The Swiss economics minister has pushed for Switzerland to be much more active in emerging markets like Brazil and Chile on a trip to the region.This content was published on October 18, 2011 - 13:56
Johann Schneider-Ammann wrapped up an official visit to South America on Monday with a meeting with the Chilean economics and foreign ministers and a joint call to renew the 2004 free trade agreement between the European Free Trade Association (Efta) and Chile.
Earlier this week Schneider-Ammann thanked his Brazilian hosts for a number ten football shirt with “Johann” printed on the back and joked that Switzerland could maybe “send its young Swiss players to learn the art of football from the Brazilians”.
His remark came only a few hours after the signing of a work placement exchange accord with Brazilian Foreign Minister Antonio Patriota for graduates and discussions about the possibility of starting free trade talks.
Despite the light humour, his five-day visit had serious objectives: to boost economic ties with Brazil - Switzerland’s most important trading partner in Latin America - and Chile.
The Swiss also hoped to stimulate negotiations for a free trade agreement with Mercosur, the trade block of South American nations, similar to the one between Efta and Chile.
For members of the accompanying business delegation of many leading Swiss company and association executives, much more important than the exchange accord was getting a better understanding of the business reality on the ground.
During a meeting with Brazilian businessmen on Friday, organised by the Federation of Industries of the State of São Paulo, Schneider-Ammann said stronger business ties would help tackle the problem of the strong Swiss franc.
“In my meeting with four Brazilian ministers these past few days, I asked them to give fresh impetus to free trade talks between Efta and Mercosur,” he added.
He acknowledged that Brazil weighed up the importance of talks with Efta member states versus those with blocs like the European Union, but this was not an obstacle to an accord, he added.
“The discussions are mainly about assessing quality rather than quantity,” he told swissinfo.ch. “When I talk about Switzerland as an Efta country, I talk about us as the most innovative and competitive nation, qualities that Brazilian partners appreciate."
Last year the volume of trade between Switzerland and Brazil amounted to SFr3.2 billion ($3.5 billion), a 19 per cent increase on 2009.
However, some businessmen, like Benjamin Steinbruch, vice-president of the Federation of São Paulo Industries, believe this trade figure is too low.
Schneider-Ammann felt Switzerland had an opportunity: “Of course the potential is huge. I am convinced that via a free trade agreement - where unresolved issues such as tariff and non-tariff barriers and legal matters remain - interest in investments have increased, and in both directions not just one.”
This view is shared by businessmen like Jean-Daniel Pasche, head of the Federation of the Swiss Watch Industry, who was part of the delegation.
“Agreements on legal matters and free trade, like the ones signed with Chile, not only reduce export and import costs but also give firms more confidence to invest,” he told swissinfo.ch.
Most delegates agreed that trade accords signed with Chile, such as the protection of investments (2002), the Efta-Chile free trade agreement (2004), and double taxation (2010), made it an ideal platform for investment.
Since 2010 Chile is also the only South American nation belonging to the Organisation for Economic Co-operation and Development (OECD).
“It is very open country and promising for business,” said Daniel Kündig, president of the Swiss Association of Engineers and Architects.
He had received some tangible results from the visit. “The city of Valparaíso told us they wanted to renovate the Valparaíso funicular railway, which will cost SFr1 million. They want Swiss help and know-how,” he said.
In Chile Schneider-Ammann had meeting with Economics Minister Pablo Nogueira and Foreign Minister Alfredo Moreno.
The Swiss minister and delegation said Switzerland and Chile held similar positions on multilateral issues.
“Both countries share common visions in the G-20 meetings, and are looking for the best way of advancing negotiations, including in the Doha Round,” said Schneider-Ammann.
He underlined the quality of bilateral relations but suggested certain improvements.
“We have had a free trade agreement for a few years now, which is working very well. But we would like to go much further. In the area of services, for example, joint recognition of qualifications would allow Swiss people to work here and vice-versa,” he added.
In 2010 Brazil and Chile registered economic growth of 7.5% and 5.3% respectively.
Last year the volume of trade between Switzerland and Brazil amounted to SFr3.2 billion, a 19% increase on 2009. Exports totalled SFr2.3 billion and imports stood at SFr849 million.
In 2009, Swiss investments in Brazil rose to SFr12.8 billion and Swiss firms employed 106,000 staff.
In 2010, exports to Chile stood at SFr205.9 million and imports SFr149.5 million.
At the end of 2009, Swiss investments in Chile totalled SFr1.5 billion and Swiss firms employed 13,300 people.
During the visit from October 12-18, Swiss Economics Minister Johann Schneider-Ammann met Brazilian Vice-President Michel Termer, Economics Minister Fernando Pimentel, Foreign Minister Antonio Patriota and Science and Technology Minister Aloizio Mercadante.
In Chile he met President Sebastián Piñera, Economics Minister Pablo Longueira and Foreign Minister Alfredo Moreno.
Apart from official talks, Schneider-Ammann also held sessions with local economic business associations and Swiss firms in both countries. He is due to visit Swiss firms, including Clariant in Santiago.
In São Paulo the delegation attended a conference on exchange rate fluctuations, organised by the Swiss Business Hub and the Federation of Industries of the State of São Paulo (FIESP).
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