What is PSD?

Why PSD?

Pillars of Entrepreneurship

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Private sector investment and poverty reduction

A strong and functioning domestic private sector is an essential element of sustainable economic growth

• Growth of the indigenous private sector has been a key element in countries that have achieved rapid economic development
• By providing employment and income generation opportunities, the private sector can provide a means of poverty alleviation

There is an emerging consensus on the role of the domestic private sector in economic growth

• The Monterrey Consensus (2002) highlights the need to engage the private sector as a prerequisite to poverty alleviation
• The UN’s Commission on the Private Sector and Development (2004) points out that the “savings, investment and innovation that lead to development are undertaken largely by private individuals, corporations and communities”
• The UN Millennium Project Report (2005) recommends that MDG-based poverty reduction strategies include a strategy for promoting the domestic private sector and generating income for poor people

Stimulating the development of a domestic private sector in developing countries, and involving the private sector in achieving broader economic and social goals, is thus becoming a key element of the development agenda

• A number of countries are increasingly committed to private sector-led models of growth – according to the ROAR report, 35 countries undertook PSD work in 2004 alone
• International development institutions are responding to the demand for developing the domestic private sector and for creating the enabling environment that spurs its growth
• The private sector is also increasingly interested in engaging with the development agenda in ways that complement its functioning and objectives
• Civil society organizations are also engaging with private sector development (e.g., WWF, Oxfam)