The development of a vibrant and dynamic private sector is crucial for sustainable economic growth and is a prerequisite for poverty reduction. To stimulate private sector-led growth, investment opportunities are required, complemented by the availability of investment capital, appropriate legal and policy frameworks, involving both legislation and institutions, and proper functioning labour markets. Governments should be strengthened in order to develop sound legal and market institutions, thus enhancing their capacity to regulate the private sector.

The government’s role is being redefined and shifted from ‘producer-owner’ to ‘facilitator-regulator’, as a result of which the private sector now has to be the engine of strong and sustained economic growth. Enterprises previously owned by the state and managed by the government are now being transferred to the private sector, either fully or partially, with full management rights. While the state still continues to own enterprises, attempts are being made to commercialize enterprise operations and impute modern ‘best practice’ business methods. Just as good governance is crucial to public administration, the quality of corporate governance practices in the private sector is essential for a well-functioning private sector.