Mobilizing private sector essential to bridging trillion-dollar SDG financing gap – Egypt’s Finance Minister

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  • SDG financing gap is currently estimated at US$2.5 trillion and widening
  • Business-friendly reforms to drive private sector activity in all fields
  • Private sector has a critical role to play in global transformation
  • Multilateral development mindset needs to change from a lender to a mobilizer, Egypt-ICF told

Cairo, Egypt: Mobilizing the private sector is critical to bridging the $2.5 trillion Sustainable Development Goals (SDG) financing gap, Egypt’s Minister of Finance, H.E. Dr Mohamed Maait, said today at the inaugural Egypt International Cooperation Forum (Egypt-ICF), running September 8 to 9 in Cairo.

Speaking during a panel session entitled, ‘Private Sector Engagement in Development Through International Cooperation’, Dr. Maait said: “The mobilization of private finance for sustainable development has become an important function of the multilateral development system.”

With the current trillion-dollar SDG financing gap widening, the panel made the case to align more global finance in support of the 2030 Agenda for Sustainable Development.

Addressing the panel, Jay Collins, Vice Chairman of Corporate and Investment Banking at Citi, said: “The need of the hour is to move the needle for development purposes, which may take longer due to the global COVID situation. Official Development Assistance (ODA) financing has become strained with the pandemic and its aftermath, resulting in fiscal retrenchment in developed countries.”

Highlighting the need for more private sector participation, H.E. Amadou Hott, Minister of Economy, Planning and Cooperation of Senegal, said: “Business-friendly reforms are paramount to drive private sector activity in all fields. Business reforms are important, and governments need to announce tax reforms to widen the tax base and lower the tax rates.”

Emphasizing the point, Estherine Lisinge-Fotabong, Head of the African Union Development Agency (AUDA-NEPAD) delegation, stressed: “A mindset change that is policy-oriented is important in the way business is conducted.”

“Private sector engagement in development is vital. It is all about people and not about money. The private sector has a critical role to play in this transformation, as it contributes to the creation of employment and overall growth.”

Delivering her comments to the panel on the platform of the Cairo stage, Stephanie von Friedeburg, Senior Vice President – Operations at the International Finance Corporation (IFC), said: “To tackle the world’s biggest development issues, we need more bankable projects, technology-driven solutions, and blended finance tools. Those will get us a long way.”

“Despite the significant accomplishments of Arab development in the past decades, achieving the principles of comprehensive development still requires more effort. We need to progress towards laying  a solid foundation for cooperation and to build partnerships between international and regional financial institutions, beneficiary countries, the public and the private sectors,” elaborated Bader M. Alsaad, Director General of the Arab Fund for Economic and Social Development.

“I agree that the mindset needs to change from a lender to a mobilizer – like a risk taker. While some progress has been made, there is still a long way to go, which will allow the institutional community to come in,” shared Haje Schütte, Senior Counsellor and Head of Financing for the Sustainable Development Division of the OECD Development Co-operation Directorate.

Tidjane Thiam, Executive Chairman of Freedom Acquisition Corp. 1, said: “The availability of capital is not the issue. The crux of the matter is to find a way to drive the capital to the ground level. This development will happen only through a vibrant SME ecosystem. We need equity investments.”

Alain Pilloux, Vice President – Banking at the European Bank for Reconstruction and Development (EBRD), expressed: “More private sector involvement is key to growth. It all boils down to a stable political environment. While the governments need to take on their share of responsibilities, the private sector and the multilateral development agencies need to complement this.”

About the Egypt – International Cooperation Forum:

The Egypt — International Cooperation Forum (Egypt — ICF) is a two-day global event that convenes the international community to drive a sustainable recovery through multilateralism.

Organized by Egypt’s Ministry of International Cooperation, the Forum is being held in Cairo, Egypt, between 8-9 September 2021 in a hybrid format – allowing both physical and virtual attendance.

The Egypt — ICF provides a unique global platform in the Middle East and North Africa (MENA) region, to bring together international policymakers, multilateral and bilateral development partners, private sector stakeholders, civil society and think tanks to collaboratively reboot international cooperation through economic diplomacy in the post-pandemic era.

The Forum aims to foster a collective international commitment to accelerate the transition to a green and inclusive global recovery, catalyze social mobility in Africa and tackle climate change.

The Egypt — ICF is co-organized with leading international development institutions, including: the United Nations, the World Bank Group, Organisation for Economic Co-operation and Development (OECD), the African Development Bank (AfDB), and the European Bank for Reconstruction and Development (EBRD).