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Swiss start freeing up blocked EU payment to help thaw frosty ties By Reuters

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© Reuters. FILE PHOTO. The European Union flag and Switzerland’s flag can be seen in Brussels on April 23rd, 2021. Francois Walschaerts/Pool via REUTERS

ZURICH (Reuters) – Switzerland’s upper house of parliament on Thursday approved unblocking 1.3 billion Swiss francs ($1.41 billion) in payments to poorer European Union members in a bid to thaw frosty ties with its biggest trading partner.

As a gesture of goodwill, after many years of discussions to link Switzerland to the single market in May, the government would like to remove the “cohesion” payment. It was frozen during a 2019 dispute over mutual stock market recognition rules.

Talks were stalled by disagreements about a bilateral treaty, which critics claimed infringed too heavily on Swiss sovereignty.

Non-EU countries such as Norway or Switzerland are required to pay cohesion payments in order to be allowed into the single marketplace.

Brussels has been pressing for a treaty for over a decade to replace a collection of bilateral agreements and allow the Swiss to adopt new rules for single markets.

The treaty has now been canceled, preventing any further Swiss access to single market. This is crucial for an export-led Swiss economy. It also relegated Swiss-based researchers to the margins of the Horizon programme.

Right-wing Swiss People’s Party members opposed the authorization of the payment because they were unsure if the EU would ease its hardline on Swiss.

“Releasing the money alone does not guarantee that Switzerland can participate in Horizon, for instance,” foreign minister Ignazio Cassis (a Liberal) acknowledged during the discussion. That is the risk the government is willing to take.

On Thursday, the lower house would approve the measure.

($1 = 0.9239 Swiss francs)

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