Jakarta. The Swiss State Secretariat for Economic Affairs, or SECO, will provide grants of 65 million Swiss francs, or about $71.8 million, for the next four years to assist Indonesia’s economic development.

On Thursday, SECO renewed its economic development cooperation with Indonesia for 2021-2024 — making it the fourth cycle since the first one in 2009. 

“Over the next four years, SECO will provide at least 65 million Swiss francs in grants to support the new program. Our current engagement in Indonesia includes more than 30 active projects, in collaboration with 15 implementing partners and 10 ministries,” SECO director Marie-Gabrielle Ineichen-Fleisch told an online conference on Thursday.

According to Ineichen-Fleisch, SECO will foster Indonesia's effective public institutions, mainly in urban areas, and empower the local micro, small, and medium enterprises (MSMEs). 

Support for the MSME sector —Indonesia's primary job creation driver— is crucial for the country's economic recovery from the Covid-19 pandemic.

Also, Swiss will help promote sustainability in Indonesia's palm oil supply chains and other export commodities. Indonesia will receive technical assistance to revive its pandemic-hit tourism, among others.

“Indonesia is a priority country for SECO’s economic cooperation, as well as an important market for Swiss companies in terms of trade and investment in Southeast Asia,” Ineichen-Fleisch said.

She highlighted the bilateral trade volume reached a whopping $1.5 billion in 2019. Hundreds of Swiss companies with a total accumulated capital stock of $6.5 billion have also invested in Indonesia and create 50,000 jobs.

“The 2021-2024 program closely aligns with Indonesia’s development plans and builds on SECO’s previous achievements. Our objective is to support Indonesia in becoming a more competitive, resilient, and equitable economy."

Voting on Palm Oil

The partnership's renewal took place at a time when the Swiss referendum is just around the corner.

On March 7, Swiss — as part of the European Free Trade Association (EFTA) — will hold a popular vote on whether the country will proceed with Indonesia-EFTA Comprehensive Economic Partnership Agreement (IE-CEPA).

The partnership will lower import duties on products entering Switzerland. This includes Indonesia's top commodity, palm oil, currently suffering from a massive pushback in Europe. The trade agreement also sparks criticism from anti-palm oil activists.

Farmers' union Uniterre and winegrower Willy Cretegny collected more than the required 50,000 signatures to propose a referendum on the trade agreement, according to Swiss Info. 

Bloomberg also reported a poll held by a Swiss polling firm gfs.bern found 52 percent of respondents supported the trade accord.

With opinions divided, Indonesia said they would respect whatever the referendum result is while remaining hopeful that the Swiss will be on board with the partnership.

"We fully respect the decision of the Swiss people. However, we still hope the IE-CEPA could be accepted,” National Development Planning Minister Suharso Monoarfa said.

“Considering the CEPA will substantially improve market access conditions on both sides, deepen bilateral economic relations in a manner consistent with the objective of sustainable development and further strengthen economic development cooperation,” he added.