Project selection
Reducing poverty and overcoming global challengesSECO’s economic development cooperation
SECO commits to:
Testkapitel 2
Using Peruvian taxes responsiblyA state must be able to mobilise tax revenues and use them transparently.
Ambassador Dominique Paravicini
Head SECO Economic Cooperation and Development
The quality of public finances determines how a country shapes
its business environment, and whether it can offer its population and its
companies functioning basic services and reduce inequality.
Mismanagement, short-term planning and corruption give
taxpayers reason to mistrust the government and to refrain from fulfilling
their tax obligation. SECO helps government administrations plan their
investments thoroughly, improve their public procurement systems, and make them
more transparent.
The example Peru: the country’s economy has grown rapidly
over the past few years. This has opened up opportunities for the government to
better supply its citizens with basic services, for example in the areas of
education, health, water supply, waste management, public transport and
security.
In Peru, regional and local authorities spend more than 40
percent of all public funds. They are expected to manage their finances
reliably and transparently and to use them in line with national priorities and
local strategies. SECO’s Subnational Public Finance Management Strengthening
Programme helps them to do this.
For instance, hundreds of employees in the public sector have completed specialist degrees in managing public finances. Public prosecutors, investigators and members of the judiciary received training on how to track down stolen public assets and investigate accusations of corruption.
Hamilton Castro
Public Prosecutor, Expert in asset recovery, Lima
Solid public finances and good governance boost the
government’s credibility and strengthen the trust of citizens and companies in
public institutions. They are willing to pay taxes for services. Today, Peru is
one of the few countries in Latin America that regularly boasts a budget surplus.
Growth-promoting economic policy
Growth-promoting economic policy
Conducting trade and reducing povertyIn a global economy, it is vital that companies are able to trade their goods.
Ambassador Dominique Paravicini
Head SECO Economic Cooperation and Development
Trade allows companies to become more competitive, to grow,
to preserve jobs and to create new ones. It thus enables many people to
participate in the advantages of globalisation and to escape poverty.
In 2017, the World Trade Organization (WTO) launched a trade facilitation agreement. The goal of the agreement is to reduce bureaucracy and facilitate access to global value chains. According to the WTO, it has the potential to reduce global trading costs by an average of roughly 14 percent and to increase the annual trading volume by up to 1 billion dollars. The poorest countries will benefit the most from this – provided they fully implement the respective measures.
Developing countries often do not conduct international
trade as efficiently as they could. They lack framework conditions, functioning
institutions and technical expertise, which leads to delays and additional
costs. This is why SECO supports its partner countries in setting up modern
systems. One example is the Global Trade
Facilitation Programme (GTFP), which SECO implements in partnership with
the World Customs Organization (WCO).
Video GTFP
Video GTFP
For instance, in Colombia the program is helping the customs
administration to improve risk management and auditing and to implement
sustainable reforms.
«This is helping us on our way to becoming a modern, efficient and transparent organisation, in turn creating a more agile trading environment and greater competitiveness.»
Ingrid Diaz, Director customs administration
«This is helping us on our way to becoming a modern, efficient and transparent organisation, in turn creating a more agile trading environment and greater competitiveness.»
Ingrid Diaz, Director customs administration
In Peru and other Latin American countries, the programme
holds workshops for executive staff from customs administrations. It helps them
develop strategies for the modernisation of their customs authorities.
«The workshop boosted my skills as a manager and it’s helping me to drive forward reforms to facilitate trade. »
Marilú Llerena Aybar, Deputy Head customs administration
Rules-based trade system
«The workshop boosted my skills as a manager and it’s helping me to drive forward reforms to facilitate trade. »
Marilú Llerena Aybar, Deputy Head customs administration
Rules-based trade system
Exploiting entrepreneurship and creating jobsFor companies to become more productive and grow, they need an innovation-friendly business environment.
Ambassador Dominique Paravicini
Head SECO Economic Cooperation and Development
The SECO-funded Swiss Entrepreneurship Programme reinforces
local “ecosystems for entrepreneurship” which support start-ups.
The Swiss Entrepreneurship Programme engages in partnerships
with private local actors who provide services for start-ups. It also reinforces
networks with mentors and investors. It is implemented in Serbia, Albania,
Bosnia-Herzegovina, Kosovo, Northern Macedonia, Peru and Vietnam. The second
phase of the programme began in 2019. It now also aims at influencing the
regulatory business environment in these countries in order to improve the framework
conditions for companies.
In 2019, the programme hosted a Women Entrepreneurs Week for
the second time. Twenty female company founders from seven countries came together
in Zurich to network with one another, with female representatives from the
Swiss start-up scene and international female mentors. The event focused on how
they could successfully position their businesses and market these digitally.
Claudia Quintanilla and Amparo Nalvarte
met in Zurich too. Both
are Peruvian entrepreneurs in the fintech sector. Claudia founded the company
Rextie. The company specialises in converting US dollars into her native
currency at a fair exchange rate – digitally and in real time. Claudia is
looking for investors to help her further develop her company. For instance,
she wants to tailor the company optimally to the Peruvian context and enable
digital signatures too. Amparo was in Zurich as a mentor.
«I was so impressed by Claudia’s dedication, perseverance and belief that I decided to invest 50,000 US dollars in her company myself.»
Amparo Nalvarte, Entrepreneur
Innovation-friendly business environment
With the cable car through Bogotá without traffic jams Cities drive the economy: they generate 80 per cent of global economic output.
Ambassador Dominique Paravicini
Head SECO Economic Cooperation and Development
Cities emit
more than 70 percent of the world’s greenhouse gases. In the coming decades,
populations will grow predominantly in urban areas.
That is why
SECO is helping authorities to organise their cities effectively and linking up
urban areas logically to ensure people can move efficiently within them.
Spotlight
on Bogotá: a SECO-funded cable car has been operating as a means of public
transport in Colombia’s capital city since 2019, stimulating both social and
economic life. Stretching almost three and a half kilometres, the TransMiCable
connects Ciudad Bolívar, a low-income area in the South West, with ones of the
main bus lines in San Cristóbal in the South East of Bogotá.
The
TransMiCable offers more than half a million residents a quick and convenient
way of moving around within their city. It cuts the travel time to workplaces
and public services in the city centre by roughly 80 percent to about 13
minutes. The cable car transported more than 1.8 million passengers in its
first three months of operation alone. The TransMiCable replaces 110 buses,
reducing not only the chronic congestion of the city’s roads, but its CO2
emissions too.
The cable
car project generates social and economic activity. It has helped the community
to revitalise public spaces around the four station buildings. New squares,
community centres, children’s playgrounds and lots of street art have emerged.
These developments spur the local economy and create jobs. In fact, a number of
businesses such as bakeries, souvenir shops, restaurants and even a hotel have
appeared next to the stations.
Ana Mercedes Mora
President of the neighbourhood ‘El Paraiso’, Ciudad Bolivar
In a subproject
funded by SECO, the International Finance Corporation (IFC) advised the
authorities in Bogotá on two questions. How can cities manage urban
infrastructure projects like the TransMiCable efficiently while establishing
international environmental and social standards? And how can the private
sector be encouraged to become more involved in urban infrastructure projects? Subsequently,
the city succeeded in mobilising an estimated 450 million US dollars of private
sector funds for such projects.
Urban development and infrastructure services
Urban development and infrastructure services
Investing in South-African solar energyIn developing countries, it is often difficult for companies to obtain financing.
Ambassador Dominique Paravicini
Head SECO Economic Cooperation and Development
Companies need sound and long-term financing solutions. Then they can invest, tap into new markets and create decent employment opportunities.
That is why SECO
provides companies with capital and technical expertise and trains local banks in
lending.
SECO cooperates with the Swiss Investment Fund for Emerging Markets (SIFEM), the development finance institution of the Swiss Confederation created in 2011. It provides long-term financial support to established SMEs and fast-growing companies in the form of shareholdings, loans and expertise.
Until 2019, SIFEM, together with its co-investors, had succeeded in creating or maintaining around 830,000 jobs.
SECO cooperates with the Swiss Investment Fund for Emerging Markets (SIFEM), the development finance institution of the Swiss Confederation created in 2011. It provides long-term financial support to established SMEs and fast-growing companies in the form of shareholdings, loans and expertise.
Until 2019, SIFEM, together with its co-investors, had succeeded in creating or maintaining around 830,000 jobs.
Change of scenery. The energy sector is South Africa: coal-fired
power stations generate 90 percent of the electricity, leading to high CO2
emissions. As demand for energy in South Africa rises, the power stations do
not have enough capacity to meet the requirements, causing recurring power
outages throughout the country.
While electricity costs in South Africa have risen by more
than 300 percent in the last 10 years, the cost of solar photovoltaic energy has
been falling. This is making solar power increasingly attractive to commercial
and industrial users, in turn promoting a climate-friendly economy. Nevertheless,
South-African SMEs are rarely in a position to finance their own solar energy
systems.
That is why SIFEM invests in the photovoltaic company
SolarAfrica via a fund. The company offers customers modern financing solutions
for solar panels on their roofs. SolarAfrica handles the procurement and
installation of the panels including commercial operation, monitoring and
maintenance. The company concludes power purchase agreements with its
customers. They pay only for the quantity of energy actually used and save up
to 40 percent in comparison with the electricity rates of the local energy
providers. SolarAfrica has installed more than 34,000 solar collectors to date.
Swiss Investment Fund for Emerging Markets SIFEM
Swiss Investment Fund for Emerging Markets SIFEM
One of SolarAfrica’s customers is the Apollo Hotel near Johannesburg.
«SolarAfrica always offers electricity rates that are lower than those of the public utility company. And we have absolutely zero investment costs.»
Jeffrey Hurwitz, Hotel Director
Access to financing
«SolarAfrica always offers electricity rates that are lower than those of the public utility company. And we have absolutely zero investment costs.»
Jeffrey Hurwitz, Hotel Director
Access to financing
Better gold from South AmericaSECO helps entrepreneurs in developing countries integrate into the global economy and take part in value creation.
Ambassador Dominique Paravicini
Head SECO Economic Cooperation and Development
For entrepreneurs to benefit from the value creation of products, they must be able to produce efficiently and operate on international markets. Sustainability standards based on good economic governance avoid grievances such as child labour, the improper use of chemical substances or illegal deforestation.
SECO advocates sustainable value chains with gold from small-scale mining, where roughly 90 percent of all gold miners work. Small-scale mining provides subsistence for around 100 million people, primarily in developing countries in Latin America, Africa and Asia. With simple methods and under dangerous conditions, these miners mine small quantities of gold, which make up for 10 to 20 percent of the global amount.
SECO has launched a public-private partnership with key players on the Swiss gold market. These include refineries, goldsmiths, watch manufacturers, financial institutions and investors. The Swiss Better Gold helps small mines in Peru, Columbia and Bolivia to produce gold responsibly and export it to Switzerland. Four of the world's largest gold refineries are based in Switzerland. Together, they process one third of the gold mined globally. This makes Switzerland a leader in international gold processing.
Swiss Better Gold also integrates voluntary sustainability standards such as Fairtrade Gold, the Alliance for Responsible Mining or the Responsible Jewellery Council are the basis of the initiative. It helps small mines and mining cooperatives improve their technical, organisational, social and ecological conditions and to acquire quality seal certification in the process. The initiative also promotes the political dialogue with the authorities in order to support small-scale mining adapt to sustainability standards.
Sofia Huasco
Member, Cooperativa San Lucas
On the other side of the value chain, buyers in Switzerland pay a surcharge for the fairly produced gold from Swiss Better Gold. They pay the gold mines a premium for their people and environmentally friendly production. Thus, the initiative funds both social and ecological projects.
Sofia Huasco
Member, Cooperativa San Luca
The Better Gold Initiative aims to import around 5 tonnes of gold into Switzerland each year. This enables consumers to buy watches, jewellery, electronic devices and financial products made with responsibly mined gold. So far, more than 30,000 women, men and children in the partner countries have benefited directly or indirectly from Swiss Better Gold.
Integration in value chains
Integration in value chains
Better working conditions in the textile industrySECO helps employers run their businesses responsibly while taking into account social and ecological aspects alongside economic considerations.
Ambassador Dominique Paravicini
Head SECO Economic Cooperation and Development
Companies create jobs, pay wages and taxes, thereby contributing significantly to effective economies and social prosperity. They open up economic opportunities for people, so they do not have to emigrate. Responsible companies provide decent employment opportunities, while increasing the quality of their products and operating more productively.
More than 60 million people worldwide, predominantly women, work in the textile and clothing industry. Textiles account for 70 percent of all exports in some countries. The SECO-funded Better Work programme helps export firms comply with national labour laws and international labour standards.
As part of the programme, workers and the factory management take time to understand each other’s needs and decisions and collaborate in order to improve working conditions continuously.
«We discuss specific opportunities for improvement in regular meetings with management. I see the effort management is making to create a more pleasant and safer workplace.»
Hoang Thi Thuy, Seamstress
«We discuss specific opportunities for improvement in regular meetings with management. I see the effort management is making to create a more pleasant and safer workplace.»
Hoang Thi Thuy, Seamstress
Better Work brings together factory owners, trade unions, governments, and global brands on regional, national and global levels to improve working conditions in supply chains. At the same time, it helps factories to meet the requirements of international buyers in order to compete on the global market.
Since the start of the programme in 2007 until 2019, Better Work has improved the working conditions of 2.4 million employees in 1’700 factories. In these factories, there are significantly less work accidents and employees work considerably less weekly hours.
The measures initiated under Better Work improve employee satisfaction. Employees are less likely to be absent from work and will change jobs less frequently. This leads to improved quality of products and increases efficiency. For instance, Better Work factories in Vietnam increased production by 8 to 22 percent and boosted their profits by 25 percent after four years. They were able to increase revenues, generate more customers and create more jobs.
Better Work was launched by the International Labour Organization (ILO). The programme is active in Indonesia, Vietnam and Bangladesh, as well as in Egypt, Ethiopia, Cambodia, Haiti, Jordan and Nicaragua.
Corporate Social Responsibility
Corporate Social Responsibility
Testkapitel 3
Dual vocational education in IndonesiaCompanies depend on a highly trained workforce in order to remain competitive in a globalised economic environment.
Ambassador Dominique Paravicini
Head SECO Economic Cooperation and Development
A skilled workforce will help companies to grow and create more jobs and economic opportunities, so people do not see themselves forced to emigrate. This is why SECO is involved in the training and further education of skilled workers in higher vocational education.
Indonesia has become a major player on the world stage. It is the fourth largest population in the world and the 10th largest economy and is a member of the G20. In the years between 1999 and 2016, Indonesia managed to halve the percentage of impoverished people in the overall population to around 11 percent. 28 million Indonesians, however, still live below the poverty line and 40 percent of the population are at risk of falling back into poverty.
One of the greatest challenges facing Indonesia is the structure of the labour market. On the one hand, 1.7 million young people enter the workforce every year and find there are not enough jobs. On the other hand, the national educational system does not produce enough workers that possess the skills required by the economy. The logical consequence is a shortage of skilled workers.
In light of this, Indonesian authorities have asked Switzerland for its support. SECO thus launched the project Skills for Competitiveness. Together with the private sector and the authorities, SECO supports five Indonesian technical colleges in the fields of metal, wood and food processing set up a dual vocational education and training system.
Skills for Competitiveness supports the polytechnics in improving their training programmes. Together with experts from the industry, schools develop new curricula, which ensure that technicians and engineers obtain the skills companies need. The project also aims to reinforce teaching staff capacity. More and improved internships align the training programmes more closely with the needs of the industry. To date, the programme has conducted 85 workshops and trainings with over one hundred partners from the industry, benefiting around 800 students and teachers.
«I improved my technical skills during an internship in an industrial company. I learned how to tackle problems with a solution-oriented approach and how to take responsibility within a team. And the allowance relieves my parents’ budget!»
Subhan Ali, Student at the Morowali Polytechnic, Central Sulawesi
Market-oriented skills
The key to strong multilateralismInternationally coordinated action is needed to tackle global challenges such as poverty, inequality, climate change, economic and financial crises, migration and epidemics.
Ambassador Dominique Paravicini
Head SECO Economic Cooperation and Development
Multilateral development banks are indispensable partners for Switzerland’s international cooperation. They are broadly positioned and have the necessary expertise, tools and financial resources. They replicate projects on a large scale and support governments in drafting and implementing policies through policy dialogue. Switzerland contributes its expertise and innovative approaches to this effort.
As a shareholder, Switzerland shapes, together with other countries, the strategic, institutional and operational direction of development banks, including on issues such as capital increases and the multilateral COVID-19 response.
Switzerland is committed to ensuring that development banks develop, comply with, and improve international environmental, social and governance standards. These globally recognised standards help protect global public goods such as the climate, the environment and water, and foster socially responsible economic development. They also serve as guidelines for drafting national standards.
The International Development Association (IDA) is the World Bank’s fund for the World’s poorest countries. Among other things, IDA mobilises private sector investments by mitigating risks. The private sector is key to achieving the sustainable development goals.
For example, thanks to the cooperation between IDA and the private sector, a hydroelectric power plant can be realised in Nepal. The plant will increase the country’s production of electricity by one third.
The support provided to IDA currently represents Switzerland’s largest financial contribution to a development fund.
Multilateral cooperation
The support provided to IDA currently represents Switzerland’s largest financial contribution to a development fund.
Multilateral cooperation
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Reducing poverty and overcoming global challenges
Using Peruvian taxes responsibly
Conducting trade and reducing poverty
Exploiting entrepreneurship and creating jobs
With the cable car through Bogotá without traffic jams
Investing in South-African solar energy
Better gold from South America
Better working conditions in the textile industry
Dual vocational education in Indonesia
The key to strong multilateralism
