Private Sector & Development magazine articles

Prior to 1997, the East Zone of Metro Manila was faced with numerous water problems, for example only 26% of the area’s population had access to a continuous water supply. However, the city was able to overcome this serious problem with the emergence of Manila Water whose efforts led to a significant overall improvement in water supply and sanitation services.

As part of the programme to privatise water and sanitation services in the State of Rio, the private company Águas do Rio - supported by IDB Invest and Proparco - was awarded management of two concessions in 2021, covering areas where almost 10 million people live. Connection to a reliable water network, managed using leading-edge technology, has revolutionised the lives of local residents, mainly in a number of Rio’s favelas. Report.

Attracting private sector participation to the water sector is key to achieving the Sustainable Development Goals (SDGs). Successful experiences abound, as described in this issue. However, as investment levels remain low, clarifying the contracting parties’ expectations upfront and establishing the right enabling environment (including regulatory frameworks) is key to increasing participation.

Facilité d’Investissement et de Soutien aux Entreprises en Afrique (FISEA - Facility for investing in and supporting African business) is one of the first venture capital investment initiatives set up by AFD Group to support fragile countries. It was launched in 2009 and topped up in 2021 as part of the Choose Africa initiative. The initiative currently totals €490 million, part of which is earmarked specifically for investments in fragile countries.

Fragile and Conflict-affected Settings (FCS) may be characterized by illegal armed groups, organized crime and violence, ethnic and sectarian tensions, inapt land tenure regimes, corruption, and interwoven legal, informal, and illicit economies. In such a setting, investment, job creation and economic growth may not by themselves mitigate conflict and fragility or make societies more peaceful and stable. Investors who do not account for these characteristics of FCS may inadvertently sustain the very forms of fragility and conflict that they hope to transform. Conflict-sensitive approaches are, therefore, imperative.

The FEFISOL II fund - which supports rural microfinance institutions and agricultural structures - and the Entrepreneurs du Monde association - which works towards the social and economic integration of highly vulnerable people - are working in distressed parts of Africa. By financing and supporting microfinance institutions, agricultural structures and micro-businesses, and factoring in climate and environmental issues, both the Fund and the association are improving the living conditions of many vulnerable workers, enhancing food security and responding to emergency situations by adapting their actions to rapidly changing crisis environments.

Fragile countries like Nigeria have to contend with a high level of energy insecurity - a result of their many social, economic, security and health challenges. Energy supply solutions are limited for the private sector, and diesel generators are often used to replace a faulty or expensive electricity grid. Photovoltaic solar energy is a valuable alternative, however, its adoption is often delayed by regulatory uncertainty, unpredictable changes in grid prices and exchange rate fluctuations.

The world is currently facing a forced displacement crisis. Forced displacement has shifted in scale, and its increasingly protracted nature calls for development approaches that extend beyond the prevailing care and assistance approach. Yet, within development approaches, we believe in private sector-led solutions in forced displacement contexts.

Financing of essential local services and sustainable infrastructure in African cities is not sufficient to meet current demand. Project preparation funds can provide both preliminary technical assistance and project support for resilient urban development programmes. In doing so, they facilitate both decision-making and financing, especially from private stakeholders.

A partnership between Proparco and pioneering digital network and data company WIOCC is contributing to enabling Africa’s digital transformation. The initiative is creating a world-class technology environment for Africans to use to build better lives and better businesses. This includes local digital content creation, engaging users and promoting inclusive development.