How silver-tongued multinationals can win trust in development circles

Written by Jonathan Glennie, writer and researcher on international development and co-operation and research associate at the Overseas Development Institute in London and at the Centro De Pensamiento Estratégico Internacional (Cepei) in Bogotá in the Guardian’s Poverty Matters blog

“The increasing emphasis placed by some on the role of “the private sector” is a growing source of tension in global development debates.

The term, which covers such a wide range of operations, is sometimes worse than useless, fuelling a perhaps deliberate ambiguity about what is being discussed. In reality, the debate concerns multinational business and international finance – I am yet to meet an opponent of support for small and medium-sized domestic firms.

On the one hand, many Organisation for Economic Co-operation and Development governments are gravitating towards an increased focus on the role of the international private sector in development for three main reasons. First, as a way to make up shortfalls in overseas development assistance (ODA), which is wrongly used to conflate the different characteristics of public and private money. Second, they see ODA as a means of supporting their companies’ chances of securing overseas contracts, not necessarily by tying aid, but by opening up opportunities and contacts. And third, many people are instinctively pro-private sector – based on their training they see business as more often the answer than government.

Global businesses, unsurprisingly, are supportive of these instincts and there is a growing cadre of friendly businessmen whose job it is to attend conferences such as the one that has just finished in Mexico, emphasising the importance of business for growth.

On the other hand, contrary voices, especially from civil society and the more left-leaning UN bodies, express their concern over the direction of the debate, sometimes engaging in forceful campaigns against multinational companies and their failure to live up to basic social and environmental standards. When a private sector spokesperson argues that the private sector is crucial for development and job creation, some in civil society recoil amid concerns that this is code for less regulation and better tax breaks.

But just as the lines are being redrawn between two apparently conflicting sides, the irony is that, in some ways, the debate is already over.”

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