Hi Richard. A lot more detail on Swiss thing.
Scant opposition to Swiss gold sales
By Michael Shields
ZURICH, April 19 <Picture: (Reuters)> - News that Swiss voters had given a green light to eventual gold sales warranted barely a mention in the Swiss media on Monday, underscoring the fact that political opposition to such transactions is practically zero.
Politicians of all stripes have welcomed the idea of selling off 1,300 tonnes of gold -- around half the Swiss National Bank's gold reserves -- and the only debate that lies ahead is over how to use the proceeds, political analysts say.
Activists from the political right who mustered a surprisingly strong 'No' vote in Sunday's referendum on a new constitution severing the Swiss franc's peg to gold promise to fight proposals to give away any gold proceeds to foreigners.
This could conceivably spell trouble for the Solidarity Foundation humanitarian fund that the Berne government proposed in 1997 as a way to lift neutral Switzerland above a mire of accusations that it cynically profited from World War Two.
Much of the criticism came from Jewish groups that slammed Switzerland's commercial ties to Nazi Germany and alleged Swiss banks hoarded Holocaust victims' dormant wealth.
Even though the government has since made clear that the Foundation -- earmarked to get 500 tonnes of gold reserves -- will not pay compensation to any individual Holocaust victims, many Swiss still associate it with Jewish causes.
"We will fight tooth and nail against (gold sales) for any kind of payment obligations to Jewish circles or the like," said Walter Steinemann, a member of parliament from the right-wing Freedom Party.
"If the National Bank sells gold to manage it better in our own country, then I am in complete agreement," he told Reuters, but added, "I will fight the Foundation to the end."
Such opponents to the new constitution made a fight out of what the government had expected to be an easy victory on Sunday.
They got out a nearly 40 percent No vote by stoking fears that the new constitution was a Trojan horse whose obscure details would make it easier to join the European Union, abridge parents' rights or infringe on Swiss sovereignity.
Caught on its heels, the government had to deny this and accused opponents of playing fast and loose with the truth, but heaved a sigh of relief when the measure was approved.
The new constitution needed to carry a majority of voters and cantons, and opposition in smaller, rural, conservative cantons in German-speaking Switzerland made it a close call.
Gold sales were a tiny footnote in the overall debate.
As for what lies ahead, no gold sales can start until parliament approves a new currency law that authorises the SNB to sell gold. The government has said it will submit draft legislation by mid-1999 that could be in place by early 2000.
Opponents could in theory force a referendum on this by gathering 50,000 signatures of voters, but that seems unlikely given general consensus that gold sales are a good thing.
A separate amendment that reforms only the constitution's currency section and expressly allows transferring gold reserves to third parties like the Solidarity Foundation is moving through parliament and faces a popular referendum in March 2000.
The finance ministry has said this amendment is the sole possibility on which to base official gold sales. Until it is in force, the SNB could not split off gold reserves for transfer to third parties.
But provided the new currency law is adopted, it could in theory sell some of the gold on its books and transfer just the profits to the cantons and federal government. This is considered unlikely until sales get clear political backing. Draft legislation that specifically addresses the Solidarity Foundation is due only after the March 2000 referendum.
Steinemann said the cabinet had put this issue on the back burner until after parliamentary elections on October 24.
Swiss newspapers' reporting on the weekend events focused on strong gain in local elections by the Swiss People's Party, whose populist themes have given it new political momentum.
But even this party favours gold sales if they can be used exclusively to help shore up the national pension fund. ((Zurich newsroom +41 1 631 7340 fax +41 1 202 5538, zurich.newsroom@reuters.com))
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