Private
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Financial
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Proposal for the ‘Modernisation of Private Sector Instruments’: CSO Background Paper

This paper has been coordinated by the European Network on Debt and Development (Eurodad), with the input of various Civil Society Organisations (CSOs). It provides an analysis, with key recommendations in bold, of the proposals made by the Development Assistance Committee (DAC) secretariat in the paper DCD/DAC/STAT(2016)14: “Implementation of the Principles of ODA Modernization on Private Sector Instruments,” which unfortunately has not been made publicly available. The DAC’s proposals would allow a wide variety of 'private sector instruments' (PSI) to be used as vehicles for aid. This means an increase in the possible use of aid to invest in or give loans to private companies, or to underwrite their activities, through guarantees. We believe that these proposals are arguably the biggest change to Official Development Assistance (ODA or 'aid') rules for several decades.