News & Events

04 September 2014

The private sector, remedy for development cooperation?

Development cooperation can make a significant contribution to equality of opportunity, said the Austrian minister of foreign affairs, Sebastian Kurz, taking part in the conference organized by the Austrian Development Agency in Vienna.

The private sector accounts for about 90 percent of jobs in developing countries and in this way is an important partner in the fight against poverty. But is it enough to strengthen the private sector in order to achieve the sustainable development of a country? Economic and development experts, invited by the Austrian Development Cooperation, discussed in connection with this issue on Tuesday in MuseumsQuartier in Vienna.

"We have learned that development targets are consistently achieved above all where the economy interacts with development," said Martin Ledolter, managing director of the Austrian Development Agency (ADA) in his greeting speech. It is understood that the private sector is no panacea for everything, he said. "It is part of the problem and part of the solution," said Ledolter. But only a well-functioning private sector can provide more jobs and better.

Vocational education improves prospects for the future

"For me it is very important that the education of young people in our partner countries is improving," said Foreign Minister Sebastian Kurz in his opening speech. "Together with governments and other partners in the respective countries, we care for young people to gain better chances in the labor market and thereby have positive prospects for the future".

Development cooperation can provide an important contribution here for more equal opportunities, added the minister. "Austrian expertise in professional education is recognized and demanded worldwide. Incorporated in the educational systems of the respective countries, Austrian development assistance contributes as a training model in countries like Moldova, Albania or Mexico, which in addition to theory includes practice too. Austrian companies which produce abroad benefit from this and in particular the people in the above-mentioned countries," explained further foreign minister, Sebastian Kurz.

Mobilize resources in Kosovo

"Through the combination of the development cooperation with the private sector, new resources are mobilized. This can be seen very well in the Kosovo example: additional capital, competence and knowledge," said Kujtim Dobruna, chairman of the Economic Initiative for Kosovo (ECIKS). Austrian Development Cooperation (ADC) supports the small Balkan country for years in the construction and expansion of higher education and professional but also in areas such as rule of law, rural development, and the private sector.

Private sector development: The man in the spotlight

Private sector development is crucial for further development success, highlighted Helmut Asche, development expert and university professor of politics, economy and society in Africa. "The donor community has left a huge gap here and so far has not decided whether the partner countries should support or hinder the development of the industry," said Asche in critical tone.

"The private sector needs to understand that production is not everything," warned Monica Kemperle of the Federation of Trade Unions IndustriALL Global Union. Responsibility is needed from manufacturers and about the way people finance their lives.

"There are still nevertheless good examples of how the sector can contribute to create better working conditions," said Kemperle. "The agreement for fire protection for the clothing industry in Bangladesh has had a real impact on the workplace-safety relationship. Participation of workers’ representatives has a crucial role here," said the expert.

Dobruna: The task of economic institutions is to create conditions for a sustainable development

ECIKS's chairman, Kujtim Dobruna, is satisfied with the course of this debate. "I was pleased to be part of the discussion about the coordination of international development assistance with the potentials of private sector, at a conference organized by the Austrian Development Agency, which was also attended by Foreign Minister Sebastian Kurz," said Dobruna for

"I pointed out that it is the duty of economic institutions to create conditions for a sustainable and inclusive economic growth by focusing on their basic tasks, such as the protection of private property, the creation of a fair judicial system that guarantees rule of law and contract enforcement, facilitates market entry of young entrepreneurs, eliminates monopolistic practices, etc.

I also said that development reforms should seek to ease the operation of the private sector rather than impede it. This requires, among other things, the establishment of a proper broad public-private dialogue which stimulates critical thinking, open debate, and the professional evaluation of challenges and of possible solutions.

I reiterated the recommendation that after new Kosovo government takes power, the focus should be on drafting an inclusive economic plan that above all provides guidance for ways to mobilize the potentials of the private sector," concludes Kujtim Dobruna, chairman of ECIKS.

APA (OTS) & 

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