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Opinion: Gadhafi holds Switzerland hostage

The traditionally neutral state has lost more than its honor in the years-long dispute with Libya.

Relations have not always been this sour. Switzerland continued dealing with Libya during the 1980s and 1990s, while the U.N. and the U.S. imposed sanctions.

The Swiss have repeatedly tried to defuse tensions with Libya and win Goeldi’s release. But somehow the diplomatic touch was missing.

Last August, then-President Hans-Rudolf Merz stunned Switzerland when he traveled to Libya and issued an apology for the “unjustified” arrest of Hannibal Gadhafi. He did not succeed in freeing Goeldi but Merz remains under pressure to quit politics ever since.

Then Switzerland drew up a blacklist of 188 Libyans, including the Gadhafi family, banning them from entering the country. Because Switzerland is in the Schengen zone of the European Union, the Libyans were in effect prevented from entering any of the 25 countries in Europe.

Libya retaliated by barring entry to all EU citizens and calling for a "jihad” against Switzerland.

EU countries didn’t appreciate being drawn into a dispute between two non-member countries. Spain, Italy and Germany mediated between the two parties. Leading the way Italy, which has become increasingly dependent on oil imports from Libya, since EU sanctions were lifted in 2004.

As Libya and the EU patched up the visa dispute at the end of March, Libya hailed it as a victory over Switzerland while the Swiss could only wonder if the EU had just placed its relations with Libya above its relations with Switzerland.

Overall the Swiss seem irritated about a lack of solidarity from the European Union, especially that neighboring countries like Italy didn't rise to its side.

Throughout this crisis it has become very clear that, as a non-member of the EU, Switzerland just doesn't have enough of a say when it comes to decision-making in Brussels — or as the Geneva based newspaper Le Temps put it: "In this crisis Switzerland loses more than honor. The country has slowly taken stock of its powerlessness."

And this will certainly give ammunition to both sides in the ongoing debate about whether Switzerland should join the EU.

Karoline Durr is a writer in New York and Berlin. She has covered European business and economics for CNN, CNN International and Bloomberg.