Switzerland and Italy have agreed to step up legal cooperation over cigarette smuggling, during a meeting in Berne between the Italian prime minister, Giuliano Amato, and the Swiss president, Adolf Ogi.
The agreement comes after the Italian finance minister, Ottaviano Del Turco, accused Switzerland of failing to support Italy's efforts to crack down on smugglers. His comments, in August, soured diplomatic relations between the two countries.
However, Ogi's deputy spokesman was quick to play down suggestions about the state of bilateral relations by saying: "It was a big issue in the media. They weren't damaged at all".
After his meeting with Ogi on Tuesday, Amato said Switzerland and Italy enjoyed "excellent relations" and he was sure the "misunderstanding" could soon be resolved.
Ogi said Switzerland did not tolerate smuggling and that both countries should work more closely together to combat it.
Ogi's spokesman told swissinfo about whether there would be further talks on cigarette smuggling: "The issue was discussed very frankly. Both sides agreed that the finance and eceonomics ministers will meet in Berne or Rome to discuss the details."
The issue came to a head after the arrest in Switzerland of the suspected head of a Mafia smuggling ring, Gerardo Cuomo. Several Swiss are among 80 people named by judicial authorities for their involvement in the affair.
The talks in Berne also focused on the question of tax evasion. Switzerland is under pressure from the European Union to disclose the identity of EU citizens with assets in the country.
Switzerland has refused to budge on the issue, saying its banking secrecy laws are not up for negotiation.
swissinfo with agencies