Policy Dialogue on Private Sector and Development Financing

Sustainable national development is a collective effort that requires the involvement of the Government, the private sector and civil society of which NGOs are the more formalized institutions.

11th TANGO Policy Dialogue

11th TANGO Policy Dialogue

National strategies for sustainable development, as advocated for by Agenda 21 as well as the World Summit for Sustainable Development and the Commission on Sustainable Development seek to build upon and harmonize the various economic, social and environmental policies and plans that are operating in a country. This involves coordination and integration of relevant policies and actions in multiple sectors, as well as adequate monitoring and review mechanisms, with the participation of government actors, civil society and the private sector.

Thus, partnership which is regarded as a fairly new innovation in development discourse and practice is considered as a suitable approach in sustainable national development. The general term Public-Private Partnership commonly known by its acronym PPP, P3 or simply partnership is a relative idea. However, the concept invoked the idea of collaboration between public and private sector. J.M. Brinkerhoff (2002) characterized an ideal type partnership as a dynamic relationship among diverse actors, based on mutually agreed objectives, pursued through a shared understanding of the most rational division of labor based on the respective comparative advantage of each partner. Partnerships are pursued as means to increase efficiency as various Partners pool resources, skills and expertise to achieve a common objective. Partnerships have become an emerging trend in the last decades in the development process particularly in public service delivery. It emerged in the 1990s as a derivative of the privatization movement that dominated much of the 1980s in the wake of the demise of the welfare state particularly in advanced countries.

Most of the current literature on partnership focuses mainly on the perspective of private-private partnership as profit venture, However, Nonprofit partnership as supplement to state government; is crucial in public goods provision where preference of the citizenry are heterogeneous and are constrained by consideration of equity and bureaucratic procedures.

The idea of a partnership between the civil society, particularly NGOs and the private sector is still a relatively new area even though there are several major business firms providing tremendous resources to development organizations around the world. By establishing foundations or directly supporting development initiatives, the likes of Bill and Melinda Gates Foundation, the Rockefeller Foundation or Goldman Sachs have been notable donors to such issues as HIV/AIDS, malaria, maternal mortality or such organizations as the Global Fund, the United Nations or the African Union.

At home in the Gambia, the private sector is constantly providing goods and services worth millions of dalasi to various sectors of the population as well as to the government in what is claimed to be a fulfillment of their corporate social responsibility. In incidences such as floods, bush fires and rainstorms, as well as national celebrations the Gambian private sector has never been found wanting in providing much needed relief to communities or supporting the government.

NGO – Private Sector Partnership
TANGO is of the view therefore that the Gambian private sector has the potential to boost national development even further; not if, but when the business community partners with the NGO community in a more organized manner to deliver development to our people. It is in light of this realization among others that the NGO community is keen to formally engage the business community on the issue of national development financing from local sources. Most, if not all NGOs, big or small in the Gambia depend on external sources for their programs and interventions. The question has always been raised as to what capacity has the Gambian private sector to support local development organizations. NGOs in the Gambia are basically involved in service provision in all sectors and regions of the country. These range from providing education, health and food to equipping communities with knowledge, skills and tools for better environmental management, income generation, self-employment and higher agricultural production among others. These services in fact also extend to public sector workers from the central to local levels as well as the business community itself. For example, several SMEs have been trained by NGOs on various business development strategies and techniques, among others.

Furthermore, the private sector stands to benefit from development outcomes initiated and promoted by NGOs. A healthy and well educated citizenry is crucial to the existence of a vibrant economy, while the efforts of development organizations to alleviate poverty and improve income of the local population can ultimately stimulate growth of the private sector.

NGOs offer good business for the Private Sector
It must be noted that NGOs also serve as a golden goose for the business community, significantly. Through buying goods and services of the business community at market prices, NGOs are therefore keeping the private sector in business at minimal cost to the former. For example, funds for NGOs are lodged with commercial banks for short to long term periods which attract charges while the banks are at liberty to invest those funds to make more profits. Secondly, in running their programs and daily operations, NGOs routinely buy goods and services from petroleum companies, insurance companies, vehicle selling companies, hotels and restaurants, GSM companies, media and print companies as well as supermarkets, stationery and ICT firms. The volume of business being delivered to the private sector from the NGO community therefore is quite substantial and critical for the survival of these companies. Yet, TANGO and the NGO community have noted that the response of the private sector to the development community is negligible by all accounts! This is what TANGO seeks to change in the interest of national development.

Development Financing
TANGO is aware of the primary pre-occupation of the private sector, which is to make profit. But it is in the business of making profit that the private sector is empowered to make investments in various forms to raise more profits as well as to spur national development. As NGOs possess the necessary policy and development expertise and experience, directing corporate social responsibility towards development organizations will ensure efficiency in achieving development objectives. In the partnership that TANGO is seeking with the private sector therefore is one that recognizes the nature of these two parties, as well as the potential and opportunity that lies therein for economic and human development in the Gambia. In essence TANGO looks up to the Gambian private sector to offer goods and services in the following areas:

Capacity building, i.e. to empower development workers with knowledge and skills on a wide range of fields including ICT to reinforce efficiency and effectiveness in the delivery of development goods and services to communities;

Resource mobilization- i.e. for the private sector to increase support and collaboration with NGOs in promoting and delivering development to the Gambian populace by  offering financial and material support necessary to ensure sustainability and capability of NGOs;
Access and Influence; i.e. how the private sector can create more opportunities as well as serve as voice and platform in expanding and influencing the public policy space to ensure development effectiveness. Concessions or waiving of transaction fees or charges are all opportunities that will further empower NGOs.

In this partnership therefore, and in order to maximize the utilization of these resources, NGOs should be able to offer the following:

Long-term commitment to communities, i.e. NGOs will be able to ensure sustained presence and engagement with communities to empower them to undertake their own development, hence lasting and sustainable development;
Knowledge development – what works, what does not, i.e. NGOs will ensure that development is guided by evidence and aimed at producing results and impact that changes lives positively;
Community trust, i.e. NGOs will stick with communities to build their capacity and resilience for self-reliance and development;
Expertise, i.e. through research and sustained engagement NGOs have vast experience and expertise in community development which will serve as both a guide and result of the sustained engagement that will be engendered with the support of the private sector.

Policy Dialogue

In the light of the foregoing, TANGO in partnership with its members with funding from ActionAid International The Gambia (AAITG) and the African Capacity Building Foundation (ACBF) will convene the first ever consultative forum between the NGO community and the private sector on 6 May 2015 at TANGO Conference Hall starting at 9.30am sharp (No Gambian Time).

TANGO recognizes that philanthropy for development is producing results in other countries because, not just for the amounts of resources provided by the private sector, but also there is a favorable legal and policy environment that encourages philanthropy. For example, in many countries, the private sector enjoys tax concessions or rebates in support of philanthropy. Concerned with this issue, the policy dialogue will therefore involve the Ministry of Finance and Economic Affairs and the Gambia Revenue Authority as the policy makers and implementers in that area in order to consider the need to review taxation issues so as to support development funding. The discussions therefore will focus on the key issues of:

Opportunities for development financing from the private sector;
Legal and policy reforms necessary to support development financing in the country;
Identification of development needs and challenges and how private sector can support;

The policy dialogues will seek to set principles and standards that will guide the NGO-Private Sector Partnership for National Development Financing. The keynote speech will be delivered by Malamin Sonko, former Country Director Action Aid International The Gambia and now a leading development consultant in the Gambia, followed by discussants from the public, private and civil society sectors.

All are invited.

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About TANGO Policy Dialogue Series

The TANGO Policy Dialogues is a bi-monthly awareness creation and advocacy forum aimed at bringing together policy and decision makers, development workers, researchers and the general public to discuss key pertinent national development issues. It is convened under the auspices of a four-year project, ‘Support to Human and Institutional Capacity of TANGO’ funded by the African Capacity Building Foundation (ACBF). The project seeks to build the capacity of TANGO and NGOs to more effectively participate in public policy making processes and enhance national development.