Deiss visit tests Swiss-Russian relations

Deiss wants to improve mutual economic ties in Moscow Keystone

Economic relations between Switzerland and Russia are blooming, but Economics Minister Joseph Deiss still expects a cool reception in Moscow on Thursday.

This content was published on October 19, 2005 - 09:00

The status of Yevgeny Adamov, the Russian former nuclear energy minister currently held in a Swiss jail, is a black cloud over Swiss-Russian relations.

Russia, as trade representatives never fail to remind us, is a country with great potential. Thanks to the high price of oil the economy is booming and incomes are rising.

The Swiss economy is one trading partner which benefits, but doing business with Russia can be fraught with political challenges, as Deiss is likely to see first hand during his two-day trip to Moscow on October 20-21.

Surprise and displeasure

Two weeks ago the Russian foreign ministry summoned the number two at the Swiss embassy in Moscow and expressed "surprise and displeasure" at Switzerland's decision to extradite Adamov to the United States.

Russia had also filed an extradition request – seeking Adamov on fraud charges - but this was turned down by the Swiss, prompting Russian accusations that the decision was politically motivated.

Adamov is charged by the US with embezzling funds that had been destined for nuclear-safety upgrades in Russia.

Export potential

In addition to the Adamov affair, the Russians are still embittered with the Swiss over the Überlingen plane crash.

In 2002 a Russian passenger plane and a cargo jet collided over southern Germany in Swiss-controlled airspace, killing all 71 of the mainly Russian passengers. Most were children.

Compensation to the victims' relatives was paid out in July 2004. However, there were criticisms from Russia that the move had taken too long.

But while political tensions since the plane crash have never really eased, economic relations are continuing to go from strength to strength.

In 2000 Russia bought SFr555 million ($425 million) worth of Swiss goods and services. By 2004 Swiss exports to Russia were worth SFr1.2 billion.

Swiss exporters see Russia as a great potential market, and indeed the primary purpose of Deiss's visit is to strengthen trade and economic ties.

Deiss is set to hold discussions with the Russian minister for economy and development, the finance minister, and the head of the Russian central bank. He will also inaugurate a Swiss-Russian economic forum.

Unhealthy involvement

Although the visit is fundamentally economic, the way in which Deiss is received in Moscow will reflect the current state of Swiss-Russian relations. In Russia, economics and politics are closely linked.

Despite the increasing influence of the Russian authorities on the country's economy, it is unlikely that Swiss entrepreneurs will experience targeted sanctions as a result of the Adamov affair.

At a conference in Moscow last week, representatives from big business criticised a development that the World Bank had already described as alarming last year.

They said state organisations and especially high-ranking officials are involved in business to a high degree and exploit their position to get rid of any competition.

swissinfo, Alexandra Stark in Moscow

Key facts

The most recent visit by a Swiss economic minister to Russia was Pascal Couchepin in 2001.
In recent years Russia, which has a population of 144 million, has seen an average growth in its GDP of 7%.

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In brief

Economics Minister Joseph Deiss is holding high-level economic talks in Moscow on October 20-21.

Deiss is set to meet the Russian minister for economy and development, the finance minister and the head of the Russian central bank – in addition to representatives from various regions.

Relations between Switzerland and Russia are tense following the Swiss decision to deliver Yevgeny Adamov, the Russian former nuclear energy minister, to the US.

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