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Development Co-operation Report 2016

The Sustainable Development Goals as Business Opportunities

image of Development Co-operation Report 2016

The face of development has changed, with diverse stakeholders involved – and implicated – in what are more and more seen as global and interlinked concerns. At the same time, there is an urgent need to mobilise unprecedented resources to achieve the ambitious Sustainable Development Goals (SDGs). The private sector can be a powerful promotor of sustainable development. Companies provide jobs, infrastructure, innovation and social services, among others. Increasingly, investments in developing countries – even in the least developed countries – are seen as business opportunities, despite the risks involved. The public sector can leverage the private sector contribution, helping to manage risk and providing insights into effective policy and practice. Yet in order to set the right incentives, a better understanding is needed of the enabling factors, as well as the constraints, for businesses and investors interested in addressing sustainable development challenges.

The Development Co-operation Report 2016 explores the potential and challenges of investing in developing countries, in particular through social impact investment, blended finance and foreign direct investment. The report provides guidance on responsible business conduct and outlines the challenges in mobilising and measuring private finance to achieve the SDGs.  Throughout the report, practical examples illustrate how business is already promoting sustainable development and inclusive growth in developing countries. Part II of the report showcases the profiles and performance of development co-operation providers, and presents DAC statistics on official and private resource flows.  

 

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Germany

Germany uses public development finance to leverage engagement and investment from the private sector for sustainable development, seeking to build synergies among the various German stakeholders at home and in partner countries (OECD, 2015). It mobilises a wide range of instruments as part of its financial co-operation – from concessional loans to risk capital provision and guarantees – which are extended by KfW, Germany’s development finance institution. In its financial (KfW) and technical co-operation (GIZ) activities, Germany has also developed some innovative approaches for engaging with developing country, German and international companies. For example, Germany has set up a Trade Policy and Trade Promotion Fund that aims at building the capacities of partner country decision makers and non-state actors to develop and implement coherent and comprehensive strategies for the promotion of trade and investment. In addition, the fund promotes the cross‑linkage of state and non-state stakeholders so that they can jointly develop and implement trade strategies.

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