The Swiss Agency for Development and Cooperation (SDC) announced on Wednesday that it was now prepared to hand over the money.

But only on condition that Richner agrees to sign an accord with the Cambodian government within the next three years.

“As soon as the agreement is signed [between Richner and the Swiss government], we will release the money,” said Harry Sivec, spokesman for the SDC.

“We are anxious that the funds should be handed over as quickly as possible.”

Peter Rothenbühler, a board member of the Kantha Bopha Foundation, which manages the hospitals, said both sides were confident that a solution would be found by the end of July.

But he warned that any compromise would need Richner’s approval.

Government corruption

The paediatrician has previously refused to cooperate more closely with the Cambodian authorities because of concerns over government corruption.

“The health ministry is corrupt… and it is incumbent on our foundation not to sign a contract which would see the money we receive flowing through the hands of ministry officials,” he said in a letter to the Swiss foreign minister, Micheline Calmy-Rey.

The SDC maintains that all projects which receive funding from the Swiss government must fulfil certain criteria and “play by the rules”.

Richner was named “Swiss of the Year” in 2003 in recognition of his work operating children’s hospitals in Cambodia, which are mainly funded through private donations.

Richner raises money through his work as a cellist. Over the past ten years, his concerts have brought in over $100 million (SFr125 million), mostly from Swiss donors.

The SDC says it has contributed almost SFr17 million to the foundation since 1994.

swissinfo with agencies