Development aid brings big rewards to Swiss economy

Swiss aid helped Mozambicans rebuild their lives after recent devastating floods Keystone

Switzerland's aid to developing countries may be first and foremost aimed at alleviating poverty, but a new study shows that the Swiss economy also reaps benefits from the country's generosity.

The study, commissioned by the Swiss Agency for Development and Cooperation, found that for every franc spent abroad, Switzerland receives back between SFr1.40 and SFr1.60. Thus in 1998 Switzerland recouped an income of around SFr2 billion ($1.2 billion) from a development aid budget of SFr1.3 billion.

The Geneva and Neuchatel university study found that Switzerland’s support to developing countries also had a beneficial effect on employment in Switzerland. The authors said that between 13,000 and 18,000 jobs were created as a direct result of development spending.

In a statement issued on Tuesday, the Development Agency described the effects on the Swiss economy as “unintentional, but welcome”.

“Our country is able to offer competitive goods and services, which meet the requirements of developing countries,” it said in explanation.

The agency added that through their work in developing countries, Swiss companies became more widely known and were able to attract new customers.

Last year Switzerland spent SFr1.46 billion on development aid, corresponding to 0.35 per cent of Gross National Product.

swissinfo with agencies