Economic cooperation:
fighting poverty and achieving equality

Trainee doing metalwork. Copyright:

Economic development, growth and employment

No country can develop sustainably unless its economy develops too. Broad-based economic growth is one of the most important prerequisites for poverty reduction. Economic growth creates job op­por­tu­ni­ties that help the poor safeguard their livelihoods through their own efforts. The increasing glob­al­i­sa­tion of economic processes and the liberalisation of trade create major challenges for partner coun­tries of development cooperation, as well as opportunities for their development. Some countries and businesses have so far succeeded in adapting to the new conditions and global competition. Other countries are finding it difficult to do so. They risk being sidelined from the global positive growth process and, ultimately, being left behind. To help enable 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

Supporting the private sector – reducing poverty

Solving the social, economic and ecological problems faced by developing countries is a challenge that cannot be met by the state alone. What is required is intensive cooperation between all sections of society. Companies in the private sector wield major influence over the globalisation process. By cooperating with them, governments can gain access to additional resources, know-how and money for development cooperation. Furthermore, the commitment and innovative power of private businesses often penetrate into areas the state cannot reach for political, economic or logistical reasons. This is why the German government cooperates closely and highly successfully with the private sector at various development policy levels. more

Fair Trade

Consumers play a central role in the world trade system because their decisions on what to buy can directly impact on the working and living conditions of people in developing countries. Fair Trade helps reduce poverty and promotes sustainable economic activity. Buying fairly traded products ensures that producers receive a fair income from which they can feed themselves and their families. Long-term trading relationships and fair prices – which are generally above world market levels – help create planning security and enable producer organisations to invest in the future. Although Fair Trade products still only account for a small share of world trade, they can help make globalisation more just and dismantle inequitable global economic structures in the long term. more

World trade

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 its member states have 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 working conditions. more

Social standards: Decent work for all

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

Environmental standards: Motivating businesses to do more to protect the environment

Environmental protection measures and environmentally friendly production processes promote development and increase competitiveness in the long term, but they cost money and reduce a company's earnings in the short term. Voluntarily meeting the cost of such measures and the resulting general benefits is still considered "uneconomic" by many businesses. That can change if market forces are used to encourage businesses to do more to protect the environment. What is needed is an enabling environment that ensures that polluters pay for the environmental damage they cause. Environmental standards are an important element of such an enabling environment. Their purpose is to promote sustainable development and thus to preserve our natural resources, not least for future generations. Germany assists its partner countries in introducing such standards. more

Promoting Corporate Social Responsibility

Through its business activity any enterprise affects the conditions under which its staff live and work, as well as affecting its clients, the natural environment and the economic environment. In today's modern setting, the responsibility that goes along with this is an important corporate policy issue. Corporate Social Responsibility forms part of the vision of sustainable development on which German government policy is based. To build frameworks for action together with the private sector and improve people's lives in developing countries, BMZ supports private-sector engagement for sustainable development. more

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