Adjusting PSD Interventions in the Short Term

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

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.

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:

Launching dedicated funding windows, funds and initiatives focused on innovative responses to COVID-19 (by businesses and other partners), e.g.

Sharing knowledge on business-driven initiatives to respond to COVID-19 and providing tailored support 

Adjusting Small and Medium Enterprise Development programmes

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

Adjusting Market Systems Development programmes

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.

Adjusting Business Environment Reform programmes

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.

Cross-cutting issues for funders and implementers: Adjusting grant agreements, project management and results measurement

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

Generic resources on the management of remote teams

Photo credits: Kathleen Steeden/; USAID/