“Conflict, violence and peace both shape and are shaped by the economy. (…)The need and desire for access to and control over resources has always been a cause of conflict”; conversely, societies are more likely to prosper and be peaceful if people have fair access to livelihood opportunities and services. (International Alert, 2015).
This page brings together key resources on the challenges and opportunities of private sector development (PSD) approaches in fragile and conflict-affected environments (FCAEs). Key take-aways include:
- Even in adverse situations, the private sector still provides the most important route out of poverty.
- Well-designed PSD programmes can be a viable way of reducing poverty in FCAEs, but the extent to which PSD helps peace-building is less clear.
- Successful PSD programmes in FCAEs require sufficient resources and the right staff capacities to fully understand the situation on the ground.
DCED publication 
External publication
A Synthesis Note that summarises current findings, issues and debates on PSD in FCAEs.
This brief summarises effective PSD support strategies based on an evaluation of World Bank Group Assistance to Low-Income Fragile and Conflict-Affected States.
- Business Environment Reform in Fragile and Conflict-Affected Situations, DCED 2020
- Practical Guidelines for Measuring Results in Fragile and Conflict Affected Environments (Version 3), DCED, last updated 2015
- Private Sector Development in CAEs – Key Resources for Practitioners, DCED, 2010
- PSD in Post-Conflict Countries: A Review of Literature and Practice, DCED, 2008
Global analyses of fragility
- States of fragility, OECD, October 2020
Economic conflict drivers
- How Does Work Feature in Literature on Youth Participation in Violence? Institute for Development Studies, 2017
- World Development Report on Conflict, Security and Development, The World Bank, 2011.
- Greed and Grievance in Civil Wars, P. Collier and A. Hoeffler, 2004.
The impact of conflict on business
- SME Competitiveness Outlook 2023: Small Businesses in Fragility: From survival to growth, ITC, 2023
- Private Sector Development in Conflict Affected States, DFID, 2018
- Understanding how political violence impacts spending patterns, IGC, 2018
- Private enterprises in fragile situations: Myanmar, IGC, 2018
- The small entrepreneur in fragile and conflict-affected states,The World Bank, 2014
- What does fragility mean for economic performance?, EPS PEAKS, 2012
The role of PSD in FCAEs
- Can more jobs bring peace? Understanding peace impact in employment programme design in Kenya and Somalia, International Alert, 2020
- Escaping the Fragility Trap, The IGC, 2018
- The effectiveness of PSD interventions in FCAEs. Evidence from evaluations, IFC, 2016
- Generating employment in fragile states: Evidence from labor market and entrepreneurship programmes, Blattman and Ralston, 2015
- Pathways from jobs to social cohesion, The World Bank, 2014
Cross-cutting guidance and lessons learnt
- Practical Guidance – Inclusive Economic Development in Fragile Contexts, SDC 2022
- Primer on Private Sector Engagement in Fragile and Conflict-Affected Situations, USAID, 2021
- Inclusive Economic Development in fragile contexts, SDC, 2020
- Private Sector Development and economic growth: Lessons from the US experience in Afghanistan, Special Inspector General for Afghanistan Reconstruction, 2018
- Seminar on PSD in FCAEs, Summary Report, Danida, 2016
- Employment Promotion in Contexts of Conflict, Fragility and Violence, GIZ/BMZ, 2015
- Job creation in fragile and conflict-affected situations, The World Bank, 2014
- Operational Experience of Business Environment Reform Programming in Fragile and Conflict-Affected States, DFID, 2017
- Special Economic Zones in Fragile Situations – a useful policy tool? African Development Bank, 2015.
- The Political Economy of Business Environment Reform: An Introduction for Practitioners, DCED, 2011
- Business Environment Reforms in Conflict-Affected Contexts, International Alert, 2010
- A Rough Guide to Investment Climate Reform in Conflict-Affected Countries, IFC, 2009
- Urgency vs Legitimacy. Tensions in Rebuilding the Legal Structure for Businesses in Post-Conflict Countries, Channell, 2008
- Doing more business and less aid: The journey of a market system development project in Afghanistan, ILO, 2019
- Northeast Nigeria joint livelihood and market recovery assessment, USAID/Mercy Corps, 2017
- Notes from the Frontier: FSD Africa’s Fragile States Approach – A Learning Journey, FSD Africa, 2017
- Market systems for resilience, USAID, 2015
- The BOSS Project in Timor-Leste: Thin Markets, Thick Impact?, ILO, 2015
- Illuminating Market Systems Development in Fragile Environments. A case study of the alternative energy market in Timor Leste, Mercy Corps, 2015
- Challenge funds in fragile states: experience from the Afghanistan Business Innovation Fund, Landell Mills, 2016
- Risky Business: Promoting Private Sector Development in Post-Conflict States. Lessons from the Africa Enterprise Challenge Fund, KPMG, 2013
- Applying a conflict lens to challenge funds, in: Private Sector Development in CAEs – Key Resources for Practitioners, DCED, 2011
- Youth employment in fragile countries, ECDPM Great Insights Vol 6, 2017
- Generating employment in poor and fragile states: Evidence from labor market and entrepreneurship programmes, Blattman and Ralston, 2015
- Practical Guidelines for Measuring Results in Fragile and Conflict Affected Environments (Version 3), DCED, last updated 2015: A “must-have for anyone looking for tools to implement PSD programmes in conflict-affected areas”, Enterprise Development and Microfinance Journal, June 2013.
- Resources from the DCED Workshop on Measuring Results in CAEs, 2014, The Netherlands
- Results Measurement Case Study of the Sustainable Employment and Economic Development Programme in Somalia, DCED, 2013
- Results Measurement Case Study of the Employment Promotion Programme in Sierra Leone, DCED, 2013
- Integrated development and peace-building programming. Design, monitoring and evaluation, DFID, 2013
Photo credits: Ed Hedley.