Sustainable and broad-based economic growth is one of the most important prerequisites for reducing poverty. Broad-based economic growth creates job opportunities that help poor population groups safeguard their livelihoods by their own efforts. The increasing globalisation of economic processes and the liberalisation of trade create great challenges for partner countries of development cooperation as well as opportunities for their own development. Some countries and businesses manage to adapt to the new conditions and global competition. Other countries, businesses and people, however, risk being sidelined when it comes to the global positive growth process and, ultimately, being left behind. In order to allow everyone to participate fairly in the global growth process on a sustainable basis, German development policy promotes economic development based on social and ecological market economy principles. more

The social, economic and ecological problems developing countries face pose political challenges that cannot be met by the state alone. When governments cooperate with the private sector, additional money and also additional know-how can be made available to development cooperation. That increases the efficiency of development cooperation, because the commitment and innovative power of private businesses can penetrate into areas the state cannot reach for political, economic or logistical reasons. That is why the German government cooperates intensively with the private sector at various development policy levels. more

Fair trade can get producers in developing countries out of what is often extreme poverty and promotes basic organisational structures at local level as well as sustainable management. When consumers buy fairly traded products they guarantee the producers a fair income which they can use to support themselves and their families. Fair trade secures prices above the world market level by means of long-term contracts, fixed purchase quantities and dispensing with the middlemen. There is also a fair trade premium, a guaranteed additional source of income which producers of fairly traded products can invest in safeguarding their communities' economic and social livelihood, thus improving their living conditions. Fair trade represents a small proportion of global trade, but it nevertheless has the potential to support fair globalisation and to reduce unfair global economic structures in the long term. That is why the German government promotes fair trade. more

The global market economy needs international institutions to create the enabling environment for fair global trade. The most important such forum is the World Trade Organization (WTO). Since 1995 it has been setting out rules governing the trade in goods, services and intellectual property which affect practically every person in the world. The aim of German development policy is to help establish a stable and socially responsible world economic order. Germany is committed at international level to reducing competition-distorting subsidies in industrialised countries and to opening up markets in industrialised countries for products from developing countries. In order to prevent competition turning into exploitation, it is also committed to decent terms and conditions of employment. more

The global competition for markets and investors is tough. To gain a short-term competitive edge some developing countries flout workers' fundamental rights, known as social standards. Germany is committed to implementing these standards worldwide, because that will make a key contribution to improving living conditions in partner countries - and thus also help reduce poverty. Besides that, social standards - as many businesses have discovered - can also bring competitive advantages. more

Environmental protection measures and environmentally friendly production processes cost money and diminish a company's earnings. For many businesses, voluntarily paying for such measures and the resulting general benefits appears 'uneconomical' at first glance. The case can be a different one when market economy measures are applied to ensure more environmental protection. What is needed is an enabling environment within the context of which the producers are also asked to pay for those environmental costs that have in the past been borne by the general public. Environmental standards and ecostandards are an important element of such an enabling environment. The aim in introducing standards is to allow economic development while at the same time ensuring that natural resources will be available permanently. Germany supports partner countries in introducing such standards. more

In spite of rapid technological developments, there are many people around the world who are being denied access to information and communication technologies (ICT) and the opportunities they open up. According to the 2008 Human Development Index (HDI), in 2005 only 48 out of every 1,000 people living in the least developed countries (LDCs) owned a mobile phone and only 12 out of every 1,000 had internet access. ICT are gaining in importance in development cooperation. They are not only indispensable project planning and coordination tools, they also have a key role to play when it comes to achieving specific development goals. more