IFAD Private Sector Engagement Strategy 2019-2024

The five principles of IFAD's engagement with the private sector proposed in this Private Sector Strategy are relevance, additionality, development impact, risk, and environmental, social and governance (ESG) standards.

IFAD will carefully assess and mitigate all the risks stemming from engaging with the private sector, including reputational and financial risks, and those related to mission-drift and institutional capacity.

The PSS has two main objectives:

1. mobilize private funding and investments into rural micro, small and medium-sized enterprises (MSMEs) and small-scale agriculture; and
2. expand markets, and increase income and job opportunities for IFAD's target groups.

To achieve these, four actions are envisaged:

• Deploy financial instruments that play a catalytic role in directing private sector financing into rural MSMEs and small-scale agriculture;
• Use IFAD's programme of loans and grants (PoLG) to crowd in private sector investments by systematically scanning IFAD's portfolio and pipeline to identify investment opportunities for international and domestic private sector actors;
• Develop inclusive value chains with private sector partners to foster the expansion and replication of the Fund's public-private-producer partnership (4P) approach to more projects and countries; and
• Test and scale up new technologies and cost-effective solutions by seeking to partner with companies that can address long-standing challenges faced by small-scale producers and poor rural men and women.