VZCZCXRO6837
PP RUEHIK RUEHYG
DE RUEHSW #0029/01 0121303
ZNR UUUUU ZZH
P 121303Z JAN 07
FM AMEMBASSY BERN
TO RUEHC/SECSTATE WASHDC PRIORITY 3568
INFO RUEHZG/NATO EU COLLECTIVE PRIORITY
RUEHC/DEPT OF LABOR WASHINGTON DC PRIORITY
RHMFIUU/DEPT OF ENERGY WASHINGTON DC PRIORITY
RHEFHLC/DEPT OF HOMELAND SECURITY WASHINGTON DC PRIORITY
RUEATRS/DEPT OF TREASURY WASHINGTON DC PRIORITY
RUEHGV/USMISSION GENEVA PRIORITY 2647

UNCLAS SECTION 01 OF 03 BERN 000029 
 
SIPDIS 
 
SIPDIS 
SENSITIVE 
 
STATE FOR E, EUR, H, DS 
TREASURY FOR DEPUTY SECRETARY KIMMITT AND U/S TIM ADAMS 
DHS FOR SECRETARY CHERTOFF 
 
E.O. 12958: N/A 
TAGS: PREL ETRD ASEC SZ
SUBJECT: SCENESETTER FOR USG PARTICIPANTS IN THE 2007 WORLD 
ECONOMIC FORUM ANNUAL MEETING IN DAVOS 
 
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Summary 
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1.(U) Following is Embassy Bern's scenesetter for 
participants in the World Economic Forum (WEF) 2007 Annual 
Meeting in Davos, Switzerland, January 24-28.  The first 
section provides an overview of the Forum, the second section 
reviews U.S.-Swiss bilateral issues, and the third presents 
the essentials of the Swiss political system.  End summary. 
 
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World Economic Forum Annual Meeting in Davos 
-------------------------------------------- 
 
2.(SBU) The Annual Meeting of the World Economic Forum in 
Davos is the largest event of its kind in the world, thus 
offering a useful opportunity for officials to convey the USG 
message and to hear what leaders from around the world are 
thinking.  Within the WEF, there remains considerable 
discussion on how to balance the size of the meeting -- 
intimacy is difficult at 2,200 participants -- with the 
desire for a broad variety of discussion themes.  Also 
controversial is the extent to which celebrities in the past 
have overshadowed the more substantive contributions of 
political, economic, and social leaders.  There is plenty of 
gloss to the WEF, but the more interesting aspects of the 
meeting are usually to be found among the sober meetings and 
informal networking available to participants. 
 
3.(U) The Geneva-based World Economic Forum (WEF) is an 
independent international organization, with a 
self-proclaimed commitment to "improving the state of the 
world."  It can be thought of as a large think tank with 
global mobility.  The WEF's aim is to be a leader in 
identifying strategic issues and providing a platform for 
decision-makers -- from government, business, and the media 
-- to effect change.  WEF meetings are funded by membership 
fees from about a thousand global companies. 
 
4.(U) The annual January meeting in Davos is the WEF's 
signature event.  The exclusive invitation list includes the 
leaders of member companies, as well as influential leaders 
from governments, multilateral organizations, academia, 
media, and NGOs.  The program for the WEF can be compared to 
an annual professional meeting, with panels, lectures, 
speeches, and theme dinners.  Participants must choose 
beforehand which program elements they wish to attend.  This 
year's theme is "the Shifting Power Equation." 
 
5.(U) WEF organizers expect to limit the number of invitees 
this year to 2,200, down from last year's 3,000, in order to 
regain its original mission as a small, informal gathering. 
Even at this size, however, the WEF Annual Meeting in Davos 
remains the world's largest private gathering of global 
leaders.  Members of the Swiss government participate in WEF 
meetings, but do not direct the agenda.  Swiss security 
services are deployed to protect the event, however. 
Security within the Davos Conference Center and select hotels 
restricts entry to invited WEF guests only, with very limited 
exceptions for security details.  Lodging for non-invitees is 
scarce and very expensive. 
 
6.(U) The atmosphere of Davos makes the WEF a unique event 
and provides USG officials with numerous opportunities to 
advance U.S. foreign policy objectives.  Likely attendees to 
the 2007 WEF include 25 heads of state or government, 
including UK Prime Minister Blair, German Chancellor Merkel, 
Brazilian President Lula, Mexican President Calderon, and 
King Hussein of Jordan.  Likely USG cabinet attendees include 
Energy Secretary Bodman, DHS Secretary Chertoff, Labor 
Secretary Chao, United States Trade Representative, Susan 
 
SIPDIS 
Schwab, and Agriculture Secretary Johanns.  Sub-cabinet 
attendees include Treasury Deputy Secretary Kimmitt and 
Treasury Under Secretary Adams, and State Under Secretary 
Sheeran.  Likely Congressional attendees include about 10 
senators and 5 representatives. 
 
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U.S.-Swiss Bilateral Ties 
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BERN 00000029  002 OF 003 
 
 
 
7.(SBU) Switzerland is neither a member of the European 
Union, nor NATO -- a unique status among major Western 
European nations.  Switzerland's prominent banking sector, 
advanced technological sector, diplomatic good offices, 
humanitarian tradition, and status as Protecting Power for 
the United States in Tehran and Havana make healthy bilateral 
relations important.  The bilateral relationship has been 
fundamentally strong, but was strained during the past ten 
years, first due to the Holocaust Assets issue and then Swiss 
objections to USG policies vis a vis Iraq, Guantanamo, and 
the broader war on terrorism.  Recognizing that a drift in 
bilateral ties was not in Switzerland's own interest, the 
Swiss Federal Council (cabinet) decided in May 2005 to 
enhance cooperation in the political, counter-terrorism/law 
enforcement, and trade spheres.  These efforts resulted in 
the signing of three agreements in 2006:  The Framework 
Agreement on Enhanced Political Cooperation; the Operative 
Working Agreement on Counterterrorism Cooperation; and the 
Trade & Investment Cooperation Forum. 
 
8.(U) Political Cooperation:  The Swiss have deployed 200 
soldiers to Kosovo, about 20 to Bosnia, and a handful to 
Afghanistan.  The Swiss public's adherence to traditional 
neutrality, however, has slowed government efforts to double 
Switzerland's peacekeeping strength. The Swiss and U.S. 
governments engage in regular consultations to pursue 
cooperation in areas of key mutual interest.  Regions include 
the Balkans, the Broader Middle East and North Africa 
(BMENA), Sudan, South & Central Asia, and Latin America. 
Themes include terrorist finance, counterterrorism, 
international law, humanitarian disaster relief, Muslim 
integration, and UN reform.  The U.S. and Switzerland have 
recently co-hosted international conferences on bioterrorism, 
terrorist finance, and the elimination of plutonium producing 
plants in Russia.  U.S. and Swiss aid workers are looking at 
joint projects for helping Kosovar and Bosnian societies 
transform.  For Sudan, Swiss and U.S. officials facilitated 
the north-south peace agreement and security officials are 
exploring areas of cooperation on rehabilitating fighters to 
civilian life.  The Swiss are donors toward Foundation for 
the Future programs to aid civil society in the BMENA region. 
 
 
9.(U) Counter-terrorism and Law Enforcement:  Switzerland has 
suffered no terrorist attacks, though terrorist organizations 
appear to have used Swiss territory, banks, and cell phones 
to provide some logistical support for attacks in New York, 
Riyadh, Jerba, and Madrid.  With EU member states getting 
tougher on terrorists, there is concern that groups are 
increasingly attracted to Switzerland as a safe-haven. 
Following the attacks of September 11, 2001, Switzerland 
invited the FBI to embed an agent with its Police 
Counterterrorism Unit.  Law Enforcement cooperation remains 
nascent, however, as Swiss legal restrictions and practice 
limit the information they share to that with a specific U.S. 
nexus.  An upgraded Operative Working Agreement to be 
presented to Parliament in March 2007 should allow joint 
investigations under limited conditions.  On export controls, 
the Swiss are signatories to all relevant multilateral 
regimes.  They approach export control and non-proliferation 
in earnest, but have few resources dedicated towards 
intelligence and enforcement.  Expanding the level of 
cooperation in these areas are among the Embassy's primary 
goals. 
 
10.(U) Trade & Investment:  Switzerland has the 16th largest 
economy in the world, is the 12th largest aid donor, the 4th 
largest financial center, and a major source of direct 
investment in the United States.  The U.S. is Switzerland's 
second largest trading partner.  Swiss economic officials 
initially approached the USG about pursuing a free trade 
agreement in 2005.  Though USTR and the Embassy encouraged 
this movement, the Swiss Federal Council as a whole later 
balked at commencing talks, not wanting to fully open 
Switzerland's highly protected agriculture sector.  Then USTR 
Rob Portman instead proposed the creation of a Trade & 
Investment Cooperation Forum to resolve more modest trade 
disagreements.  The USG and Swiss governments also 
participate in a Joint Economic Commission (JEC) to review 
broad economic themes.  This year's WEF will feature a JEC 
 
BERN 00000029  003 OF 003 
 
 
panel including USTR Schwab, FedEx CEO Smith, Swiss Economics 
Minister Leuthard, and Nestle CEO Brabeck. 
 
--------------------------------------------- -- 
Political System:  How the Swiss Make Decisions 
--------------------------------------------- -- 
 
11.(SBU) Switzerland boasts one of the world's most 
federalized political systems; considerable authority still 
rests with individual communities and the 26 cantons 
(states).  The constitution of 1848 was based on the American 
constitution, with a part-time bicameral legislature and only 
limited competencies assigned to the central government.  The 
seven-member Federal Council (cabinet) is the executive 
authority.  The presidency is largely ceremonial and rotates 
among the federal councilors for one-year terms.  All four 
major parties -- ranging from the left-wing Social Democrats 
to the right-populist Swiss Peoples Party -- have at least 
one seat on the Federal Council, meaning that decisions are 
necessarily by consensus.  Government decisions can be 
challenged by popular referendum.  The dispersal of power 
throughout the political system has served as both a 
guarantor of personal liberty and a brake on political 
change, for good or ill. 
 
12.(SBU) Justice/Police Minister Christoph Blocher and 
Defense/Homeland Protection Minister Samuel Schmid are both 
from the right-populist Swiss Peoples Party, though they are 
often seen as political rivals.  The two oversee internal and 
external intelligence services, respectively and each is 
pushing his subordinates to cooperate better.  Minister of 
Economic Affairs Doris Leuthard is from the centrist 
Christian Peoples Party, is generally pro-free-trade, and is 
the newest member of the Federal Council, having joined in 
July 2006.  Finance Minister Hans-Rudolf Merz and Home 
Affairs Minister Pascale Couchepin are both from the centrist 
Liberal Party.  Social Democrat Micheline Calmy-Rey is 
Minister of Foreign Affairs, is very pro-EU, and has often 
been critical of the United States.  Under the influence of 
more sober DFA advisors, she has mellowed since beginning her 
tenure as Foreign Minister in 2003, and supports a greater 
Swiss peacekeeping presence abroad.  Rounding up the Federal 
Council is relatively moderate Social Democrat Moritz 
Leuenberger in charge of the Environment, Transport, Energy, 
and Communications portfolio.  Notwithstanding this division 
of responsibility, major decisions within all portfolios are 
reached by the Federal Council in its entirety, a factor 
adding to Switzerland's distinct political personality. 
CONEWAY