This page reviews short-term adjustments of PSD programmes in response to COVID-19 (see also this summary note). Medium- to longer-term economic recovery strategies are explored here.
- Adjusting Private Sector Engagement programmes
- Adjusting Small and Medium Enterprise Development programmes
- Adjusting Market Systems Development programmes
- Adjusting Business Environment Reform programmes
- Cross-cutting issues for funders and implementers: Adjusting grant agreements, project management and results measurement
For most donor agencies, Private Sector Engagement (PSE) focuses on promoting the SDGs abroad by working with their own domestic, or larger local businesses in developing countries – whose operations are now heavily affected by COVID-19. Adjusting PSE programmes has therefore become an immediate priority for many agencies, as explored in this section.
Some agencies have produced summaries on how they are adjusting PSE in response to COVID-19:
The resources below summarise short-term adjustments to existing PSE programmes. For links to new PSE programmes developed to integrate COVID-19 recovery objectives, click here.
- PSD and COVID-19: Development Cooperation Response of Belgium, Belgian Development Cooperation, July 2020
- EU Thematic Brief on COVID-19: Private Sector Engagement in COVID-19 times, European Commission, May 2020 (published in June 2020)
- DFID manufacturing support in response to COVID-19. Summary note, DFID, May 2020
Across agencies, specific changes in PSE programming being implemented or explored include:
Ensuring the continuity of partner businesses, e.g. through more flexible financial support conditions:
Scaling up existing partnerships in the health sector:
Facilitating dialogue on companies’ roles in global supply chains:
- A G20 safe & resilient supply chain action plan, ODI, April 2020
Engaging with impact investors and DFIs in the crisis response:
- Blended Finance in the Least Developed Country, Supporting a Resilient COVID-19 Recovery, UNCDF, December 2020
- The role of DFIs in supporting jobs during COVID-19 and beyond, ODI, October 2020
- Mobilising Investment to Sustain Economic Recovery: What can impact investors do? OECD, October 2020
- The Impact Investing Market in the COVID-19 Context: An overview, GIIN, June 2020
- COVID-19 and Blended Finance: Five Ways to Adaptively Respond, Linclocal, April 2020
Launching dedicated funding windows, funds and initiatives focused on innovative responses to COVID-19 (by businesses and other partners), e.g.
- COVID-19 Innovation Hub (multiple donors)
- Leverist: Matchmaking platform (BMZ)
Sharing knowledge on business-driven initiatives to respond to COVID-19 and providing tailored support
- Business and COVID-19 response centre, Business Fights Poverty
Local businesses, particularly small and medium enterprises (SMEs), suffer due to the simultaneous shock in demand and supply. Demand decreases, for example, when restrictions on movements reduce household spending or when markets close. Supply decreases when workers stay home or suppliers cannot deliver.
SME support programmes can engage in the immediate COVID-19 response in two major ways:
Mitigate negative economic impacts and helping firms adapt to new market circumstances, e.g. by:
- financing companies directly to minimise job losses and wage reductions
- financing workers during the crisis, through special projects.
- signposting companies to help & advice
Involving local SMEs in the health response, for example by providing technical or financial assistance to
- the re-purposing of facilities to produce essential items such as soaps, masks and other medical equipment
- support businesses in adopting health-related workplace measures
Relevant resources include:
- Answering key questions around informality in micro and small enterprises during the Covid-19 crisis, ILO, September 2020
- Adjusting business models to sustain agri-food enterprises during COVID-19, FAO, May 2020
- Interventions to support enterprises during the COVID-19 pandemic and recovery, ILO, April 2020
Market Systems Development (MSD) programmes may play several roles in the response to COVID-19. They
- emphasise that short-term responses build on the local private sector as much as possible in order not undermine long-term economic development: For example, direct delivery of health or food products that are (or could be) produced locally could make it harder for local businesses to reopen in the future.
- may help to expand affordable private health services where government capacity is insufficient.
- emphasise the importance of adaptive management. This is particularly critical in dealing with fast evolving crises like COVID-19.
- may be adjusted in the short term to facilitate immediate responses, such as re-purposing partner companies’ facilities to produce health-related goods, while seeking opportunities for developing market systems as a whole.
Relevant resources include:
- BEAM Exchange page on MSD and COVID-19 resources
- COVID-19 – The Situation in East Africa & Our Response to Date, Gatsby Foundation, November 2020
- Reaching Farmers Online: The Future of Agricultural Marketing, PRISMA Indonesia, October 2020: Webinar Presentation and Recording.
- Emerging best practice in adapting SDC projects, September 2020
- Lessons From Evaluations: Responding to Food Security During COVID-19, Global COVID-19 Evaluation Coalition, July 2020
- Guidance on Supporting Safe and Functioning Food Markets, USAID, May 2020
- Markets in Crisis statement about the COVID-19 economic and humanitarian crisis, April 2020
Emerging priorities for donor programmes promoting a conducive policy and regulatory environment for business in developing countries include:
- a greater focus on conducive investment policies and procedures: These may serve to attract new investment, incentivise or mandate companies to re-purpose their business in favour of medical supplies, and promote continuity of existing businesses;
- tax relief or other measures to ease the financial burden on businesses; and
- digitalising administrative procedures, to limit personal interactions.
The resources below offer aggregate analyses or advice on Business Environment Reform areas in the context of COVID-19. For individual countries’ policy responses, please refer to our page on Socio-Economic Impacts and National Responses.
- Using Business Regulation in Re-opening the Economy following the COVID-19 Pandemic, DCED, April 2021
- Enabling Environment for Sustainable Enterprises and the Post COVID-19 Rapid Response, ILO, June 2020
- Investment Policy Responses to the COVID-19 Pandemic, UNCTAD, May 2020
- Tax Issues: An Overview, Special series on fiscal policies in response to COVID-19, IMF, April 2020
- Tax and Customs Administration Responses, Special series on fiscal policies in response to COVID-19, IMF, April 2020
- Tax law design considerations when implementing responses to the COVID-19 Crisis, Special series on fiscal policies in response to COVID-19, IMF, April 2020
Given that many DCED members’ interventions are focused on supporting sustainable incomes and livelihoods, interventions are needed during the crisis more than ever. It is thus important to continue interventions to the extent possible with the reduced capacity for implementation and results measurement, e.g. due to home working arrangements and restrictions on local travel. Possible solutions include:
Virtual project management and results measurement
The Covid-19 pandemic affects all aspects of project management, including what can be realistically done to measure and manage results. For example, the rapid change in the external environment has rendered pre-COVID baseline surveys in affected sectors less useful. Rather than attributing positive results, projects may need to explore to what extent their support has helped to mitigate negative change. There is also a need for leaner results measurement approaches than in the past: Programmes will need to navigate new tools such as phone and SMS surveys, while being mindful of the reduced resources of economically struggling target groups, and implications for the quality and quantity of data collected.
Looking ahead, the adoption of more flexible and iterative digital tools may however also help to pave the way for leaner and more cost-effective project management in the future. Emerging tools to guide programme staff in this are listed below.
Knowledge portals on results measurement and management
Remote surveys: Tools and advice for field staff
- Remote monitoring in the COVID-19 context: Considerations for practitioners based on recent literature, MSI, 2020.
- Impact Measurement and Management During COVID-19: Tips and Resources to Help Social Impact Organisations Adapt, Next Billion, May 2020
- COVID-19 Economic Impact Surveys, IGC and IPA
- Conducting enterprise surveys during the Covid-19 crisis, ILO, April 2020
- Remote survey toolkit, 60dB, March 2020
Generic resources on the management of remote teams
- Tech against Coronavirus– List of virtual meeting and collaboration platforms
- Tips on managing remote project teams during the COVID-10 outbreak, TechRepublic, March 2020
Photo credits: Kathleen Steeden/flickr.com; USAID/flickr.com