Development Policy Committee: Greater policy coherence in private sector support for developing countries

Press release 4/2017
24 May 2017

Developing countries’ own economies and their private sector and tax base are at the heart of the current Government’s development policy. The Development Policy Committee appreciates the new emphasis. At the same time, however, it is important to make sure that the poorest people, especially women and girls, will be able to enjoy the benefits of economic growth more than today.

In its annual report 2017, the Development Policy Committee states that the key question is how can developing countries’ strengthened economy and private sector meet the rights and needs of people also in the poorest countries.

When business activities are strengthened in the developing countries, it is important to pay attention to the quality of jobs and to observe the ILO’s criteria of decent work. That is why all companies whose activities in the developing countries are supported through development cooperation appropriations must be required to comply with the national and international regulations. In addition, they must be able to prove that their business activities contribute to the eradication of poverty.

The Development Policy Committee considers that it is important to do both ex ante and ex post evaluations in order to ensure the highest possible degree of coherence. When decisions are made on public support for companies, it is important to consider the developmental impacts of the activities, to make human rights and environmental impact assessments, and to require reporting of the results.

The Government’s new priorities must be complemented by a clear plan of action and different actors must be given guidelines applicable over subsequent government terms. More detailed guidelines are needed especially as regards the human rights based approach,  policy coherence, transparency and effectiveness. During the current government  term, Finnish companies’ role in the development of developing countries’ private sector is laid more emphasis than before among the tools of development cooperation. The Development Policy Committee considers this important but as such a narrow perspective.  Finland must act more consistently in the promotion of its partner countries’ economies and private sectors and pay attention to the foundations of entrepreneurship and the industrial policy that supports entrepreneurs.

The Development Policy Committee emphasises that taxation is an essential factor of every economy and an integral part of safeguarding the functions of society and people’s wellbeing. Finland's Tax and Development Programme clearly states that efforts to improve developing countries’ tax capacity require policy coherence that supports development and cooperation between various actors. However, the objectives of Finland’s international tax policy need to be clarified.

The Development Policy Committee is concerned about savings affecting Finland’s development cooperation appropriations, shortage of human resources, and challenges in the monitoring of results that complicate the practical implementation of the new development policy priorities.

More information: Member of Parliament Aila Paloniemi, Chair of the Development Policy Committee, tel. +358 50 511 30 67, and Marikki Stocchetti, Secretary-General of the Development Policy Committee, tel. +358 50 525 8649,

The Development Policy Committee is an advisory body appointed by the Government. It follows and evaluates Finland’s activities in various policy areas that influence developing countries. The Committee, which represents all parliamentary parties and society at large, also assesses the quality and effectiveness of development cooperation and follows the level of official development cooperation appropriations.