Security policy in transition

Russia’s war of aggression: The Swiss arms industry is benefiting greatly from the shift in security policy since Russia’s attack on Ukraine. The war has led to a turning point in security policy throughout Europe – including in traditionally neutral Switzerland. The federal government is responding to the changed threat situation posed by Russia with a significant increase in defense spending. Parliament has decided to gradually increase the army budget significantly, with the result that additional funds amounting to hundreds of billions of Swiss francs will be allocated to security in the coming years (calculated over several years). The aim is to close equipment gaps, improve operational readiness, and strengthen defense capabilities in light of the war in Ukraine.

Swiss defense companies – including RUAG – report well-filled order books. The following are in particular demand:

– Ammunition

– Spare parts

– Air defense systems

– Modernization of existing weapon systems

Part of the production is used to equip the Swiss army, while another part indirectly supports European countries that in turn supply material to Ukraine or replenish their own stocks.

Despite the high demand, there is repeated criticism from politicians and the military:

– Production capacities have been greatly reduced in recent decades.

– Supply chains are vulnerable.

– The expansion of production lines takes too long.

Industry representatives, on the other hand, point to regulatory hurdles, export restrictions, and a shortage of skilled workers. In addition, building new capacity requires considerable investment and planning security.

The situation places Switzerland in a conflict between:

– its tradition of neutrality

– the economic interests of the arms industry

– European solidarity

– Real politics in security policy

In particular, the issue of re-exports of Swiss war material to Ukraine has led to intense debate in domestic politics. Freight forwarders are keen to register for the award of government transport contracts.

Registration with RUAG: According to ADS, matching markets are of particular interest because limited resources often need to be distributed fairly among several players and these distributions need to be determined efficiently. Previous business with the FDFA gives us confidence.

Source: Thomas Rüegger