Swiss Weapons Industry Plummets as Ban on Ukraine Resale Takes Toll

Switzerland’s arms exports have continued to decline for a second consecutive year due to the country’s ban on re-exporting weapons to Ukraine.

Reuters reported on March 11 that exports of Swiss-made weapons, ammunition, and related materials fell by 27% in 2023 and another 5% in 2024, according to data from the State Secretariat for Economic Affairs.

The decline stems from Switzerland’s neutrality laws, which prohibit the sale of arms to countries engaged in armed conflicts and block the re-export of previously sold weapons. As a result, Germany was unable to transfer Swiss-made anti-aircraft ammunition to Ukraine.

The restrictions have led to repercussions for the Swiss defense industry. Germany, Switzerland’s largest arms buyer, has removed Swiss companies from some procurement contracts, while Denmark and the Netherlands have suspended orders.

“There is a big surge in defense spending in Europe, and Switzerland will lose this benefit. This is a disaster not only for industry, but also for the country’s defense capabilities,” said Matthias Zoller, a representative of the industry association Swissmem.

The group, which includes companies such as Rheinmetall and Safran Vectronix, has called for a policy shift to support the sector.

Despite the restrictions, Switzerland remains a major arms exporter, particularly in ammunition and armored vehicles. The Swiss government is now exploring potential policy adjustments, including easing restrictions under “exceptional circumstances” or allowing re-exports at least five years after initial delivery. Swissmem has criticized these proposals as insufficient to sustain an industry reliant on exports.

In corresponding news it was reported that the U.S. administration is linked to secret negotiations in Switzerland aimed at resuming Russian gas flows to Germany.