Ensuring that business can invest without fearing it will lose out on opportunities to grow because of bureaucracy, poor market access or corruption is vital to enabling economic growth.
Our work spans a wide number of different areas including infrastructure, competition, rule of law, land rights, trade and cutting red tape.
What we do
Infrastructure - such as power, roads and water - is the foundation upon which businesses can develop. We work both at national and regional levels to identify key infrastructure bottlenecks to business growth and regional market integration.
Competition plays an important role in encouraging efficiency, innovation and growth and for reducing prices for both business and household consumers. We work with civil society and competition agencies to promote better competition policy and a culture of competition.
We also work to shore up the rule of law. Uncertainty over property rights and contract enforcement deters business investment and our work has included supporting the building of business/asset registries.
Finally, we work to promote better trading conditions and opportunities for rich and poor countries alike, through international trade negotiations. Trade facilitation and trade capacity building is vital to enabling business.
The UK Government has established an advocacy fund to help developing nations participate in international trade negotiations. The fund will provide access to professional training, as well as technical, legal and logistical support to help them play a full part at crucial trade talks. Read the full business case here.
Reducing barriers, costs and risks of doing business
In many countries, unpredictable government policies, lack of infrastructure, cumbersome and expensive procedures, inefficient courts, corruption and high taxes keep many businesses small and informal so they can operate 'under the radar'. This stops them competing effectively, hiring more people and growing. Foreign investors are deterred from bringing in much needed capital, equipment and specialist skills.
The Investment Facility for Utilising UK Specialist Expertise (IFUSE) is a new initiative, funded by DFID which aims to share specialist expertise from across UK Government Departments to support investment climate reform in DFID partner countries
The UK demonstrates international best practice in a range of investment climate areas, such as regulatory reform, competition policy and customs procedures. Sharing UK expertise will help partner governments to improve their investment climate, facilitating economic growth and helping to generate the resources needed to tackle poverty. More information on the IFUSE programme
Cutting red tape
DFID works to help governments work better: getting rid of redundant rules, cutting red tape – and making regulation smarter and more effective. One example of this is help to reduce the number and cost of administrative procedures needed to start up and run a business. In Ghana in 2005 it took over two and a half months for an entrepreneur to register a business. By 2009, with DFID support, that was down to less than two weeks, with business registration up by 87% and more than 21,000 new businesses created.
Reducing corruption
We aim to drive out corruption and empower businesses to advocate for fairer treatment in their commercial courts. Examples include our support for Kosovo's business associations to argue for better, more predictable regulations, and the DFID-backed Investment Climate Facility for Africa's (ICF) help for Tanzania's judiciary to deliver commercial justice promptly, efficiently and transparently through training and the use of modern technology in courtrooms.
Rights to land for people and businesses
Millions of people do not own or have formal rights to the land on which they live and work, and this makes it difficult to plan or save for the future. The risk of losing land and property can deter people from committing their capital for longer term investment (for example, in irrigation) and make it difficult for them to borrow to do so.
Working with the Investment Climate Facility for Africa in Burkina Faso, we have helped to cut red tape: it used to take six months to transfer land and over eight months to obtain a construction permit, these delays have been cut to just 21 days and 19 days.