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Coordination with private sector key to reaching SDGs

“Focusing on challenges globally and that Bangladesh faces”

Overview:

The development finance agenda is broad. Contents it covers may be different according to the

development priorities worldwide, but some basics are common as- how should progress be paid

for? What is the role of the public and/or private sector? Who should monitor sources of finance?

Isn’t it now finally time for structural reform in global financial institutions, such as the World

Bank. And what proportion of development should be paid for out of domestic as opposed to

international resources?

What is important to keep in mind for action is that the world does not need another list of

financial problems and solutions, another meta-analysis of the situation. It needs priorities.

First, identify the most important issues. One of the main problems of the MDGs, adopted for

2000-2015 as noted in countless analyses, was their failure to bring the major structural issues to

the table. Today it is even clearer than 15 years ago that such major structural issues need to be

managed if the world is to adopt a sustainable path. Such issues could be explicitly prioritized in

the UN finance for development declaration.

Second is achievability. Reflecting on the way cotton subsidies abroad had all but destroyed

Mali's cotton industry, its one big chance to emerge from aid dependency; they weren't

campaigning harder on the issue assuming that it was pointless – incentives in subsidizing

countries were too strong to overcome; better to work on things with a chance of progress!

The same analysis needs to be applied to the prioritization of goals and commitments in

development finance. Some issues remain fairly intractable (like subsidies in richer countries)

but the international context for progress on other systemic issues is better than ever, as people in

rich countries clamor for fairer burden-sharing in times of austerity. The achievability test is also

a key to the public versus private debate. The role of the private sector, both domestic and

multinational, is critical to development outcomes. Rather than focusing on getting commitments

from the private sector, which follows a particular set of incentives, it may be more sensible to

set out how public actions can encourage – and sometimes force – companies and banks to be as

pro-development as possible.

Prioritizing some issues doesn't mean forgetting others – it means allocating time and resources

most appropriately after an assessment of importance and achievability, just as has happened for

the SDGs. Reaching the SDGs will require a step-change in both public and private investment.

Public sector funding capabilities alone may be insufficient to meet demands across all SDG-

related sectors. However, today, the participation of the private sector in investment in these

sectors is relatively low. Only a fraction of the worldwide invested assets of banks, pension

funds, insurers, foundations and endowments, as well as transnational corporations, is in SDG

sectors, and even less in developing countries.

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Investment through Private Sector:

Coordinated efforts with the private sector and an action plan with accountability hold the key to

achieving the United Nations' 17-point sustainable development goals. According to Ahsan H

Mansur, executive director of the Policy Research Institute, the SDGs are focused on the private

sector, while the millennium development goals were primarily focused on the social sector. So,

the government has to focus on the private sector, which, in turn, must actively participate to

help achieve the goals.

Seven of the 17 SDGs are directly linked with trade, business and investment. So, without real

and effective collaboration between the government and the private sector, the SDGs cannot be

achieved. For example, ensuring access to affordable, reliable, sustainable and modern energy

for all will be challenging for Bangladesh as the country is running out of gas. Another major

challenge will be building resilient infrastructure, promoting inclusive and sustainable

industrialization and fostering innovation.

Without infrastructure no country can have a better economy. So, Bangladesh has to have better

and sustainable infrastructure to attain the goal. Infrastructure will lead us to growth and the

growth needs to be sustainable and inclusive. The SDGs forecast 7 percent gross domestic

product growth for least-developed countries, which, the economist said, is an opportunity for

Bangladesh as the country is very close to attaining the target.

Combating climate change, sustainable consumption and production, development and uses of

ports, and preventing air and water pollution are the other challenges for Bangladesh. If we work

collectively, in a link created between the rural and urban communities to achieve the goals, the

SDGs can be achieved.

Investment Opportunities in Bangladesh:

The government is fully committed to facilitating the private sector as govt. wants to believe that

Bangladeshi entrepreneurs are resilient and are moving the country forward. Private investment

is welcome in all areas of the economy with the exception of the four reserved sectors:

Arms and ammunition and other defense equipment and machinery

Forest Plantation and mechanized extraction within the bounds of reserved forests

Production of Nuclear Energy

Security Printing and Mining

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Investment of $5-7 trillion will be needed per year to achieve the SDGs globally. So the funding

will be a key challenge for Bangladesh as well, the country will need to increase its revenue

collection, attract more foreign assistance and investment and utilize them properly.

Investment in infrastructure development under public-private partnership initiative can be a

key-point. Bangladesh govt. as doing recently should have soften rules to promote the PPP.

Palash Kanti Das, assistant country director of the United Nations Development Programme, said

the seventh five-year plan 2016-2020 for Bangladesh coincides with the SDGs in many ways.

But prioritization and sequencing should be the first task, followed by drafting of a plan of action

with accountability, to achieving the SDGs.

Infrastructure & Transportation Improvement:

Dhaka Chamber of Commerce and Industries (DCCI) President Hossain Khaled recommended

infrastructure development, power and energy security, skills development, technology

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adaptation, policy-framework and long-term strategy for attaining the SDGs. He urged the

government to ensure easy financing for small and medium enterprises, as it is the main driving

force of the economy.

Bangladesh's government wants to invest $8 billion over the next few years in infrastructure to

improve the economy and sought help from private sector to share the cost which the

government could not bear alone. Here is scope to invest for accommodation, public transport-

bus, train, launch, high-way, railroad, bridge and what not!

Khaled said the government should form a national implementation forum, a single and small

platform consisting of public and private sector representatives along with all stakeholders, for

monitoring the implementation process of the SDG initiatives.

Ready Made Garments (RMG):

RMG is another and a big scope for more investment. Country has already 6 EPZ and govt. is

trying to work more in this sector.

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Energy Sector:

Energy sector has prioritized by current govt., as we are forwarding to 50 years of Independent in

2021, in Vision 2021. Govt declared to have 20000MW installed capacity by 2021. At present

we have 10600MW installed capacity with generating 7500 MW. A big deal for investment lies

for private sector to share the next need of country and own profit.

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Remittances:

We have remittances every year and its increasing day by day. If this can be used in long run

projects with security and good profit we can have huge investment which is greater than ODA

received by Bangladesh!

Conclusion:

Bangladesh continues to make progress on human development and reducing extreme poverty.

The main problems are political uncertainty and weak competitiveness, which are dragging

acceleration of private investment and growth. The economy is gradually recovering from

prolonged disruptions, aided by political and macroeconomic stability. The challenge now is to

consolidate this by accelerating economic growth in an inclusive and sustainable manner. To

sustain growth in the near- and medium-term, private investment need to increase significantly

along with improving the quality of public investment.

To say, we need doing good and do good things well at the same time to achieve the SDGs.

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Sources:

1. Ministry of Finance Bangladesh (http://www.mof.gov.bd/en/)

2. http://www.bkmea.com/business-opportunity-in-bangladesh.html

3. http://www.worldbank.org/en/news/feature/2014/10/21/the-bangladesh-development-update-economy-

progressing-below-potential

4. http://bdnews24.com/economy/2015/09/19/bangladesh-wants-to-invest-8-bln-in-infrastructure

5. www.tradingeconomics.com/bangladesh

6. http://www.pewsocialtrends.org/2014/02/20/remittance-map/

Abdullah Al Mamun

Electrical Engineer(Transformer)

Energypac Engineering Ltd

Savar, Dhaka, Bangladesh.

December 08, 2015.