Will Europe Split?

November 5, 1962

BERN—Because of our own unique position, few Americans realize the impact of the Common Market on its Western European neighbors. Our own merchandise exports amount annually to only 4 percent of our gross national product, and those to the Common Market countries to only about 1 percent.

Contrast this with the position of some neighboring European countries. Switzerland is already so integrated economically with the rest of Europe that its very survival depends on continuance of this relationship. Its exports amount to 25 percent of its gross national product. In some industries—watches, chemicals, dyestuffs—its exports constitute 90 to 95 percent of total output. The proportion of Swiss trade with Europe reaches about 80 percent for its imports and more than 60 percent for its exports. Last year 62 percent of its imports came from the six Common Market countries and 42 percent of its exports went to them. Switzerland, in short, is already more integrated with the Common Market countries than those countries are with each other.

The relation of Sweden to the rest of Europe is almost as striking. More than 25 percent of Sweden’s national product is exported. Imports are equally high. Both in exports and imports some two-thirds of Swedish foreign trade takes place with the other EEC and EFTA members. Present members of the EEC account for a third of Swedish trade.

DANGERS OF EXCLUSION

Both Switzerland and Sweden are following the negotiations between Britain and the Common Market with intense interest. The outcome will affect the terms of their own association, if any. Exclusion from the Common Market could profoundly disrupt their economic life. They have applied for “associate membership.” By this they mean that they are willing to accept in full all the economic obligations implied by membership without the purely political obligations. Switzerland, for example, neutral by long tradition, would like to retain the right to negotiate trade agreements with third countries, or to withdraw in case of war. But our own government, which has taken so active a part in promoting the Common Market, and in urging British membership, is actively discouraging even associate membership by Switzerland, Sweden, or Austria.

I have talked about this problem with a score of the leading bankers, industrialists, labor leaders, and government officials of Sweden and Switzerland, including Switzerland’s Foreign Minister and former President, F.T. Wahlen, Sweden’s Minister of Trade, Gunnar Lange, and its Prime Minister, Tage Erlander. While government officials are careful to refrain from any criticism of the American attitude, it is obvious that they as well as more outspoken private citizens are deeply disturbed by it.

BUGBEAR OF ‘DILUTION’

Our government’s objection even to associate membership for Austria, Switzerland, or Sweden is based on a vague fear that this would “dilute” the Common Market. On the economic side, the three countries find this baffling because our government wants to dilute the Common Market by urging the adherence of the British and accepting that of the Norwegians, Danes, and Greeks. As the Swiss, Swedes, and Austrians do not even wish to participate in the political decisions or institutions of the Six, they cannot understand how their purely economic association could in any way reduce the will of the Six to achieve closer political ties with each other.

As the European neutrals see it, the United States can only hurt its own political and economic interests by weakening the ties that already bind these neutrals into the European economy. To keep them out of the Common Market would not only do them immeasurable economic harm, but would tend to drive them for self-preservation toward greater ties with Iron Curtain countries. Many Europeans point to the tremendous Russian pressure now being put on Finland, and the possibility that our government’s indifference may force Finland into the Russian orbit. Our policy, as they see it, may tend not to unite Western Europe, but to split it into two rival camps, weakening or destroying the ties that already exist.