Ministers from around the world back private sector investment-for-development policies

​Investment, trade and development ministers from 29 countries and heads of international organizations made a decisive call for the ratcheting up of private sector investment to deliver the sustainable development goals (SDGs), being set to steer development efforts from 2016 until 2030. The calls were made at a roundtable that concluded the World Investment Forum 2014 in Geneva on 16 October.

The high-level meeting urged for the SDGs to contain concrete provisions on the means to implement them, acknowledging that official development assistance and public resources would not be sufficient to achieve the ambitious set of goals, particularly in least developed countries.

The outcome of the meeting will be formally forwarded to the United Nations General Assembly and will feed into the Conference on Financing for Development next year in Addis Ababa, and ultimately into the goal-setting Conference on the Sustainable Development Goals in New York in September 2015.

Opening the meeting, UNCTAD Secretary-General Mukhisa Kituyi said a stronger role for private-sector investment would be "indispensable" if the sustainable development goals were to be met.

"We are confronted with a huge annual investment gap of $2.5 trillion in sustainable development sectors," Dr. Kituyi said. "No matter what form the sustainable development goals take, they will require substantially more private investment, working in concert with public investment… This is the phenomenally challenging task before us."

Amir Hossain Amu, Minister of Industries, Bangladesh, noted that intervention at the global level would be "crucial to ensure that non-public resources flow to marginalized countries".

Acknowledging the key role of the private sector to help generate productive capacity and give impetus to job creation and economic growth, ministers considered policy frameworks and strategies that would propel the private sector to do the heavy lifting to deliver the development goals. The discussions were informed by UNCTAD's World Investment Report 2014, which proposes an "action plan" for investing in the SDGs.

Lakshman Yapa Abeywardena, Minister of Investment Promotion in Sri Lanka, said: "Private financing can be harnessed towards sustainable and long-term investment through an enabling environment that provides the right incentives. An effective strategy in this context has to take into account all aspects of sustainable development and bring together the different modes of traditional financing."

Other elements highlighted at the meeting as fundamental to delivering sustainable investment included:

• ensuring that investment policies are in line with overall sustainable development strategies and specific strategic priorities (such as youth employment, widening the skills base, women's empowerment, rural development, development of natural resources, industrial transformation, participation in global value chains, and developing alternative energy sources);
• ensuring a balanced mix of public and private funding;
• building absorptive capacities, including by improving access to finance for local small and medium-sized enterprises;
• putting in place effective institutions and good governance;
• facilitating investment and business by simplifying administrative procedures;
• balancing investor rights with investor obligations, and giving a more prominent role to responsible business practices and corporate responsibility;
• moving towards international investment policies that effectively attract investment and that safeguard space for policy making in the public interest, while supporting a sound investment climate.

A number of ministers expressed their views about policy challenges arising from greater private sector involvement in SDG-relevant sectors, including on protecting public interests through regulation; ensuring accessibility and affordability of services for all; and securing complementarity between private and public investment. Ministers from several countries related experiences of successful approaches to resolving these dilemmas, including through the approach of public-private partnerships to ensure complementarity.

Ahmed Abitew Asfaw, Minister of Industry, Ethiopia, said: "We have listened, at this Forum, to a number of private sector mechanisms that would enhance their participation in achieving the sustainable development goals. We welcome and look forward to the concrete translation of these mechanisms."

The meeting was chaired by Lilianne Ploumen, Minister for Foreign Trade and Development Cooperation of The Netherlands, and Rob Davies, Minister of Trade and Industry of South Africa.

NOTE: Also speaking at the roundtable were ministers from The Bahamas, Bhutan, Cameroon, Central African Republic, People's Republic of China, Costa Rica, Croatia, Curaçao (The Netherlands), Dominican Republic, Ecuador, Guatemala, Kyrgyzstan, Lao People's Democratic Republic, Lesotho, Madagascar, Mali, Niger, Nigeria, Seychelles, Sri Lanka, Sudan, Switzerland, Tunisia, United States of America, and Zimbabwe. Representatives of the Organisation for Economic Co-operation and Development (OECD) and the Multilateral Investment Guarantee Agency (MIGA) of the World Bank also spoke.