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What is the EU’s added value in supporting the private sector for development?

Input for the European Parliament Development Working Group consultation on the Role of the Private Sector in Fostering Sustainable Development

06-03-2015

Byiers, B. 2015. 'What is the EU’s added value in supporting the private sector for development?' (Presentation, European Parliament). Maastricht: ECDPM

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Key Messages

  • The EU’s potential value added relates to its economic scale, its role as the main provider of ODA in the world, and its network of institutions.
  • EU institutions supporting both the developing country private sector and EU businesses in investing in developing countries need to be better linked and coordinated for the EU to reach its full potential value added.
  • Working more with the private sector requires a change in instruments, approach and a different mindset about development

At a recent workshop The Role of the Private Sector in Fostering Sustainable Development‘ organised by the European Parliament’s Committee for Development, ECDPM’s Bruce Byiers gave a presentation. 

The workshop aimed to address the issues of what is the EU’s added value in supporting the private sector? Further, how can this be complementary to the actions already carried out and partnerships established by Member States?

Key Challenges & Recommendations 

Challenge #1
EU institutional operating mechanisms: Issues of institutional linkages and capabilities, additionally, internal capacities and coordination

Recommendation #1
The EU should establish coordination mechanisms to facilitate inter-institutional coherence and cooperation

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Challenge #2
Business interest: by both EU businesses and developing country firms

Recommendation #2
The EU should focus on a facilitating role, based on key development principles and building on domestic initiatives within the EU and developing countries

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Challenge #3
EU Member States interest: national objectives vs. EU private sector and the risk of duplication of existing MS actions

Recommendation #3
The EU should favour coordination and exchanges of information (on opportunities, practices, modalities, monitoring) and contribute to set commonly agreed guiding principles (and possible operational framework)

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Challenge #4
Ownership: Partner countries’ desire to receive EU investments 

Recommendation #4
The EU engagement should build on domestic initiatives and facilitate political engagement to foster a better pro-development business environment

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Economic transformation and job creation is increasingly on the agendas of developing countries. Challenges remain for EU institutions relating to operating mechanisms, but also with deeper questions of: 

  • How EU public money should engage with firms from its Member States?
  • How to best tailor engagement to promote effective development impact?
  • How to avoid capture by vested business interests?

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Photo Courtesy of the World Bank

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Economic Transformation and TradeBusiness and DevelopmentEU Development Policy and PracticePresentationsPrivate sectorAfrica