In AI arms race, Swiss neutrality is double-edged sword

In AI arms race, Swiss neutrality is double-edged sword

In May 2025, the European Space Agency (ESA) opened the European Space Deep-Tech Innovation Centre (ESDI) at the Switzerland Innovation Park Innovaare in Villigen. It marks the ESA’s first permanent presence in Switzerland.

Keystone / Michael Buholzer

From Google and Anthropic to tech startups, artificial intelligence developers are expanding in Switzerland – despite concerns that military neutrality may curb access to lucrative foreign defence markets.

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Listening: In AI arms race, Swiss neutrality is double-edged sword

This content was published on

July 30, 2026 - 09:00

11 minutes

From cross-strait relations (political and economic relations between China and Taiwan), the US-China rivalry, Sino-Swiss relations, China and its political structures to adaptive development and technological innovation, I report on foreign affairs and their possible impact on Swiss/Chinese politics, economics and society. A former journalist in Beijing, I am interested in China and its political structures, adaptive development and technological innovation. I studied journalism and communication in China and in Switzerland. Since joining SWI swissinfo.ch in 2015, I have developed a keen interest in international affairs with a focus on China's relations with other countries/blocs and where Switzerland stands.

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Switzerland is quietly becoming the world’s hub for artificial intelligence (AI) talent.

While an increasingly fractious AI arms race between the US and China grabs headlines, the Alpine country has been recruiting: it is now home to twice the number of AI researchers relative to its population than America or rival centres such as the UK.

In less than two years, OpenAI, Anthropic, Jeff Bezos’s Prometheus venture and a growing number of startups have established or expanded research in Switzerland, making the country of under ten million people a top industry spot by some measures.

“I would wager that now, we have a higher density of large tech corporations here than you would see anywhere else in the world,” said Alexandre Meldem from the Deep Tech Nation Switzerland Foundation, a nonprofit promoting Swiss competitiveness in AI, which was set up in 2024 by UBS and Swisscom.

In 2025, the country had more than 110 researchers and inventors in AI per 100,000 inhabitants, the most in the world, according to the 2026 Stanford AI Index ReportExternal link published in April.

While there are many reasons for the success, one that stands out as very Swiss is the nation’s history of neutrality. As geopolitical rivalry between the US, China and the European Union (EU) over strategic control of AI heats up, the Swiss policy of remaining non-partisan allows it to work across divides.

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“Switzerland’s political neutrality is not merely a diplomatic tradition,” Meldem told Swissinfo. “For companies engaged in frontier technologies, it can also present a strategic advantage.” This prospect has helped attract investment from overseas, he said.

But neutrality can be a double-edged sword. Switzerland’s policy of military impartiality, including restrictions on exports that can be used in armed conflict, raises concerns that businesses based in the country may face hurdles selling into foreign markets. Fuzzy lines between civilian and military tech, seen most vividly in the use of adapted consumer drones in the wars Ukraine and Iran, only add to these worries.

Investment magnet for technology titans

Zurich, which is also the final centre of the country, is the main hub of Switzerland’s tech industry.

The country’s biggest city is an investment magnet due to its cluster of top research institutes, cutting-edge firms and educated workers. The federal technology institute ETH Zurich, specialising in science and technology, is the top-ranked university in continental Europe.

Google’s Zurich office has become its largest engineering centre outside the US. AppleExternal link, OpenAIExternal link, AnthropicExternal link and MicrosoftExternal link have also boosted research investments in the city in the past two years, while Meta has expanded too, reportedly to serve AI and research operations. Jeff Bezos’s Prometheus project has added a Zurich office to sites in San Francisco and London.

Big Tech and AI firms in the Zurich area.

Image concept by ETH AI Center Visualization by Greater Zurich Area Ltd., 2025

The city is also attractive for technologies aligned with AI.

The Robotics and AI Institute, a US research group set up by Marc Raibert, the founder of the Boston Dynamics company, last year opened a European R&D centre along with ETH Zurich. The same year, Germany’s Neura Robotics relocated development of its 4NE1 humanoid robot to Zurich, citing levels of innovationExternal link in the sector already established there.

‘Flexibile and pragmatic’ regulation

Part of the draw has also been Switzerland’s relatively hands-off approach to regulation.

The country takes a “flexible and pragmatic” approach to new tech, preferring to wait and see, rather than setting regulatory hurdles immediately, said Marc Pollefeys, an ETH Zurich computer science professor and director of the Microsoft Mixed Reality and AI Lab.

Unlike the EU, Switzerland has not developed all-encompassing AI legislation, preferring to observe how other countries implement their regulations and to learn from their experiences before deciding whether new rules are necessary, Pollefeys said.

It’s taking time to judge whether existing rules in areas like finance and healthcare are sufficient to deal with the impact of new tech – a strategy that allows more room for business to innovate and explore what works in a rapidly changing world.

Switzerland is also less troubled by rivalries between the world’s economic superpowers.

In June, the US government blocked all access by foreign nationals to Anthropic’s top frontier AI system, forcing the company to remove it from the market without notice. The Chinese government also demands that companies submit their models for approval, while Apple, Meta, and Paris-based Mistral AI have criticised complex EU regulation.

“Recent controversies surrounding US AI labs would never happen in Switzerland,” Meldem said, adding that such political and regulatory turbulence has “a profound impact on the R&D direction and compliance costs of AI technology companies”.

In the latest example, the release of a high-performing AI in China this month revived efforts within the US government to ban foreign open-source models, US online media Axios reported.

Such events contrast with Switzerland’s technological neutrality, pragmatic regulation and stable environment, making it “an ideal place to develop deep technologies such as AI, robotics, biotechnology and advanced engineering,” Meldem said.

Military neutrality in a dual-use world?

But Swiss neutrality can also have downsides for business.

The country’s Federal Act on War Materiel, dating from the mid-1990s, places controls on exports of dual-use products that can be utilised for both military and civilian purposes. By definition, AI and machine learning can be used for either.

“Civil and military domains are increasingly blurred,” Leo Eigner, a senior researcher at ETH Zurich’s Center for Security Studies, wrote in an article published on the university’s website. “Academic debates confirm the dual-use nature of almost all research, especially of AI, biotechnology, or other critical technologies.”

Swiss law bars the export of military equipment to nations engaged in conflict as well as the re-export of military materiel constructed with more than 50% domestically-made components.

Some European countries have already shunned Swiss defence companies because of problems over accessing munitions for use in the war in Ukraine. The actions prompted parliament in Bern this year to relax export regulations for 25 friendly nations.

>> Read more on why and how Swiss arms export rules have been impacted by the war in Ukraine:

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Switzerland eases arms export rules as its industry is shunned by Europe

This content was published on

Jan 29, 2026

Switzerland will allow the sale of weapons to countries embroiled in conflict, in a move favourable to its defence industry. The country insists such exports are compatible with neutrality.

Read more: Switzerland eases arms export rules as its industry is shunned by Europe

Even so, areas like quantum computing, advanced semiconductor manufacturing, AI and additive manufacturing such as 3D printing still fall under the stricter export controlsExternal link regulating dual-use technology which were introduced by legislation in 2025.

Companies involved in the research and development of defence technology and dual-use technologies may be affected, according to Pollefeys. The legal hurdles might limit access to major contracts with the US, EU or NATO, even driving businesses to exit the country.

Company exits driven by defence markets

In late 2024, DestinusExternal link, a Swiss-founded aerospace and hypersonic aircraft technology, relocatedExternal link its headquarters from Switzerland to the Netherlands because of potential multimillion dollar orders for its advanced drones from NATO and the EU.

“With a holding company headquarters in Switzerland, we wouldn’t be able to benefit from that,” founder Mihail Kokorić, told Bilanz, a Swiss business news outletExternal link, though he added that workers in the country would not be affected. Destinus told Swissinfo that a range of considerations informed its move, including being close to customers, industrial partners and supply chains, as well as being near European defence programmes.

Another company that relocated is AuterionExternal link, an ETH Zurich spin-off that developed the open-source PX4 autopilot standard adopted by hundreds of drone manufacturers and used in areas from agriculture, surveying, logistics and the military.

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The software maker moved to Munich, Germany and Arlington, Virginia, with a proximity to Washington DC that put it “at the epicenter of defence innovation and policy,” Auterion said in a statement at the time. The company didn’t address the matter of any potential impact from Swiss export controls in a response to questions from Swissinfo, but stated that it “continues to maintain its civil operations in Zurich”.

The Swiss State Secretariat for Economic Affairs told Swissinfo it was unable to comment on “individual companies or their decisions regarding company location”.

Talent remains Switzerland’s secret sauce

Despite hurdles over military procurement, Switzerland remains attractive to many in AI and related fields due to its large pool of scientists and engineers. The country is also a net importer of such talent, ranking among the top five destinations for AI researchers.

That’s become more salient after a crackdown by the US administration on immigration, as

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