut 80 jobs, largely as a result of the export ban.

According to the SonntagsBlick, Stockholm’s anger is not merely about the business fate of one of its companies; it’s also because Swedish authorities can no longer procure necessary equipment from the Zug-based firm.

Contacted by the newspaper, the Swiss foreign ministry confirmed the cancellation of the October 15 function, but did not comment on the reason.

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SWI - a branch of Swiss Broadcasting Corporation SRG SSR

SWI - a branch of Swiss Broadcasting Corporation SRG SSR