Linkages between private sector development, conflict and peace

Question

What are the linkages between private sector development, conflict and peace in war to peace transitions?

Summary

The private sector can both exacerbate drivers of conflict and contribute to peacebuilding in post-conflict states. Examples of the role that the private sector can play in conflict and peace at the macro, meso and micro levels include the following:

Macro level

There is a general consensus in the literature that illicit trade in natural resources can increase in the post-conflict period, due to factors including limited employment opportunities for ex-combatants. The research undertaken for this report did not uncover any examples of positive transformations of key industries in post-conflict situations.

Meso level

  • Business participation in mediation processes: In Colombia business leaders were members of negotiating teams, but their limited involvement meant that they became disillusioned with the peace process.
  • Advocating for peace: In a number of countries business leaders have engaged in lowlevel shuttle diplomacy between groups in conflict in order to push for peace. The extent to which such initiatives have been successful is unclear.
  • Business associations: Such associations have in some cases attempted to contribute to peace and stability by lobbying governments. The degree of their success is difficult to establish, due to challenges relating to establishing causality.

Micro level

  • Cross-border trade initiatives: Programmes like ‘Trading for Peace’ in DRC appear to have had some positive impact on peace and stability.
  • Disarmament, Demobilisation and Reintegration (DDR) support: In Afghanistan, businesses provided support for DDR by providing employment and training opportunities for ex-combatants through the Afghanistan New Beginning Programme. Ex-combatants were also provided with support in starting their own businesses. The latter initiative had a high failure rate due to factors including the small size of the initial start-up grant and most recipients’ limited ability to manage credit.
  • SMEs: SME peacebuilding activities have had some success in contributing to peace and stability in post-conflict countries. However, it is difficult to determine to what extent these activities are responsible for positive change because causality is hard to establish. There is a relatively small body of literature on the role of the private sector in building peace. Most of the evidence takes the form or NGO and international organisation reports and evaluations. Examples of successful interventions are often dated and evaluations lack rigour. Analysis of success factors is also lacking. It is therefore difficult to establish causality between many of the initiatives discussed in this report and improvements in peace and stability. There is very little literature looking at private sector involvement in peacebuilding in post-conflict Least Developed Countries (LDCs).

There is a relatively small body of literature on the role of the private sector in building peace. Examples of successful interventions are often dated and evaluations lack rigour. Analysis of success factors is also lacking. It is therefore difficult to establish causality between many of the initiatives discussed in this report and improvements in peace and stability. There is very little literature looking at private sector involvement in peacebuilding in post-conflict LDCs.

Enquirer:

Suggested citation

Strachan, A.L. (2017). Linkages between private sector development and peace. K4D Helpdesk Report. Brighton, UK: Institute of Development Studies.