Private Sector Role in Development

In many developing nations, gaps in service provision deprive large segments of the population from access to healthcare, education, electricity, water, sanitation, and other essential services. As the international development community aligns around the 2030 Sustainable Development Goals (SDGs), it has become increasingly clear that public resources alone will be insufficient to meet the scale of investment required in infrastructure and service delivery systems. Countries need sustainable solutions – both environmentally and financially.  By deploying market-based approaches that deliver appropriate, affordable, and environmentally sustainable products and services, the private sector, with its emphasis on efficiency and scale, is well positioned to help meet these challenges and reduce countries’ reliance on public debt and ODA. Unlike the Millennial Development Goals (MDGs) before it, the SDG agenda explicitly recognizes the critical contributions of the private sector and positions business as co-equal partners with government and civil society.

    

GivingWorks has helped clients address the opportunities and challenges associated with private sector contributions to development from multiple angles. 

As the International Finance Corporation (IFC) prepared to launch its strategy for supporting market-based solutions at the base of the economic pyramid (BoP), we conducted an initial stocktaking of financial and technical assistance from bilateral and multilateral development institutions and social investment funds. GivingWorks articulated the key business needs and complexities in BoP markets, developed an overview of key actors’ intervention strategies, and identified opportunities for IFC engagement.

At country level, we supported a World Bank project in Zambia to enhance the competitiveness of three key livelihood-generating industries: cattle, tourism and copper. Working closely with Bank counterparts, GivingWorks synthesized key insights from technical research papers on the three industries as well as the political economy and business environment in Zambia. These findings, along with industry stakeholder workshops co-facilitated by GivingWorks, formed the analytical foundation for challenge competitions that elicited innovative solutions to identified challenges.

We have worked with the World Bank, through several engagements, to better leverage the impact of social enterprises, which often employ hybrid private- and social-sector business models and are an important source of innovations to overcome delivery constraints in low income countries. First, we assessed the performance of the Bank’s Development Marketplace competition – initially structured as a venture capital fair – and identified ways to retool the strategy as the needs and funding landscape for social entrepreneurs evolved over time.  We also developed a strategic framework around non-state service provision more broadly and identified opportunities to leverage the Bank’s core strengths to support entrepreneurship growth, promote knowledge sharing, and improve enabling policies.    

We also provided strategic support to the Inclusive Business Action Network (IBAN), a German-funded initiative to help inclusive businesses – companies with profitable business models that integrate the poor as customers or as part of the value chain – to scale up operations. GivingWorks conducted an in-depth analysis of stakeholder needs and existing support providers, and developed a new strategy with two key pillars: 1) a peer learning and exchange network targeting established IB companies; and 2) an online knowledge and learning platform serving a broad community of Inclusive Business stakeholders.

Most recently, we have supported the World Bank Group to frame a strategic dialogue on leveraging private investment in infrastructure in the context of WBG’s broader Maximizing Finance for Development agenda.

© 2020 GivingWorks Inc. 

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