Business Development Services for Small Enterprises: Guiding Principles for Donor Intervention
(08/01, En, Es) See also Microenterprise
Donor agencies have long recognized the important contribution that small enterprises (SEs) can make to poverty reduction, employment and private sector development. SEs, especially microenterprises, offer both a safety valve for the survival of surplus workers unable to find steady wage employment and an opportunity for the entrepreneurial poor to raise their incomes. SEs, especially SMEs, also offer a vehicle for acquiring and applying skills to raise productivity and private sector growth, providing better wage-earning opportunities for the poor while raising national income. For these reasons, donors as well as national governments have attempted to promote the SE sector through support for financial and non-financial services appropriate for SEs.
After several years of efforts to build a consensus on principles for selecting and supporting intermediaries in micro and small enterprise finance, the Committee of Donor Agencies for Small Enterprise Development (see Annex III for membership) turned its attention to Business Development Services (BDS)?the wide array of non-financial services critical to the entry, survival, productivity, competitiveness, and growth of SEs. The Guiding Principles presented here grew out of efforts of the donor community to assess the generally unsatisfactory performance of past interventions in BDS, review current innovations and good practices, and develop a more effective strategy for BDS as one instrument of private sector development.
While now enjoying widespread support among many of those representing member agencies of the Committee, these Guiding Principles (as with other Committee publications) have not been officially endorsed by each member agency. Rather, the Committee is issuing this document in hopes of further stimulating dialogue among donors, practitioners and governments on the objectives and effective methodologies for supporting services aimed at developing small enterprises. This dialogue is expected to lead toward more effective interventions to support a dynamic, indigenous private sector in developing countries.
William F. Steel and Leila M. Webster (World Bank Group)
Co-Chairs Committee of Donor Agencies for Small Enterprise Development
Last updated: 05/08/07
