World Bank Group President Jim Yong Kim has started a conversation about development and the private sector on Oxfam’s blog.
The evolving discussion isn’t so much about whether to harness the private sector to cut poverty, but how to do it.
In an Oct. 28 blog post, Kim said the Bank needs to work with many partners to help meet the goals of ending extreme poverty and boosting shared prosperity. Private sector investment “is needed to stretch scarce development resources.”
“Engaging the private sector is not about how we feel about business; it’s about how high our aspirations are for poor people. If we rely only upon foreign aid, then our aspirations are far too low.”
Working with the private sector in the context of the Bank Group’s social and environmental standards helps protect the interests of the poor, Kim added.
In a Dec. 2 response, Oxfam’s Winnie Byanyima and Raymond Offenheiser agree the private sector has “great potential to pull people out of poverty,” but say the Bank “must ensure it has robust accountability mechanisms in place.”
The two Oxfam leaders caution that the “limitations of the private sector must not be underplayed.”
“To channel resources and economic growth to pro-poor ends, the realities of power and marginalization must be acknowledged and tackled, and the bank’s interventions should not entrench power balances already in favor of the influential,” they say.
“Together, we must make sure that private sector firepower is harnessed to address global poverty.”
Want to join the discussion? Check out the dialogue and weigh in here.