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The Swiss Get a Reality Check but at least the trains still run on time
John and Silvia Andrews

High up in the mountain villages of Switzerland, change comes slowly.
Villagers will soon be preparing for the winter, bringing the cows down From the high pastures, stockpiling row after row of neatly chopped wood.
Just like last year; just like every year. But down in the valleys, a strange wind is gradually gaining strength, a foreign wind....and borne on this wind are the first small seeds of change.

It didn't start with the events of September 11th, although those Shockwaves rumbled effortlessly past the carefully guarded borders - more political and psychological than physical - and into the towns. For a long time, Switzerland was seen as a safe haven in times of trouble. Economically speaking, money tended to flow into the Swiss Franc and the stock market, both of which were seen as being stable and resistant to the turmoil that affected more volatile nations (including America and Britain). This time, it has been different. At first, there was a knee-jerk reaction as investors scrambled to pour their money into anything Swiss; but then a reaction set in and, like a tide, the flow stopped and then reversed direction.
Swiss markets suffered just like all the others.

Adding to what would anyway have been sizeable woes were the troubles Of what used to be known as Swissair, an affair routinely described by the Swiss media as a debacle. Swissair went bankrupt, its balance sheet Having plunged faster than a skier on one of the country's famous black runs.

The plug was first pulled by its leading banker, UBS, who then took part in A bailout between the state, the leading banks, and a collection of Supportive businesses. Swissair had generally been felt to have been punching above its weight, trying to support a world class airline from a country with roughly the population of Scotland. Switzerland's non-membership of the EU hampered the airline from forming partnerships with Europe's premier carriers, and so it embarked on a policy of taking sizeable stakes in lower-tier companies.
These investments proved costly in more than one sense - the balance Sheet was weakened, and its reputation for top class standards took a bad knock. The general malaise that, post-September, affected all airlines could not have come at a worse time for Swissair, and probably was responsible for providing the knockout punch. The end was dramatic: credit was cut off, stranding aeroplanes full of unbelieving passengers in various locations.
The embarrassing reality was that Swissair didn't have enough money to Pay for the fuel to fly the planes home. The national airline of one of the world's richest countries had run out of cash.
Unthinkable! cried the headlines in the local and national newspapers.

UBS, initially seen as the villain of the piece, found the world to be an unforgiving place, as hordes of unhappy customers - including, by all accounts, a healthy chunk of the Swissair staff, who also protested noisily outside the bank's fortress-like head office - expressed their dismay by using the one weapon the Swiss have in spades: their bank accounts.

Money flooded out of UBS, mostly to the benefit of the country's small Regional banks. Unthinkable? For many of the populace, for whom the words "business" and "failure" seldom appear in the same sentence, yes; although the shock was perhaps not so great in the financial community. After all, UBS itself was in such poor shape a couple of years ago that, in order to survive, it was forced into a merger with arch rivals SBC. Merger, in this instance, can loosely be translated as takeover. The newly combined bank, whilst retaining the UBS name, became to all intents and purposes an SBC controlled entity. A rose by any other name.

What shocked everybody - the waves carrying far, far beyond the borders Of this island-like, landlocked state - what really was unthinkable happened in the small and highly prosperous lakeside town of Zug, when a disgruntled former policeman walked into the local parliament building and shot dead fourteen people before turning the gun on himself. For those of us in the UK, accustomed to hearing and seeing acts of extreme violence in Northern Ireland and even the mainland, it is hard to imagine the shock that This terrible killing brought about. The local police chief pointed out that, until then, there hadn't been any murders in Zug that year; nor the year before that, for that matter. Not one. Not only was it the worst crime of its kind ever seen in the country - it was the only crime of its kind.
This simply doesn't happen in Switzerland.

Or rather - it does now. The unpleasant facts of life - plunging stock markets, bankrupt businesses, mass murder - that, for so long, have been seen by the Swiss as being the unfortunate lot of other countries, have succeeded in breaking down the barriers that the country has so proudly and steadfastly defended. Perhaps aware that a sea-change was under way, the Swiss peeped their heads above the parapet and voted - but only just - to join the United Nations. Whether this really is the start of a new Switzerland, whether a country is emerging that wants to fully engage With its European neighbours and the rest of the world, remains to be seen.

The Swiss, whether doctors in the towns or shepherds in the mountains, have traditionally been wary of the outside world; but now the outside world has come to Switzerland. The almost palpable fear in this proudly independent state is that it might never go away.

© John and Silvia Andrews - October 2002

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