The EU has increased its focus on Public Private-Partnerships (PPPs), with a renewed approach to private sector engagement for development, through promotion of a multi-stakeholder agenda that is both market-based and inclusive in its outlook.
The European Commission has prepared a communication called ‘A Stronger Role of the Private Sector in Achieving Inclusive and Sustainable Growth in Developing Countries’. The document structures the relationship between the European Commission and the private sector and it follows a previous communication document from 2011 called ‘Agenda for Change’.
The Commission argues that by supporting existing PPPs and facilitating the creation of new PPPs -through building capacity in local institutions, and by fostering the implementation of innovative, catalytic and patient financing mechanisms for Small and Medium Enterprises - progress in all sectors will amplify development by eradicating poverty at its source.
Yara was one of the few companies invited to participate in all the consultations that took place in Brussels and all of our ideas were reflected in the document. The European Commission document recognizes the private sector as an important actor for development and maps creative ways to bring higher levels of responsible private sector investments on board, mixing their cooperative efforts with a private, investment-driven approach.
“The reason to participate was that we think it is very important the link to the role of the financial institutions and that the EU use its regional financing facilities to leverage private sector investments for development through PPPs. The lack of patient capital, high interest rates or no access to finance at all for small and medium sized enterprises in agriculture - as well as the need for smart insurance and risk reducing finance for smallholders - are some of the most important challenges today,” says Natalia Federighi, Yara’s Director of Public Affairs and Institutional Relations.
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“The new strategy has a timely arrival, as we approach the date for MDG (Millennium Development Goal) compliance and the launch of the post-2015 development agenda,” Natalia says.
“We have been in touch with the European Commission’s Directorate General for Development for many years now,” Natalia continues. “Furthermore, we have just organized, through Friends of Europe and Grow Africa, a high level dinner during the EU-Africa Summit of Heads of State and Government. There our CEO and President Jørgen Ole Haslestad could state our position clearly to Commissioner of Development Andris Piebalgs and other senior participants.“
“The communication clarifies the partnership agenda - defining how this will be different and complementary to the previous approach,” she explains. “Before the private sector was seen only as contributing to inclusive and sustainable growth in developing countries, but not as also contributing to the achievement of common development goals, directly or through partnerships.
“There is a general and growing private sector interest to invest, but there is also the need to create the right, enabling environment to facilitate partnerships which will realize the sustainable transformation of food and agricultural systems.”