Role of private sector in attaining SDGs

A strong public-private partnership is imperative to achieve the Sustainable Development Goals (SDGs). A separate policy of partnership with the government could be the entry point to collaborate and move further.

SDG priorities have been aligned with medium term development outline and 7th Five Year Plan (FYP). Some priority actions have also been identified to achieve these targets.

Achieving each of the SDG goals requires collective roles of the government, private sector, civil societies, NGOs and many others.

All the SDG goals that cover areas like poverty, hunger, health, education, climate change, gender equality, water, sanitation, energy, environment and social justice, are interrelated and interconnected. According to the statistics, both income inequalities and wealth inequalities have been increasing. How SDGs can be utilised to reduce these inequalities is an important issue to be addressed.

The country has around 2 crore school-going students and by 2030, majority of them would be in graduation level. Providing them with a job willbe a big challenge.  Here the entry point could be to raise the capacities of the private sector as a thriving private sector can play a core role to create more and more jobs.

 SDG mapping in Bangladesh has rightly put emphasis on more investment and FDI, technology and innovation.

SDGs is a global issue but significant proportion of the funding for implementation of SDGs will be coming from the domestic sources. It is told that one of the primary achievements of the SDGs is that it needs collective actions. It is not possible for the public sector alone to arrange financing for achieving all the goals. On the other hand, private sector also needs support from the government,. A natural partnership has to be development for which a separate goal has been set. Full realizstion of SDGs required strategic partnership.

Challenges are manyfold. Total Investment outlay of 7th FYP is BDT 31.9 trillion or USD 407 billion, of which share of private sector is 77.3 per cent (USD 314billion),  and share of public sector is 22.7 per cent (USD 92 billion). Gross Domestic Investment as per cent of GDP would need to increase from 28.97 per cent to 34.4 per cent during the plan period. FDI is supposed to increase from USD 2.25 billion to USD 9.56 billion.

Private sector is willing to invest but the overall investment system is not fully supportive to the private sector. There is a regulatory unpredictability and policy inconsistency in the country.  Foreign investors are feeling insecure about the enforcement of contracts, afraid of the risk of their branding reputation. These transmit negative messages to the other investors.

SDG financing strategy, prepared by GED, assessed that Bangladesh would require $928bn additional funding from 2017-2030 to fully implement the SDGs, and annual average costs would be $66.2 billion. Of the total resources around 56.86 per cent will be collected from domestic sources, 9.46 per cent will come from external sources, 6.91 per cent from FDI.

There are some other sources such as capital market, bond market, debt issues etc. 42.09 per cent will come from the private sector plus 9.95 per cent from FDI totaling about 52 per cent from the private sector, NGO's will contribute about 4 per cent, public sector will contribute 33.50 per cent, remaining about 5 per cent will come from foreign aid and grants. It seems that private sector capacity has to be strengthened a lot to contribute for the SDGs.

Bangladesh requires huge financing from multiple sources. The government continues efforts to further improve the investment climate and adjust policy and regulatory framework to attract more financing in the form of domestic and foreign investment.

 There is a need for systematic dialogue with public and private sector as the regulatory frame need to be adjusted as per the requirement of new generation business entrepreneurs. In some cases policies are there but enforcements are not clear which increases cost of doing business and undermines capacities of the private sector.

Private sector play an important and crucial role in determining outcomes of specific SDGs such as Goals 8,9,12. Role of private sector may go beyond these goals such as SDG 5 which covers gender equality

Becoming efficient, and propermanagement of natural resources is critical in achieving the SDGs. Companies can replace natural resources with waste and demolition waste (recycling), recycled  minerals and increase the use of solar and wind energy, reduce food waste and food losses.

Agricultural commodity traders can help to reduce post-harvest losses by investing in and ensuring better access to processing, storage and transportation facilities. Achieving environmentally sound management of chemicals and wastes, minimise release of harmful substances with wastewater and pollution of local water and farmland by limiting the use of hazardous chemicals during the production process, are all necessary to achieve SDGs. But to attain all  these goals, private sector  needs technology, funding and mentoring. 

Popularisation and m maximum use of Green Transformation Fund(GTF),is also a major challenge. Banks and financial institution need to develop their capacities to support private sector. Private sector would need to come up with specific proposals for implementation.

Technologies are beyond control of private sector for introducing innovative models. Banks are following traditional models not equipped with new methods. LDCs would need to join their hands to bargain with multi-national communities to get benefits of article 66.2 of TRIPS so that technologies are made available to the poor countries.

Over and above, a coordinated and harmonised CSR policy could be a vehicle to allow private sector to take care of  social issues incorporated in the SDGs.

The writer is CEO, Business Initiative Leading Development (BUILD), a partnership organization of DCCI, MCCI and CCI.

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