Lifting people out of poverty and achieving the Sustainable Development Goals, which will be set at the UN Summit in September, is an impossible undertaking without adequate financing. It is becoming increasingly clear that public money alone is insufficient to reach development cooperation objectives. In order to fill the financial gap, donors are working in cooperation with the private sector to implement and finance activities. One approach is to use public finance to “leverage” private sector investment through mechanisms that include Public Private Partnerships (PPPs) and “blending”. In this instance, the main challenge is to ensure that financial resources are used for the benefit of the world’s poorest. This leads to the question of determining which standards of accountability should be applied to the private sector when using public money. How can financial needs be met with mechanisms that deliver for the poor? Addressing these issues is crucial ahead of the Third UN Conference on Financing for Development, in July.
What are the current benefits and challenges of leveraging private finance with public resources and institutions? What kind of principles need to apply so that publicly supported private sector operations contribute to sustainable development? How can governments make sure that they support business operations that comply with these standards? How can the impact of these investments be monitored and measured on the ground?