Private sector involvement in development

On 9 February 2016, a meeting of the French National Council for Development and International Solidarity (CNDSI) was held in Paris. The meeting was chaired by Ms Annick Girardin, Minister of State for Development and Francophonie (who now occupies a different post, following the French cabinet reshuffle on 11 February 2016). The CNDSI brings together a range of actors from organisations including the Ministry of Foreign Affairs and International Development (MAEDI), the French Development Agency (AFD), trade unions, NGOs and local authorities.

The first item on the meeting’s agenda dealt with the report on establishing closer links between the AFD and the Deposit and Consignment Office (CDC) to enhance international development and solidarity. The report (entitled Rapprocher l’AFD et la Caisse des dépôts et consignations (CDC) au service du développement et de la solidarité internationale) follows the announcement by the French president on 25 August 2015 that the AFD was to be brought together with the CDC. This approach should enable more financial resources to be freed up for the AFD, leaving it better placed particularly to meet development-related challenges and the fight against climate change.

Among many other points, the report underlines the will to give companies a bigger role in development.

In this connection, the French Democratic Confederation of Labour (CFDT) used the meeting on 9 February 2016 to share its concern and questions regarding how corporate involvement in development is being tackled, for while the report clearly announces a more prominent role for the private sector, it does not touch on the conditions to be imposed regarding:

  • corporate behaviour, especially with respect to social, environmental and fiscal responsibility; or
  • the criteria for selecting and allocating funds to the companies involved.

On the latter point, the CFDT told the participants at the meeting that the ITUC had conducted a study on the effectiveness of official development assistance (ODA) funds supporting the private sector, primarily via institutions like Proparco in France. The study had focused on several countries and would be published shortly. Its findings highlighted a number of problems, including:

  • appropriation (no obligation to consult governments and players in the countries where projects are implemented, contradicting texts like the Paris Declaration);
  • the existence of selection criteria that favour multinationals over local actors;
  • the lack of transparency regarding financed projects, which among other things makes it hard for civil society to access some information and get a handle on potential problems encountered with these projects.

In the light of these observations, the CFDT asked how we could work on these issues and manage corporate behaviour and the allocation of ODA funds to the private sector with a view to ensuring that the initiatives supported genuinely pursue development goals.

The Minister of State responded by taking up only some of the many questions asked by various participants and comments made on this agenda item (the report on closer relations between the AFD and CDC). Specifically, she underscored her intent to cover aspects of corporate social and environmental responsibility and stressed that she understood ongoing concerns about ’economic diplomacy’. She also pointed out that such ’economic diplomacy’ was not a priority here and that the focus here had to be the 2030 Agenda for Sustainable Development, though she also emphasised that development policy had to promote French know-how. She also mentioned the importance of transparency, but did not specifically go over the criteria and conditions for allocating public funds to companies.

Since this issue is now on the table, it is up to us to keep raising it, both in this body and elsewhere, until it ends up being satisfactorily addressed and dealt with. Studies like the one commissioned by ITUC/TUDCN are very useful in this respect, because they enable us to provide additional knowledge and data to support our claims.