Increased government spending during the COVID pandemic resulted in increased debt, especially among developing countries. Switzerland and the World Bank are providing support in that regard with a focus on the management of public finances and financial reporting by companies. On 30 September, the Federal Council took the decision to allocate CHF 39.4 million towards these efforts by 2028.
This decision by the Federal Council strengthens Switzerland’s cooperation with the World Bank within the framework of SECO’s economic cooperation. The approved funds will serve to support partner governments in planning, approving, implementing, and finally reviewing their national budgets in accordance with international standards. One important principle, for example, is that the running costs of investments must already be taken into account when the investment decision is made. This includes, for example, the salaries of teaching staff when building a new school or the maintenance costs of a newly planned road.
The projects are designed to ensure that taxpayers’ money is used in a sustainable and efficient manner, thereby strengthening citizens’ trust in their governments. Governments are supported in creating rules on the basis of which public and private companies report on their finances in a uniform and transparent manner. Financial reporting of a high standard is important for efficient investment and also serves as a basis for fair corporate taxation.
The project is in line with Switzerland’s International Cooperation Strategy 2021-2024 by which Switzerland seeks to strengthen public financial management and public services in partner countries to promote sustainable economic growth. It is financed within the framework of existing funds for economic development cooperation.