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Cabinet says change would help maintain industrial

capacity

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Arms exports fell by more than a quarter in 2023

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Weapons sales to Ukraine would remain off limits

By John Revill

ZURICH, Feb 12 (Reuters) - The Swiss government on

Wednesday proposed relaxing restrictions on arms exports to try

to bolster its domestic industry and security policy, a

sensitive move for the neutral country which has blocked the

re-export of its weapons and ammunition to Ukraine.

The cabinet said it sent a proposal to parliament to allow

it to deviate from current restrictions "in extraordinary

circumstances", seeking leeway to adapt its arms export policy

in accordance with changing geopolitical circumstances.

Despite its long-held neutrality, Switzerland has

traditionally been one of the world's biggest arms suppliers,

selling ammunition and armoured vehicles abroad.

However, arms exports fell by more than a quarter in 2023,

with critics blaming blocks on Spain, Denmark and Germany

re-exporting Swiss-made guns and ammunition to Ukraine.

"This would make it possible to safeguard Switzerland's

foreign or security policy interests," the cabinet proposal

said.

"In addition, it would make it possible to maintain an

industrial capacity in Switzerland adapted to the needs of Swiss

national defence."

Still, any changes will not allow Swiss weapons exports to

Ukraine because of the Swiss war materials laws and neutrality

laws.

Switzerland does not allow arms exports if the destination

country is involved in an internal or international conflict, or

if it seriously violates human rights.

Arms exports are also banned if there is a high risk that

they will be used against civilians or passed on to an

"undesirable" final recipient.

Switzerland's arms industry includes multinationals Lockheed

Martin ( LMT ) and Rheinmetall (RHMG.DE), as well as a host of

smaller companies.

The government's planned relaxation did not go far enough,

said Swissmem, the association representing Swiss industry.

"In principle, the export of war materiel is still

prohibited in the event of a crisis," said Swissmem. "Other

countries do not want to rely on the government's goodwill when

it comes to their security."

The Group for Switzerland without an Army (GSoA), an

anti-militarist group, called the plan "completely

unacceptable."

"Swiss weapons will more easily turn up in civil wars or

countries committing grave human rights breaches," said GSoA

political secretary Roxane Steiger. "This proposal goes against

the Swiss tradition of neutrality and humanitarianism."

It is unclear whether parliament might agree to the

proposal, which could still face a referendum if it is approved.