The business case for international aid spending
UK development spending is good for British business. I know, I’ve seen it first hand, writes Co-op policy director Paul Gerrard
Every business knows that smart investment and wise spending boosts the bottom line.
That’s true on a global scale.
UK international development and aid spending is good for UK business when it’s done right. By tackling poverty, preventing instability and supporting sustainable growth overseas, targeted aid spending and development finance helps build a safer, healthier and more resilient world. That’s a world in which UK businesses can export, trade and flourish.
So I’m proud that the Co-op, alongside the CBI, is a founding member of a new initiative – the Business Alliance for Global Development.
Together UK businesses and the organisations that represent them can show that international development is not about empty virtue signalling or speculative spending in pursuit of warm and fuzzy feelings. Though let’s be clear, virtue is worth celebrating and warm and fuzzy feelings are not mutually exclusive to doing business.
Well thought through and targeted development spending strengthens resilience at home and abroad by fostering stability, smoothing trade and supporting British jobs. That may be via health spending that reduces the risk of another pandemic. It could be via conflict resolution that saves lives and opens new markets. It may be by rooting out illicit finance. It all helps to reinforce the UK’s reputation as a trusted, leading and responsible partner – the sort of market and entity that others want to do business with.
This isn’t just theory. I’ve seen it first-hand.
Eighteen months ago I went to Kenya to visit a range of our Fairtrade suppliers and saw the way investment in the latest technology, alongside investment in local communities creates sustainable and highly successful businesses. The businesses I visited recognised that ensuring education for the children of their workforce or access to clean water would help them be more successful as a business because they could not only attract the best workers but also plan for the long-term.
The kind of societal and economic stability that such investment brings means we can do business with them, and our customers benefit because they can rely on the quality and security of supply. Such stability is fundamental to creating the good business conditions we all need but it doesn’t happen by accident – it needs choices and investment. Our experience in the Co-op shows that it is really worth it.
My fellow business leaders agree. The Business Alliance for Global Development’s first step has been to commission Merlin Strategies to poll 500 business leaders. And the results showed there is a need and a desire for just such an initiative.
The vast majority – 84 per cent – of business leaders agree that it is important that the UK remains engaged in supporting developing countries through overseas aid partnerships. One in three identified UK trade and exports as the main benefit from the UK’s role as a global development partner. Eight out of 10 agreed that the UK’s international aid spending strengthens the UK’s global influence and reputation.
And 68 per cent said greater collaboration between UK businesses and UK government on international development programmes would be good for their business. That last stat is interesting for a number of reasons. Firstly, the proportion didn’t alter no matter the size of business from SME through to blue chip multinational. Secondly, the government has been making positive noises about increasing international development spending again. When minister Kirsty McNeill recently pledged to revisit and reverse cuts to spending on international aid and development she was not veering from the administration’s core aim of economic growth. And thirdly the UK takes on the presidency of the G20 next year hosting a summit of world leaders in Manchester – home of the Co-op. This is a golden opportunity to model collaboration between government and business at home and develop co-operation abroad to strengthen economies and trading partners and create opportunity for UK business.
The Business Alliance for Global Development is committed to marrying efficient and targeted spending abroad with British business success that creates and supports jobs in the UK.
We have an opportunity and a responsibility to make the case that smart aid and development finance not only saves lives but also supports British innovation, trade, jobs and growth. I look forward to others joining and backing the British Alliance for Global Development principles as we grow the organisation and the economy.
Paul Gerrard is the director or public affairs and policy at Co-op