Switzerland’s national flag flies beside the one of the European Union in Zurich, Switzerland May 3, 2022. REUTERS/Arnd Wiegmann/File Photo Purchase Licensing Rights , opens new tab

ZURICH, Oct 18 (Reuters) – The Swiss government received a boost in its efforts to pass the biggest overhaul of Swiss economic relations with the European Union in more than two decades when a centre-right political party, which could prove crucial, gave its backing on Saturday.

The package of measures that covers anything from electricity to state aid, transport and freedom of movement, as well as Bern’s financial contribution to the bloc, was agreed last December and signed off in June by the Swiss cabinet.

It faces a referendum in Switzerland with the biggest group in parliament, the right-wing Swiss People’s Party, or SVP, firmly opposed to it on the grounds it is inimical to national sovereignty, Swiss identity and control of borders.

The SVP’s main rival on the right of the political spectrum, the business-friendly Liberals, or FDP, has been split on the question of Europe but in a ballot to set the party’s stance, three-quarters of delegates voted to support the EU accord.

Concern about neutral Switzerland eroding its independence and unique status within Europe by getting too close to the EU is a potent political issue in the country, and eurosceptics have tended to look towards the United States as an alternative.

However, U.S. President Donald Trump’s decision to impose 39% tariffs on Switzerland – far higher than the rate he set on the EU – has weakened the allure of the United States.

The Swiss government has pitched the EU accord as one that will help anchor the economy in uncertain times.

An opinion poll published last month showed that Swiss voters were twice as likely to back the EU deal as reject it.

A Swiss referendum on the deal is unlikely before 2027 and could be later still.

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