Former Brookings Expert
Director of Data, Research and Policy - UNICEF
The start of the 21st century has been an auspicious period for global economic development. Developing economies have, on average, enjoyed faster rates of growth, lifting hundreds of millions of people out of extreme poverty. As a result, the first UN Millennium Development Goal—to halve the rate of extreme poverty between 1990 and 2015—was achieved seven years ahead of schedule.
Yet in a number of countries, growth has been fitful or has failed to take off entirely. And in others, growth has only benefited the few, leaving certain populations or subnational regions impoverished. In many cases, these places face structural challenges to growth such as conflict, a high exposure to shocks, weak institutions and governance, or entrenched discrimination.
In these very difficult environments, jump-starting inclusive growth is a prerequisite for any hopes of ending extreme poverty in the next generation. And this kind of rapid growth will require new models of cooperation between stakeholders, better ways of managing risk, harnessing new technologies, better approaches to managing resource extraction, and transformative investments.
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This essay explores the ways in which multinational corporations can invest in deals in fragile environments through partnering with governments and other actors. The essay discusses how such partnerships can best be structured and the best use of royalties, taxes and fees to improve countrywide development prospects.
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This essay shows what steps modern corporations can take, in cooperation with governments, to have a greater development impact than what either can achieve independently. It outlines what each sector can do to get more out of deals, while highlighting pitfalls that could impede cooperation on a project.