Transcript The Private Sector and its role in Development

The Private Sector and its role in
Development - A trade union
perspective
TUDCN – Sao Paulo, March 2014
What is it?
• direct recipient of public aid, including ODA
– for their investments and activities (subsidies and loans);
• contractor in implementing aid projects
– through traditional public procurement procedures);
• a commercial and/or financial partner within a publicprivate partnerships
– or through blending commercial loans with aid grants;
• provider of aid-equivalent development resources
– private philanthropic foundations and corporate
donations); and/or
• facilitator in networking and policy making processes
– through business forums and networks.
ODA (USDbn)
200.0
180.0
IX. Unallocated /
Unspecified
160.0
VIII. Humanitarian Aid
140.0
VII. Action Relating to
Debt
120.0
IV. Multi-Sector /
Cross-Cutting
100.0
80.0
III. Production Sectors
60.0
II. Economic
Infrastructure &
Services
I. Social Infrastructure
& Services
40.0
20.0
0.0
2006
2007
2008
2009
2010
2011
2012
ODA, 2006 base 100
300
I. Social
Infrastructure &
Services
II. Economic
Infrastructure &
Services
III. Production
Sectors
250
200
150
IV. Multi-Sector /
Cross-Cutting
100
50
VII. Action Relating
to Debt
0
VIII. Humanitarian
Aid
2006
2007
2008
2009
2010
2011
2012
The drivers
– Business groups as “equal partners” of
government
– Leveraging and tied aid
– Inclusive business
“Unleashing the Power of Business”
• Semantic shift from
– Private sector development ("contribute to
sustainable development“), to
– Private sector for development ("true partner in
development“, “systematic engagement of business”,
“a two-way street”, “Development is about the
business of business”
• Stating the obvious
– “Business is operating as a partner in development
when: Business aligns its investments with a country’s
development priorities Social and environmental
development”
Methodology & narrative
• Micro necessarily applies macro
– “how to”, case study approach, “pockets of good
practice”
• Subjective & disconnected from normative
approach
– Subjective, “vision, “beliefs”, "cultural divide"
between business and government
• “alignment”
– “achieve a ‘Level 4’ society in which public and private
interests are more strongly aligned and in which
collaboration across the sectors becomes the ‘new
normal’.
Not about privatisation, but
• “not suggesting in any way a watering-down of the
role of government”, “not a manifesto for
privatisation” but:
• “a call to explore why companies might be
strategically interested in development priorities and
finding ways to engage them much more
systematically through partnership” …
• PPPs & inclusive business
• what kind of employment, and in what fields?
• Water, Health, Energy, Finance
The inclusive business model & PPPs
– To “demonstrate why public private partnerships for
development (PPPD) are usually essential”
– to address “underdeveloped public services, social
challenges, lack of skills, regulatory hurdles, poor
infrastructure, inefficient manufacturing or
agricultural production and limited access to finance”.
– To address “uncertainty” around the idea of business,
through a partnership, appearing to get involved in
delivery of a 'public good’
– Subtle difference between “PPP for D” & “Regulated
PPPs”
Policy Priorities
– Asserting the developmental role of the state
– Upholding a rights-based approach to
development through rule of law & social dialogue
– Holding multinational businesses to account
– Setting standards for aid effectiveness, measuring
impacts and results
– Supporting SMEs and entrepreneurship, tackling
informality
Tax evasion & tax avoidance
• Tax avoidance
– Legalised but « aggressive » tax planning
– reform to intra-group transfer pricing regulation
– mandatory disclosure country-by-country tax
reporting.
• Tax evasion
– illegal
– Global forum standard
– enforcing automatic exchange of information between
tax authorities