Presentation at Camões

Anna Rosengren and Bruce Byiers European Centre for Development Policy

Management

Lisbon, 25th March 2014

Engaging with the Private Sector for

Development

• Brief background – what private sector are we talking about?

• Lessons from other EU Member States - Institution- Instruments - Challenges

• The Political Economy of PSD

• Implications for Portugal

Overview of presentation

Page 2ECDPM

ECDPM Page 3

• Private sector developmentOld agenda: domestic, enterprise growth, value-addition, exports, access to credit, business climate, firm-level skills, industrial policy etc.

• Private sector investment for developmentNew agenda: international, partnering with developed country firms, offset risk, link producers & suppliers

• Private sector finance for developmentInput side – promote and leverage private sector finance

Three related but distinct agendas :

ECDPM Page 4

Private Sector Development… developing country businesses were able to startup and expand

Private Investment for Development… there was a way to encourage more inwards investment to link with the local private sector

Private Finance for Development…there was a way to bring in more finance for public (or private) investments

Assumptions – development would happen if only…..

ECDPM Page 5

• United Kingdom - The Engine of Development, 2008

• Germany - Forms of Development Cooperation involving the Private Sector, 2011

• Sweden - Collaborations with the private sector, 2011

• The Netherlands - The Good Growth Fund, 2013

Lessons from other EU Member States

ECDPM Page 6

• Collaboration between Ministry of Employment, Ministry of Foreign Affairs and Ministry of Education and Culture + 70 teams abroad

• Activities - Services supporting the internationalisation of business- Influencing the external environment - promoting FDI in Finland- Promoting Finland’s country brand

Team Finland

ECDPM Page 7

• Donor-led models

• Coalition models

• Business models

• Business-CSO models

• CSO-led models

Partnership models

ECDPM Page 8

Mandate and motivation for actors

ECDPM Page 9

• Donor-led - Challenge Funds - Matchmaking facilities

• Multi-stakeholder - Public-private dialogue - IDH - Grow Africa

• Private-led - CSR - Base of Pyramid

PSD Instruments

ECDPM Page 10

Donors • Additionality • Donor attribution • Project-level attribution • Result and impact measurement • Agent selection • Fragile states

Private Sector • Local markets and regulatory challenges • Market distances

Challenges

ECDPM Page 11

• Who leads who and what impact will that have on partnership structures?

- Donor perspective - Private Sector perspective

• The role of national institutions and governance systems.

- Policy and operational perspective - Domestic resource mobilisation

The Political Economy of PSD

ECDPM Page 12

• How to define and understand developmental outcomes?

• Linkages between international investment and the local private sector

• To what degree can we embrace pilot, experiments and failures using taxpayers money?

Other PSD question and issues

ECDPM Page 13

• Alignment with current strategy?

• Portugal’s PSD strategy ( 1 ) extend to more people and better able access to education and health and other basic social services ;( 2 ) create and expand to more people and better conditions , access to employment opportunities and income;( 3 ) foster more and better dialogue and joint action between the public and private sectors in the field of development

cooperation .

• Priority Sector? - Extractives

Implications for Portugal

ECDPM Page 14

Thank youwww.ecdpm.org

www.slideshare.net/ecdpm

Page 15