"The Italians have decided to give a political impulse to end the talks, and to do so before the end of the year, Couchepin told Swissinfo, adding: "We need to work through the technical issues and then have a political discussion that allows us to coordinate and to give and take depending on the different dossiers."

Whilst the recent dialogue between the two nations seems to have taken a more cordial turn some observers doubt that more deep-seated differences on issues such as taxation and banking secrecy have dissipated. If so, this could mar Switzerland's hopes of Italian support in its bid to join the Schengen agreement, due to the former's concern over the tax fraud article which may require it to lift its precious banking secrecy.

However, negotiators on both sides appeared on the surface optimistic that a solution can be found. “If the will is there on the EU side and the Swiss side, then a solution is feasible,” commented the head of the Swiss negotiating team, Monique Jametti Greiner. Couchepin last week also received assurances from the Italian deputy Prime Minister Gianfranco Fini that a resolution was possible.

Relations between the Swiss and Italian governments have been frayed recently on issues such as the Savings Tax Directive which the Italians held up after objecting to the preservation of banking secrecy in certain countries. A recent tax amnesty on foreign held accounts and investments has also served to rub the Swiss up the wrong way in recent months.