Sino-Swiss ties have surged to new heights, says Swiss Ambassador to China

Jean-Jacques de Dardel, Swiss Ambassador to China. Photo: Courtesy of the Switzerland Embassy in China

Editor’s Note:

Chinese President Xi Jinping is on a state visit to Switzerland, during which he met Swiss President Doris Leuthard, consolidating an already close partnership. Xi will also attend the World Economic Forum (WEF) in Davos for the first time.

The Global Times (GT) reporter Zhang Xin interviewed the Swiss Ambassador to China Jean-Jacques de Dardel, who talks about the further deepening bilateral cooperations and China’s important role in the world economy.

GT: This is the first time President Xi visits Switzerland. And President Leuthard has just taken office. What does the meeting of the two mean?

De Dardel : President Leuthard and President Xi were set to hold official talks discussing bilateral as well as global topics, touching upon various fields of our broad bilateral ties. The development of China-Switzerland relations has gained a sound momentum. The meetings of the two presidents, as well as the ones with other ministers, will allow us to further deepen and diversify the cooperation between our two countries. I am confident that both countries are willing to work with each other to enrich the Innovative Strategic Partnership between China and Switzerland, and to lift the bilateral relations to a higher level.

GT: China and Switzerland declared the establishment of an “Innovative Strategic Partnership” in April 2016. In what ways has it shaped and accelerated the bilateral relationship so far?

De Dardel: China and Switzerland have maintained a diverse and in-depth bilateral relationship in a variety of areas, such as politics, the economy, culture as well as science for 66 years. Following former Swiss president Johann Schneider-Ammann’s visit to China in April 2016, Sino-Swiss relations have surged to new heights vivified by both countries’ Innovative Strategic Partnership – the first to date and unique. The partnership will usher in new collaboration opportunities through the application of “practical innovation” unique to Switzerland. As creative partners, both countries will explore innovative ways to further ties to mutually beneficial ends. As such, the Innovative Strategic Partnership by no means merely depicts innovation in the narrow sense of science and technology; rather, it recognizes the diversity, intensity and significance of the Sino-Swiss bilateral ties.

GT: China is recognized as a market economy by Switzerland, but within the European Union, there are debates about whether China deserves the recognition. What’s your take on China’s economic reform? How has Switzerland benefited from its economic ties with China?

De Dardel: Considering the progress that was made on the economic front and the longstanding strength of Sino-Swiss relations, it should not come as a surprise that compared to other advanced economies Switzerland granted China market economy status at a relatively early stage. China is a country with a huge population, which has been developing very dynamically in the past 30 years. It is admirable how the leadership has managed to keep this large supertanker steady through various challenging times. Now, facing lower growth rates, China is embarking on a new round of market-based reform. This choice by the Chinese leadership seems to be very sensible in achieving the goal of shifting the Chinese growth model from quantity to quality. The focus on a sustainable development and on strengthening the rule of law seems particularly pertinent in the context of the reform agenda.

Switzerland is the world’s 19th economy and China is the second. That means we are an important economic partner for many. Switzerland was in 2016 the 10th supplier of China worldwide and the second in Europe. Since 2010, China has been Switzerland’s third most important trading partner after the US and the EU. Usually it is China has a large amount of export. But our products are of such quality and our economies are so complementary that we traditionally have a large trade surplus with China. The Free Trade Agreement which entered into force in July 2014 is opening countless windows of opportunities in know-how exchange, investment, technology transfer, research and education, innovation, culture, and business creation.

GT: This visit will see China’s first presidential participation in the annual meeting of the WEF. What kinds of changes will China bring to the forum? And in what way will the forum influence China?

De Dardel: As the first Chinese president attending the WEF in Davos, the participation of Xi Jinping sends a strong signal that China is endeavoring to take a stronger role on global issues. Established in 1971, the Davos Forum remains the foremost creative force for engaging the world’s top leaders in collaborative activities to shape the global, regional and industry agendas each year. In 2016, a series of events have happened in the international arena: Brexit referendum, migration, terrorism and the rise of protectionism and populism. This year’s forum will provide a platform for world elites to work together in finding a common purpose to achieve a positive outcome.

China has demonstrated in recent years that it will play a larger role internationally. The recent unprecedented market development in China demonstrates the potential for greater market integration. The establishment of the Asian Infrastructure Investment Bank, the implementation of the “One Belt One Road” initiative, and the inclusion of the Renminbi (RMB) in the special drawing rights basket, the foreign exchange reserve assets defined by the IMF, are all concrete examples of a China that is taking a more active and stronger role internationally.

GT: RMB is experiencing an unstable yuan-dollar rate recently. Does Switzerland still have the confidence to expand the offshore RMB market in Zurich as stated last year in a joint declaration between the two sides?

De Dardel: The establishment of an RMB hub in Switzerland offers attractive possibilities and provides great potential for Chinese and Swiss financial institutions to benefit from the further liberalization of the RMB.

Due to Switzerland’s position as one of the most important financial centers worldwide, China’s foreign direct investments (FDI) to Switzerland and Swiss FDI to China have great potential to grow further. The RMB hub in Switzerland, including the establishment of a China Construction Bank branch in Zurich, helps to promote the bilateral trade between China and Switzerland. Swiss financial institutions continue to be interested in contributing to the development of Chinese financial markets and to use the new business opportunities in China. By joining the AIIB, Switzerland helps to support infrastructure projects along the ancient Silk Road and beyond. The Silk Road aims at a better trade connection between China and Europe and therefore provides huge potential for an increased bilateral trade between China and Switzerland. Swiss authorities are very supportive of the further internationalization of the RMB.