In addition, financial co-operation can provide public-sector stakeholders with assistance in the form of subsidies or loans. For example, loans may be provided to countries or sectors that, because of the higher investment risk, are either not served by the conventional commercial banks or are obliged to pay very high interest rates. Another form of co-operation is the multi-stakeholder partnership (MSP). An MSP is a long-term partnership between state, civil-society and private-sector stakeholders that usually aims to address complex overarching challenges for particular sectors or individual products. A prominent example of an MSP is the German Initiative on Sustainable Cocoa, the members of which are seeking to make cocoa farming more sustainable by sharing their knowledge and experience. The Initiative’s goal is to improve the livelihoods of cocoa farmers and conserve natural resources.

What are the development benefits?

The DEval evaluation concludes that co-operation with private businesses is in principle a relevant and appropriate means of contributing to poverty reduction and food security, which are the main goals of German development co-operation in the agricultural sector.