The root causes of the financial crisis lie in the North. Yet, its consequences impact in particular the countries of the South and East, affecting the populations in numerous ways. Access to new credit has become more difficult and foreign direct investment (FDI) has plunged. Declining demand for raw materials and the collapse in prices are squeezing down export earnings. Migrants returning home from industrialized countries signify a reduction in remittances transferred and an escalation in the rate of unemployment. Sinking tax revenue and expensive economic stimulus programmes in the northern donor countries are lowering the amount of funds budgeted for development assistance and jeopardizing the achievement of the internationally agreed development goals. The progress made in the fight against poverty over the recent years threatens to be wiped out.
An enhanced international cooperation and an effective interplay of multilateral and bilateral assistance are particularly crucial to overcoming the crisis. Switzerland is contributing to mitigating the effects of the crisis within the scope of its development cooperation, its cooperation with Eastern Europe, and its delivery of humanitarian aid. The increase in Official Development Assistance (ODA) being envisaged by the Parliament to 0.5% of Gross National Income (GNI) is a positive sign coming at the right time. Parliament will take up debate on the budgeting of additional funds during its autumn session. The Supplementary Message being formulated by the SDC and SECO will accord a central place to measures designed to cope with the global crises.
In 2008, SDC Headquarters went through a restructuring process. The objective of the reorganization was to lay the foundation upon which the unified development cooperation strategy of the Confederation, entering into force on 1 January 2009, could be successfully implemented. Thanks to a closer linkage between bilateral and multilateral assistance, the SDC is now suitably equipped to tackle the new challenges. In the second phase of SDC reorganization scheduled for 2009, relations between Headquarters and the Swiss Cooperation Offices are to be rearranged. Switzerland’s presence in its partner countries is to be strengthened and bilateral cooperation enhanced.
Jean-Philippe Jutzi, FDFA Spokesperson, tel: 079 292 08 49.e-mail:
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