How is Geneva planning to face the challenges ahead? How will it manage to ensure continued growth and development without upsetting the local population? François Longchamp, President of Geneva Canton’s government branch and Minister in charge of the Depart-ment of Social Services and Employ-ment agreed to discuss the matter in an exclusive interview with Business Mir at Geneva’s City Hall.
How do you envision the future of Geneva and its outlying areas? What is the big picture for the region’s future development? What obstacles and objections will have to be countered in order to achieve these goals?
It is true that Geneva Canton has to face some problems linked to development. Some services, such as public transportation, aren’t suited to a region that employs 300,000 people. We can’t truly expect to be considered a high quality of life region with over-crowded trains, a shabby railway station, etc. Major building projects are underway to improve the situation, which include extending tramway lines and the upcoming construction of the CEVA (fast train link between Geneva and neighbouring France). The CEVA will be decisive step towards reducing Geneva’s isolation in terms of rail service, as the canton has hitherto always been a cul-de-sac on the railway network. Another important step is the long-awaited 3rd railway line between Lausanne and Geneva, which will have a considerable impact on the issue of over-crowded trains. As for Geneva Airport, which has long been accused of being shabby and illequipped to handle its steadily increasing air traffic, 250 million CHF has recently been invested to rectify the situation. The fist phase of the project involves modernising and expanding existing facilities. This will be followed by the construction of a new terminal designed to accommodate large carrier planes in 2011, with an estimated budget of 350-400 million CHF. Another challenge Geneva will have to overcome is the scarcity of available housing.
On that subject, how will the housing crisis and real estate speculation be managed? Is it still possible to build in Geneva Canton? Or is the region completely saturated already?
Although Geneva Canton is not an infinitely extendable territory, we’re far from having reached complete saturation. Major projects are underway that should improve the problem of insufficient available housing in Geneva. We can no longer build thousands of apartments in a few short months as construction regulations have become much stricter since the 1960s and 70s. Furthermore, if we hope to remain a highly desirable region which will continue attracting very profitable professions, we can’t just build any old housing. Unfortunately, there’s no miracle solution to resolve the issue in a short period of time.
Safety issues, a reduced quality of life, and traffic-snarled roads indicate that development has also had a negative impact on Geneva’s general appeal. How does the city plan to act effectively on these issues? How can Geneva’s native population, which might generally feel left out, adjust to the Canton’s development?
It’s certainly true that the Geneva region’s appeal has its negative aspects as well. Geneva’s success attracts a variety of people and we have to deal with issues that are relatively new to us. But overall, Geneva continues to be a safe city for its size compared to other international locations. On the other hand, I’m not convinced that Geneva natives are left out of the process. The local population has demonstrated its confidence in Geneva Canton’s future on numerous occasions, notably with the referendum on Schengen and bi-lateral agreements with the EU. The CEVA project and proposed expansion of Geneva’s UN headquarters were accepted by a large majority of voters whereas the anti-minaret proposal was massively rejected in Geneva in November, 2009. The Swiss political system, which is based on federalism and direct democracy, has the distinct advantage of obliging elected officials to regularly seek voters’ sanctions on their actions. This means that the local population must systematically adhere to projects promoted by their elected politicians. Geneva natives are well aware of the fact that they cannot expect to be rich and keep a high-standing position in the world or have high-quality infrastructure without making compromises.
How can the spirit of an international Geneva be maintained and further fostered? And how will international institutions be encouraged to relocate to or remain in Geneva?
Geneva’s long-standing, traditional role as an international city is particularly important to us and our strategy has always been aimed at developing this sector. At the height of WWII in 1942, Geneva decided to build an international airport. It was an important and visionary decision which enabled Geneva to become a unique and outstanding location for international institutions like the UN, the WTO, the ILO, etc. to establish headquarters. There are no signs that this trend is currently waning. On the contrary, Geneva is actually more ‘the place to be’ than it ever was for new nations on the international scene and NGOs, which have been developing rapidly over the past few years. The appeal for international institutions to establish offices in Geneva is obvious. Our role is to guarantee that the conditions which have made Geneva appealing and successful be perpetuated and sustained in the long term. This includes facilities such as roads, railways and airlines as well as infrastructure including schools, culture and housing.
What is the Geneva financial market’s future in light of the global economic crisis and the current pressure from major European countries to reform Switzerland’s longstanding policy of bank confidentiality?
As far as I’m concerned, it’s too early to measure the current economic crisis’ real impact. To give you an example, at the height of the crisis last summer, Geneva’s Salon de l’Auto (International Automobile Show) organisers were seriously concerned about the event’s future. However, this year’s fair attracted a huge audience and attendance increased by 5% in comparison to events held in previous years. Similar conclusions can be drawn in the financial sector. Geneva has held a privileged position on the financial market, and particularly in the private banking sector, for over 200 years. The current economic situation pales in comparison to the various crises and conflicts Geneva has survived in the past. During the Swiss banks’ unclaimed assets affair a few years ago, some parties claimed that the Swiss financial market would never recover and those dark predictions have proved to be completely off the mark. Geneva’s success – and Switzerland’s success in general – really rests on two elements: competence and trust. This is exemplified by the reputation for competence our banking systems and companies enjoy, as well as the sense of trust our institutions and administration inspire. If we can maintain the high standards that have made Geneva successful, there’s no reason to believe that our financial market will crash overnight.
Over the past few years, Geneva has quietly become one of the world’s centres for petroleum product trading. Are there any projects or programmes planned to maintain and perpetuate this trend?
Our strategy is based on ensuring optimal executive conditions to develop our economic activities rather than designing projects or developing specific programmes. If 70% of the world’s petrol is currently traded in Geneva, it’s because we worked on creating the conditions which led to this success by capitalising on the unique skills I mentioned earlier and by responding adequately to fiscal concerns. We have a good understanding of what challenges businesses who want to establish themselves in Geneva are faced with, and we work on helping them find the appropriate solutions. Businessmen who come to us for advice obtain rapid and pertinent responses, which we guarantee in the long term. Being close to the centre of power is very helpful in these cases and although the system is not perfect – it can take up to 3 years to obtain a construction permit – issues are handled quickly and concrete solutions proposed. Few places in the world can combine that kind of flexibility with such easy access to the powers that be and these factors contribute greatly to the success Geneva, and Switzerland in general, have achieved.
Although acquiring a work permit and establishing residency in Geneva has been facilitated for citizens of the European Union, it has become more difficult for non-Euro zone nationals to do so. Is this policy compatible with the presence of American and/or Russian companies, which have a significant impact on Geneva’s economy, and does it correspond to the canton’s ambitions of becoming a global trading centre?
It’s a fact that the quota of permits for non-EU citizens has been greatly reduced, but that’s down to the federal government rather than local administration. We have been forced to only accord permits to highly qualified individuals if they are not EU-member nationals. It should be noted in passing that the Geneva job market has exploded over the past few years. For example, the quality of Geneva’s restaurants has considerably improved with the arrival of EU citizens, and particularly French nationals, who now work in Switzerland.
An increasing number of Russians and citizens of ex-Soviet republics are moving to Geneva, studying there and founding companies in the canton… How do you explain this phenomenon? How can Geneva benefit from this new trend?
Geneva offers foreign nationals various opportunities to develop their commercial projects. Aside from business banks, Geneva also has an extensive network of lawyers specialised in international trade. Swiss contract law is straightforward and practical, making it distinctly appealing to foreign businessmen. After all, success leads to even grater success and numerous Russians have lived and continue to reside in Geneva, for both its high quality of life and its history. Distinguished Russian public figures, such as UN Director General Mr. Sergei Ordzhonikidze or Green Cross International’s President and founder Mr. Mikhail Gorbachev spring to mind and many Russians have followed in their footsteps. Finally, the Russian Church at rue de-Beaumont – consecrated in 1866, just 5 years after Paris’ Russian Church – is proof of Geneva’s thriving, long-standing and wellintegrated Russian community.
Last September, Vaud Canton sent an important delegation of financial and political players to Moscow. Tessin Canton is planning to follow suit this autumn. Has Geneva planned any similar initiatives to promote its financial advantages in Russia?
Geneva Canton organised several similar events in Russia well before other cantons even considered doing so. We will naturally continue to pursue this policy in the future.
