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The role of business in development
On May 3, I attended a discussion hosted by the Global Economy and Development group at Brookings and the Initiative for Global Development (IGD) Washington, D.C., entitled “The Role of Business in Development: How Private Investment Can Catalyze Economic Growth and Reduce Poverty.” While the Administration prepares a new U.S. global development assistance program, the event focused on the need for greater coordination of U.S. aid, trade and investment programs, and how to effectively work across sectors. The questions that were asked included:
- “How can U.S. development programs best build capacity, unlock capital, supply infrastructure and create an environment for marked-let growth;
- how can companies most effectively contribute to the growth of local enterprises and local employment through their supply chains and investments; and
- what are the specific opportunities and challenges of increasing investment across Africa?”
Daniel Yohannes, Millennium Challenge Corporation CEO, provided the opening remarks, followed by a discussion among three CEO’s (Justin Chinyanta, Chairman & CEO, Loita Capital Partners International LTD, Tim Solso, Chairman & CEO, Cummins Inc., and Chad Holliday, Former Chairman & CEO, E.I. du Pont de Nemours and Company) from the United States and Africa. Kermal Dervis, Vice President and director of Global Economy and Development, moderated the discussion while Jennifer Potter, President and CEO of IGD provided introductory remarks.
From the discussion that followed, it was clear that for any significant global economic development and poverty reduction to occur, it will be essential for the private sector to lead the effort. All of the speakers expressed optimism that it could be accomplished although it will be a long and difficult journey as there are many obstacles. It was emphasized that the private sector needs to “step up to the plate,” have a long term outlook, and that poor countries also must have good governance and an environment conducive for business investment. Two recent publications were made available at the event:
- “A New Strategy to Leverage Business for International Development” authored by Robert Mosbacher, Jr. and published by the Global Economy and Development at Brookings (working paper #4, May 2010), and
- “The Business Case for Foreign Aid Reform” by Initiative for Global Development.