Iraq has expressed disappointment at the cancellation of a deal that would have seen 180 Swiss armoured personnel carriers sent to Baghdad.
But Baha Al-Shibib, the country's ambassador to the United Nations in Geneva, said he did not believe the decision would sour ties between the two countries.
"For sure we are disappointed [with the decision], but we can live with it," Al-Shibib told swissinfo. "I don't think it will affect Iraqi-Swiss relations."
The Swiss authorities announced on Wednesday that the United Arab Emirates (UAE) had withdrawn its request to buy the used M113 carriers.
Under the deal, which drew strong criticism in Switzerland, the vehicles were to have been passed on to Iraq ostensibly for use by the country's police force.
But in August the Swiss cabinet suspended the sale, worth SFr12 million ($9.4 million), following reports that the carriers were instead destined for an Iraqi tank division.
The government demanded guarantees that the vehicles would be deployed for civilian purposes – a delay that led to the UAE cancelling the deal.
Al-Shibib was speaking at the closing ceremony of a two-week training programme for 25 Iraqi diplomats and officials hosted by the Geneva Centre for Security Policy (GCSI).
During their visit, which was jointly funded by Switzerland and France, the Iraqis were introduced to various international and non-governmental organisations active in Geneva in the field of security.
Subjects covered by the course included terrorism, international humanitarian law, arms control and disarmament.
Iraq's ambassador highlighted the programme as an example of the strong ties between Switzerland and Iraq.
"Switzerland has always, as a neutral country, had a positive attitude and has tried to be helpful with the reconstruction process," he said.
"This [the GCSI programme] is an excellent example of that, because in building the country you have to start with building the individual and this is a great contribution by Switzerland. My government is very appreciative."
With a week to go before Iraqis vote on a draft constitution, Al-Shibib added that he was confident his people would seize what he described as "the only way forward".
He said the adoption of the constitution would also send out a message to the insurgents terrorising the country.
"The insurgency's main purpose is to disrupt the political process and the first achievement of the political process is to have a constitution that Saddam denied the people for 35 years," he said.
"The new constitution will strengthen the will of the Iraqi people, strengthen the political process and it will deny the terrorists from fulfilling their aims."
swissinfo, Adam Beaumont in Geneva
In June the Swiss cabinet approved the sale of 180 used armoured personnel carriers to Iraq via the United Arab Emirates (UAE) for SFr12 million ($9.4 million).
The cabinet suspended the sale in August, following reports that the carriers would not be used for civilian purposes. It was announced this week that the UAE had cancelled the deal because of the delay.