March 2006, GTZ | German Federal Ministry for Economic Cooperation and Development (BMZ)
The German Federal Ministry for Economic Cooperation and Development (BMZ) has commissioned a project for the design of innovative tools for private sector development to be incorporated in the assistance programmes of partner countries. Within this broader objective, the specific purpose of this paper is to elaborate an integrated approach for private sector development in post-conflict reconstruction and reintegration programmes. Economic development in post-conflict environments is a broad subject. Not least due to the facts that no two conflicts are entirely the same and there remains considerable scope for what constitutes an appropriate economic development strategy under normal circumstances. As a result, this paper is at serious risk from the ‘one size fits all’ criticism that haunts much of development policy making. Bearing this in mind, as these fields are increasingly scrutinized in a more systematic way, some patterns and emerging. Readers are expected to exercise their own best judgement in deciding if various parts of the analysis conform to there own experience and circumstances.
This paper develops a framework for private sector promotion in post-conflict environments. It begins by analysing the evidence that draws the link between economic development and conflict. This is followed by an encapsulation of current trends in economic development. The purpose is to establish the broader range of private sector development options under normal circumstances. Post-conflict conditions are then examined to narrow down the field of potential interventions. This includes a brief survey on current approaches to emergency aid, reconstruction and reintegration programmes. The resulting framework for private sector development incorporates the intersection of short-term reconstruction processes and long-term economic development strategies.
The suggested framework is built around four pillars and an overarching component. The pillars include:- Strengthening private sector participation in infrastructure reconstruction;
- Specific interventions for private sector development according to the country context;
- Improving the financial sector; and,
- Strengthening vocational skills training.
