Global Development Goals
A new set of 17 Global Goals for sustainable development (SDGs) emerged in the context of the 2030 Agenda for Sustainable Development, in 2015. They advocate an integrated approach to economic, social and environmental issues, and put great emphasis on a development model where the private and public sectors have complementary roles in supporting inclusive and sustainable growth. They also represent a major shift in the international community’s strategy to achieve these Goals by highlighting private business activity, investment and innovation as major drivers of productivity, inclusive economic growth and job creation. The core mandate of DFIs compels them to contribute to global development, especially poverty eradication, and climate goals.
The private sector’s role in reducing poverty
The private sector is now broadly acknowledged by the international development community to be a key driver of poverty alleviation. It generates a positive impact on economic growth, job creation and living conditions, the latter through increased access to health and education, as well as essential goods and services. It also stimulates entrepreneurship and contributes to the diversification of the economy. Lastly, it enables governments to increase tax revenues, thus helping them provide more and better public services.
Many of the countries that have produced the most significant reduction in poverty have followed a model where jobs become the major channel through which economic growth uplifts the poor. More than nine in ten jobs are created in the private sector in low and lower middle income countries, and each new job lifts five people out of poverty (Source: IFC Job Study Report).
Over the next fifteen years, with these new goals that universally apply to all, countries will mobilize efforts to end all forms of poverty, fight inequalities and tackle climate change, while ensuring that no one is left behind.
Addis Ababa Action Agenda on Financing for Development
Highlighting private business activity, investment and innovation as major drivers of productivity, inclusive economic growth and job creation.
Global action plan to put the world on track to avoid dangerous climate change. The agreement will also have significant implications for climate finance.