IR Theory

Switzerland didn’t fight in World War II. No Swiss soldiers stormed beaches or defended cities. But while the rest of Europe was being destroyed, Swiss banks were open for business. They processed transactions, stored gold, and kept the money flowing between enemies. When the war ended, Switzerland came out richer than before.

The country made a fortune from the deadliest war in history. And the uncomfortable truth is most people still don’t want to talk about it.

Making Money While Staying “Neutral”

Switzerland had been officially neutral since 1815. When WWII started, they stuck to that position. But being neutral didn’t mean doing nothing. It meant doing business with everyone.

Swiss companies traded with Nazi Germany. They traded with the Allies. German trains moved through Swiss mountains carrying war supplies. Swiss factories made parts for German weapons. At the same time, Allied spies operated from Swiss cities, and diplomats from both sides held meetings in Geneva.

The Swiss government’s explanation was survival. Germany surrounded them on multiple sides. If they didn’t cooperate, they’d be invaded. Many historians accept this reasoning. Hitler never invaded Switzerland, though debate continues about whether he actually intended to.

But survival isn’t free. And Switzerland made sure someone else paid the bill.

Where All That Gold Came From

Swiss banks became Europe’s financial center during the war. Gold poured into Swiss vaults from all directions. The problem was where some of that gold came from.

Three main sources:

• Central banks from occupied countries
• Nazi Germany’s Reichsbank
• Looted personal property, including items stolen from Holocaust victims

The Nazi gold presented the biggest moral problem. Germany needed Swiss francs to buy materials from neutral countries. Switzerland knew this. According to theUnited States Holocaust Memorial Museum, Swiss banks accepted gold that had been stolen from occupied nations and melted down items taken from concentration camp victims.

Swiss bankers claimed they couldn’t tell “good” gold from “bad” gold. They said they were just providing financial services. But internal documents later showed that many suspected exactly where the gold came from. 

Trading with Both Enemies

Switzerland’s wartime trade wasn’t just banking. Real goods moved back and forth across borders throughout the war.

Swiss exports to Germany remained strong through most of the war. Precision instruments, watches, chemicals, and machinery all flowed north. Germany paid with gold, much of it looted.

Switzerland also maintained trade with the Allies, though on a smaller scale. This balancing act let them claim they weren’t taking sides. Technically true. But volume matters, and Germany got more.

TheInternational Committee of the Red Cross, headquartered in Geneva, operated throughout the war. This gave Switzerland additional cover. They could point to humanitarian work while conducting profitable business on the side.

Why This Still Matters

Switzerland’s WWII profiteering isn’t just old history. It created a template that other neutral nations have studied and sometimes copied.

When conflicts break out today, neutral countries face similar choices. Do they maintain strict neutrality and refuse all business? Or do they engage economically while staying militarily neutral?

The Swiss model showed that huge profits can be made during wartime without firing a shot. Banking secrecy, strategic trade, and claims of necessity can justify almost anything.

International relations experts still debate these questions. When does practical neutrality become immoral profiteering? Where’s the line between survival and exploitation?

Switzerland eventually faced some accountability, but it took 50 years. And even now, the lesson hasn’t fully been learned. When the next major conflict comes, neutral nations will face the same temptations. History suggests many will make the same choice Switzerland did.

The Uncomfortable Truth

Switzerland got rich during World War II. They banked Nazi gold, kept Holocaust victims’ assets, and traded with both sides. When confronted, they delayed and denied for decades.

The country’s wealth today is built partly on these wartime profits. That’s not the whole story of modern Switzerland, but it’s part of it. A part that doesn’t fit the image of peaceful neutrality and humanitarian values.

The world has mostly moved on. Switzerland is seen as stable, prosperous, and trustworthy. But the questions raised by their WWII conduct remain relevant. How do we judge nations that profit from others’ suffering? What does neutrality really mean when money’s involved?