The Ministry of Foreign Affairs of the Netherlands (MoFA) oversees the Netherlands’ development cooperation. MoFA states that development cooperation needs to become more effective and efficient and therefore the Netherlands has undertaken a fundamental review of development policy. It has decided to assist fewer partner countries while focusing on four spearhead areas in which the Netherlands can add special value: security and the legal order, water, food security, and sexual and reproductive health and rights. MoFA states that these are areas in which Dutch businesses, civil society organisations, and knowledge institutions can offer expertise and add special value.
Private sector development (PSD) policy and strategy
MoFA channels most of its PSD support through non-governmental organisations, multilaterals and multi-donor initiatives. The NGOs work mainly on market (value) chain development, access to finance, advocacy, business skills and vocational training. Multilaterals and multi-donor initiatives also play an important role in The Netherlands’ PSD strategy, as do partnerships with the Dutch private sector. Meanwhile, Dutch embassies work directly with partner governments to improve the regulatory environment for business.
Across the various areas of intervention, special emphasis is placed on support to disadvantaged groups and regions. Fragile states have become a focal point of Dutch PSD efforts. Among other things, the MoFA facilitates Dutch companies in making pro-poor investments in conflict affected countries. Where partner governments have a weak record of engagement with the private sector, the MoFA works to strengthen domestic employers’, producers’ and workers’ organisations.
- Overview: Trade and Development in Dutch Development Cooperation
- Netherlands Ministry of Foreign Affairs (2013): A world to gain. New agenda for aid, trade and investment
Partnership mechanisms for the private sector
MoFA recognises that economic growth in developing countries is now at the heart of the agenda for international cooperation and MoFA notes that there is greater use being made of Dutch know-how, including business sector expertise. Cooperation between the government, the private sector and civil society organisations is increasingly at the centre of Dutch development policy. MoFA explains that aim of public-private partnerships (PPPs) is to work together to achieve joint development goals and to improve aid effectiveness in an innovative way by combining and strengthening each other’s knowledge, capacities and resources. Public-private partnerships, business instruments and economic diplomacy can lead to gains in both commercial profit and poverty reduction. Therefore, the Netherlands has established and supports many partnership mechanisms. The Netherlands hopes that these partnerships will build bridges worldwide.
- OECD DAC Peer learning review on private sector engagement (2016): Netherlands
- Overview: Public-Private Partnerships in Dutch Development Cooperation
- Dutch Good Growth Fund (DGGF): Finance, insurance
- Dutch Sustainable Trade Initiative (IDH): Brokering links between companies and NGOs/ governmental organisations; Financial support (grants); Knowledge sharing; Technical Assistance
- African Enterprise Challenge Fund (AECF): Financial support (loans, grants)(multi-donor)
- Matchmaking Facility: Brokering links between companies
Transparency, effectiveness and results in PSD
The Dutch Ministry of Foreign Affairs is committed to increasing the effectiveness and efficiency of its development policy. Evaluation and transparency are important elements of this commitment.