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UNLEASHING ENTREPRENEURSHIP Making Business Work For The Poor Marta Ruedas, Deputy Regional Director Regional Bureau for Europe and the CIS (RBEC)

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Presentation on theme: "UNLEASHING ENTREPRENEURSHIP Making Business Work For The Poor Marta Ruedas, Deputy Regional Director Regional Bureau for Europe and the CIS (RBEC)"— Presentation transcript:

1 UNLEASHING ENTREPRENEURSHIP Making Business Work For The Poor Marta Ruedas, Deputy Regional Director Regional Bureau for Europe and the CIS (RBEC)

2 1 OVERVIEW The Commission and its Objectives The Commissions Report –Key Messages –Recommendations Implementation

3 2 BACKGROUND AND OBJECTIVES UN Secretary-General Kofi Annan convened the Commission of public leaders, thinkers and chief executives A six-month effort, not aimed at expansive research, but focused on action-oriented recommendations and concrete initiatives to follow up Recognize the importance of the private sector for achieving the Millennium Development Goals by –Unleashing domestic entrepreneurship –Better utilizing private sector capabilities for development Who Task Objectives

4 3 WHO – COMMISSION CO-CHAIRS, plus… CO-CHAIRS The Right Honourable Paul Martin Prime Minister, Canada Ernesto Zedillo Director, Yale University Center on Globalization Former President, Mexico EX–OFFICIO MEMBERS Mark Malloch Brown (United Kingdom) Administrator, United Nations Development Programme Maurice Strong (Canada) Special Adviser to the Commission

5 4 PUBLIC LEADERS & THINKERS, and Eduardo Aninat (Chile) Former Deputy Managing Director, International Monetary Fund Jorge Castañeda (Mexico) Former Minister of Foreign Affairs, Mexico Distinguished Professor of Politics & Latin American Studies, New York University Luisa Diogo (Mozambique) Prime Minister, Mozambique Former Minister of Planning and Finance, Mozambique Peter McPherson (United States) President, Michigan State University C.K. Prahalad (United States) Harvey C. Fruehauf Professor of Business Administration, University of Michigan Business School Juan Somavia (Chile) Director-General, International Labour Organization Hernando de Soto (Peru) President, Institute for Liberty and Democracy, Peru

6 5 CHIEF EXECUTIVES Carleton Fiorina (United States) President and CEO, Hewlett - Packard Company Rajat Gupta (India) Senior Partner Worldwide, McKinsey & Company Anne Lauvergeon (France) Chairman of the Executive Board, Areva Group, President and CEO, Cogema Jannik Lindbaek (Norway) Chairman, Statoil ASA Alan Patricof (United States) Vice-Chairman and Founder, Apax Partners Kwame Pianim (Ghana) CEO, New World Investments Robert Rubin (United States) Director and Chairman, Executive Committee, Citigroup Former Secretary of the Treasury, United States Miko Rwayitare (South Africa) President and Executive Chairman, Telecel International

7 6 OVERVIEW The Commission and its Objectives The Commissions Report –Key Messages –Recommendations Implementation

8 7 FIVE KEY MESSAGES 1. Why the private sector is so important in alleviating poverty Strong expansion in sustainable private sector investment is the main driver of accelerated economic growth, essential for reducing poverty and making rapid progress towards the Millennium Development Goals. 2. Constraints on the private sector in developing countries Domestic private initiative and entrepreneurship, particularly within the small and informal sectors, have enormous potentialbut they are trapped in disabling business environments. 3. Unleashing the potential of the private sector Governments need to create an enabling environment for a competitive private sector to develop. For domestic and foreign players to thrive requires a strong rule of law and a level playing field. 4. Engaging the private sector in development Private initiative driven by market-based incentives has the demonstrated capacity to contribute to important development goals. The private sector, properly enabled, can do substantially more by developing and replicating successful models. 5. Recommended actions To ensure progress towards the MDGs, all stakeholdersgovernments, development institutions, the private sector and civil societyneed to collaborate more effectively and expand the use of private sector capabilities in meeting development objectives.

9 8 WHY THE PRIVATE SECTOR IS SO IMPORTANT IN ALLEVIATING POVERTY MORE PRIVATE INVESTMENT – MORE GROWTH

10 9 COMPONENTS OF THE PRIVATE SECTOR – SEEN AS AN ECOSYTEM Microenterprises Cooperatives Domestic private sector ecosystem Multinational Corporations Large Domestic Enterprises Small-Medium Enterprises

11 10 Widespread informality Few competitive small and medium enterprises Microenterprises Cooperatives Domestic private sector ecosystem Multinational Corporations Large Domestic Enterprises Small-Medium Enterprises CONSTRAINTS ON THE PRIVATE SECTOR Lack of competitive pressure

12 11 INFORMALITY THRIVES IN POORER COUNTRIES Source:World Bank and International Labour Organization

13 12 SMEs BECOME MORE IMPORTANT AND INFORMALITY LESS IMPORTANT AS COUNTRY GDP INCREASES Source:Meghana Ayyagari, Thorsten Beck, and Asli Kunt, Small and Medium Enterprises across the Globe: A New Database (2003)

14 13 RECOMMENDED ACTIONS To ensure progress towards the MDGs, all stakeholdersgovernments, development institutions, the private sector and civil society need to collaborate more effectively and expand the use of private sector capabilities in meeting development objectives.

15 14 FRAMEWORK FOR ACTION 1. In the Public Sphere – Promoting reforms of laws, regulations and other barriers of growth 2. In the Public-Private Sphere – Facilitating cooperation and partnerships between public and private players to enhance access to such key factors as financing, skills and basic services 3. In the Private Sphere – Encouraging the development of business models that can be scaled up and copied and that are commercially sustainable

16 15 OVERVIEW The Commission and its Objectives The Commissions Report –Key Messages –Recommendations Implementation

17 16 BRINGING THE REPORT TO LIFE Dissemination Initiatives Implementation Global Regional Country-specific Public sector-driven Private sector-driven UNDP-driven

18 17 DISSEMINATION Global Country- specific G-8 Economic Summit UNCTAD XI UN Global Compact Leaders Summit Commonwealth Business Council World Resources Institute World Economic Forum 2005 NEPAD/WEF Africa World Economic Summit African Union Summit APEC Economic Leaders' Meeting and CEO Summit Country launches, e.g. Albania, Brazil, Bulgaria, China, India, Macedonia, Mozambique, Turkey Rwanda Investment Conference Regional Illustrative list of events June November December January June July November All 2004 May

19 18 INITIATIVES Public sector- driven UNDP- driven Informality and Regulatory Reforms Business School Network Technology for Microfinance Business Linkages Bottom of the Pyramid Business Development Annual Private Sector Report SME Brokerage Microfinance Private sector- driven Illustrative list of initiatives under consideration

20 19 IN SUMMARY, THE REPORT: Formally puts the UN on record on the important role of the private sector Examines the issues from the viewpoint of the domestic private sector first and then looks outward Includes the informal sector – and the poor as such – as a key element of the private sector Emphasizes the critical nature of the linkages amongst all of the components of the eco-system, from microenterprises to MNCs Focuses centrally on the rule of law and the need for a level playing field Highlights many developmental activities of private players that are below the radar screen but offer great promise for sustainable market-based replication Ends with a comprehensive program of action that cuts across all of the quadrants of developmental interventions for private sector development

21 20 IN CLOSING The main message from the Secretary General when he accepted the Report on March 1, 2004, was a Call to Action for the main stakeholders in the development coalition to join the UN in helping to bring to life the Commission's Recommendations Thank you for your time and attention


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