Renewable energy, business promotion and healthcare are just some of the areas in which Switzerland is helping eastern Europe.
Ten countries joined the European Union in 2004, seven of them former members of the Soviet-dominated eastern European trading bloc. Over the next ten years they will receive a total of SFr1 billion ($895 million) from Switzerland.
The collapse of the old system left eastern Europe with a legacy of out-dated production facilities and wide-scale pollution. It created exciting opportunities for the business-minded – and misery for those who saw their jobs disappear and their regions stagnate.
Experts warn that the gap between rich and poor both inside the new member states and between them and older members of the EU is creating the potential for instability.
While the EU is allocating large funds to improve the general infrastructure of its new members, Switzerland is concentrating its relatively small contribution on carefully targeted bilateral projects.
"The aim is to reduce inequalities," said Walter Fust, head of the Swiss Agency for Development and Cooperation, one of the bodies overseeing implementation of the projects.
Switzerland has a history of grassroots partnership with the states of eastern Europe that dates back to the 1990s.
A number of Swiss towns have sister-city agreements. Lucerne is twinned with Olomouc in the Czech Republic and has contributed its know-how in environmentally friendly energy. The Czech city's zoo now has a heat and power station fuelled by biomass leftover from the food given to the animals rather than by coal.
Energy saving and job creation have come together in Lucerne's partner in Poland, Cieszyn. The Swiss provided equipment for the Poles to learn how to make and install solar panels.
In other cases money has come from the Swiss government. A fund to promote small businesses has provided start-up credit. One example is a firm in the southern Polish village of Rabka-Zdroj, which makes sheeting and sacks from recycled material.
The benefit is not only for the environment and job creation: the company has also learnt how to face up to competition from the West, by focusing on quality – something that was neglected in the past.
Switzerland says it is vital to make companies in the new EU states internationally competitive. This will help ensure a free flow of trade that will benefit all Europeans, including the Swiss.
Social issues, including health care, are also on the agenda. Lithuania is one country where the Swiss have already backed successful mother and baby healthcare projects.
Lithuanian Finance Minister Rimantas Sadzius told swissinfo that this was a good example of the difference between the Swiss approach and that of the EU.
"By not dispersing but concentrating money, you can achieve good results," he said.
The grassroots approach has further benefits. Lithuania has excellent doctors, but that is not enough.
"They need equipment, they need further knowledge, they need scientific information, they need cooperation with colleagues and training courses. This can be provided by this cooperation," Sadzius added.
The details of the programmes are now being worked out and implementation should start at the beginning of 2008. Switzerland is optimistic about the future.
"We want to produce winners," Fust said.
swissinfo, Julia Slater in Lucerne
The ten countries that joined the European Union in 2004 are (in order of population size):
Poland, the Czech Republic, Hungary, Slovakia, Lithuania, Latvia. Slovenia, Estonia, Cyprus and Malta.
Switzerland is not a member of the EU, but has a series of agreements with it.
As part of these agreements it agreed to release SFr1 billion to help the countries of the enlarged EU.
The Swiss people accepted the disbursement in a referendum in 2006.
Since the fall of the Communist regimes in eastern Europe Switzerland has spent nearly SFr3.5 billion on cooperation projects there.
Switzerland is to decide shortly on its contribution to Bulgaria and Romania, which joined the EU in 2007.