Private Sector and Forcibly Displaced Communities

Unlocking Economic Growth: How the Private Sector Can Empower Forcibly Displaced Communities

By Yara Asad Abdel Monem Asad, Private Sector Development Specialist, PS4R

The private sector is positioned to help solve one of the world’s great humanitarian crises, and a major driver of poverty. Worldwide, there are more than 103 million forcibly displaced people, including at least 32.5 million refugees.

Poverty is rampant among these populations. There is a need for jobs. A key way to create jobs is to expand private sectors in communities that host the forcibly displaced. And a key way to do that is to unleash entrepreneurship – and to connect entrepreneurs with global and regional companies as customers and partners. In many cases, those global and regional companies can also help by developing and delivering tailored products and services that forcibly displaced people need.

Communities of forcibly displaced people can be stores of talent and drivers of economic growth. Many of the people in these communities bring valuable capabilities, experience, business networks, and other assets with them that, if put to work, can improve the economic landscape. Among the forcibly displaced are former business owners and capable entrepreneurs, as well as skilled workers and employees with ambition. Growth means new jobs, jobs for both the forcibly displaced and for others in their host communities, including women and other often-marginalized populations.

But most forcibly displaced people are stuck in limbo – living on humanitarian assistance and struggling to find ways to rebuild their lives and to demonstrate their socio-economic value to their host communities. Their skills, talents, and know-how largely go unnoticed or are underutilized. Despite the support of governments and aid agencies, these survivors of often perilous journeys typically live in difficult circumstances, searching for a way out.

The private sector can be that way out. In areas with concentrations of forcibly displaced people, the Private Sector for Refugees (PS4R) initiative of the World Bank finds local micro, small, and medium enterprises that are run by or employ forcibly displaced people and builds their capacity to grow. At its core, PS4R helps budding entrepreneurs and transplanted business leaders become competitive suppliers in local and export markets, then helps connect them with regional and global companies that can become their customers.

It works. We’ve contributed to matching Jordan-based producers that employ forcibly displaced people from Syria and elsewhere with regional and global markets. Sigma Detergents is a manufacturing company owned by a Syrian migrant. PS4R worked with them to make linkages to Eastern European markets so they could export their products—and grow their workforce. Al-Durra, a Syrian-owned food manufacturing company, is now working with Paramount in Canada thanks to the global facilitation. And Jerash Holdings, a women refugee-employing textile company in Jordan matched with VF Corporation, which owns major brands such as Timberland and The North Face. In Lebanon, PS4R is currently working with a pool of 100 SMEs across agri-food value chains, which will be matched with international markets for Lebanon-produced olive oil and table seedless grapes.

There is an opportunity for the private sector to start considering refugees and other displaced people as part of their value chains by doing business with their companies or facilitating access of these entrepreneurs to financing opportunities. Likewise, the financial sector should regard displaced people as clients and develop new financial products that cater to their special needs, as well as facilitate entrepreneurs’ journey toward mainstream finance. At the same time, governments and institutions have the main facilitating role by enabling inclusive regulations and ensuring their de facto implementation in smooth administrative procedures.

For many countries, migration is increasingly necessary for private sector growth. The World Bank’s World Development Report 2023 notes that in the coming decades, the share of working-age adults will drop sharply in many countries. Countries like Mexico, Thailand, Tunisia, and Türkiye may soon need more foreign workers because their populations are no longer growing.

For companies, PS4R offers an e-learning module and other resources that outline why and how to engage the forcibly displaced. Opportunities exist for business to take action that can make a fundamental difference in people’s lives. It simply requires that our mindsets about them come into line with a very promising reality of economic and business inclusion.

The private sectors in the communities that host refugees often need a boost in order to absorb new workers. In many cases that boost can come from the forcibly displaced themselves—and from the regional and global brands that become their customers and partners.

Learn more about Private Sector for Refugees (PS4R)

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