Why private sector is key to American diplomacy
March 26th, 2013
10:25 AM ET

Why private sector is key to American diplomacy

By John Hamre and Rhonda Zygocki, Special to CNN

Editor’s note: John J. Hamre is president and CEO of the Center for Strategic and International Studies. Rhonda I. Zygocki is executive vice president of policy and planning at Chevron Corporation. The authors were members of the CSIS study’s Executive Council on Development. The views expressed are the writers’ own.

The world’s population is expected to grow to 9 billion in the next forty years, which will inevitably increase demand for food, water, land, energy and jobs. Such challenges will be closely connected to the United States’ economic and national security. Yet improving capacity to meet basic human needs will require more than just public assistance.

Now, more than ever, it is critical that America engages in trade, investment and development assistance. But while much of the nation’s engagement in these areas has until now been facilitated by the U.S. government, the current budget environment means that some of the best new opportunities lie in catalyzing the strength and drive of the private sector.

U.S. businesses, in particular, are ambassadors of American values and are more engaged in the economies where they operate, especially in the rapidly growing markets of Africa, Asia, Latin America and the Middle East. By putting those values into action, the private sector can serve as the leading edge of American influence by promoting entrepreneurism; empowering communities; and demonstrating all the advantages of contracts, competition, transparency and fair dealing in the marketplace. Capitalizing on these opportunities will not only improve the lives of those in the developing world, but also improve America’s economic future and national security.

U.S. foreign assistance is and will continue to be an important arm of our diplomacy. However, we need to use it in new ways that highlight the importance of economic growth as the core principle of our overall development policy. We can do this by strategically and systematically deploying the considerable resources in our private sector – technology, capital and human resources – in combination with our government efforts around trade, investment and development.

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In 1960, government funding accounted for 71 percent of financial flows to developing countries; today it is 9 percent. Private capital alone is now 50 percent of financing flowing into developing countries. By deepening our partnerships between the public and private sectors through early engagement and continual communication, creating more flexibility in our global development tools and policies, and using trade relations as bridges to long-term economic partnerships, we can work together to build a better, more secure future for both the United States and our allies in developing countries.

These opportunities will help American businesses grow, increase U.S. jobs and exports, and strengthen the global system of standards and openness. They will also create important avenues to work with governments in developing economies to build the social, physical, and institutional infrastructure that will continue to promote growth and engagement in developing economies. And, importantly, these opportunities can make significant contributions to the reduction of poverty and the improvement of people’s lives abroad. But to ensure such benefits are realized, the U.S. government and the private sector need to set a new course for public-private partnerships.

During her tenure, former Secretary of State Hillary Clinton recognized the unique attributes of the private sector, and, moreover, the importance of engaging them to restore America’s leadership in global development. “[Y]ou cannot have development in today’s world without partnering with the private sector, and that has been our mantra, and we are now creating examples,” she noted.

The opportunity has never been better for the U.S. government to utilize its relationships with the private sector to help build better, safer and healthier societies around the world. The question is whether it will take the initiative in trying to meet what is America’s key leadership challenge for the 21st century.

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Topics: Diplomacy • Economy • United States

soundoff (15 Responses)
  1. 100 % ETHIO

    Those....who are pushing the private sector agendas in foreign Countries are dangerous and the consequences to US will be harsh criticisms and unfriendly between America and others.

    Those individuals/private sectors, cares only what they could get to fulfil their own self, but not for US.

    For example, since the late 1970's, Jewish who escaped from Europe to seek shelter/refuge in US, they were welcomed to America.
    But, few years after they were being rehabilitated, they started complain about US. They used American Passports to hurt other Countries and damaging US relationships with other Countries. Jewish recruited and collaborated with others to harm US interests, everywhere.

    1) In 1970's, Jewish concluded that, their long-term secret plans reached to overthrow the Monarchs in Ethiopia, and they got succeed.
    Then, Jewish meddled to cause internal affairs among Ethiopians, by using American Passport as diplomats.

    In 1990, during the Gulf-war, Jewish Man, American Ambassador in Ethiopia, Ambassador Herman Cole, secretly diverted American Soldiers with heavy Weapons, through Sudan into Ethiopia, to Bombed the former Junta Militarily regime, and he got succeeded.

    Soon after Jewish got free movements in Ethiopia, they stole and shipped-out many of well kept old Ethiopian Antiques,...
    They also stole Billions of Dollars Cash, Gold and other Minerals, and distributed into other Jewish, who becomes Billionaires and Millionaires, right now.

    Private Sectors, they will put American Government in trouble, for their own benefits.
    Other Countries, they have natural resources to export, but Jewish does not. That is why they keep pushing private sector agendas.
    They(Jewish) already pushing hard Sodomy(unchristian), to rise, for their own benefits.

    Wake-up, America!

    March 26, 2013 at 1:12 pm |
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      April 7, 2013 at 9:31 am |
  2. JAL

    Chase bank has an initiative to hire 100,000 people. I am looking for other companies doing the same sort of thing. If they make good on this goal, then I am proud of Chase bank. These sort of initiatives need big light.

    March 26, 2013 at 5:12 pm |
    • JAL

      C'mon Fortune 500 CEO's! Show us your new solutions! I know some companies have great things planned. Start by showing us your hiring plans!!

      March 26, 2013 at 5:15 pm |
  3. me

    You can say what you think about the effectiveness business growth has on other countries and it sounds sweet to think it will all work out. Just remember it was the American taxpayer that save the largest capitalist country on the planet. Everything has limits and when things start to fall apart because of poor oversight of really greedy people in a capitalistic society. They don't even go to jail when they screwup, what happened in America and is still happening can't be allowed to happen again. If capital investment is going to made in these other societies then there had better be really good oversight of what these business people do with the corporate expansion into developing markets. Bottom line though if your creating American jobs then your hurting the economy that needs to stay strong. America's economy.

    Don't mind me just doing a little verbal rambling.


    March 27, 2013 at 12:55 am |
    • me

      I have to correct what I said in regards to the creating jobs part. If your investing in developing markets then you should be expanding opportunities within the United States as well. It is the largest free market on the planet and should remain strong and industrious. The American consumer is who is needed to rebound the current status quo. If their going to be able to spend then they need good paying full time employment.

      March 28, 2013 at 12:34 am |
  4. j. von hettlingen

    The US is not the sole player, other emerging powers follow suit as well. In some parts of the world, Hillary Clinton's examples have success, but not in the Middle East and most part of Central Asia.

    March 27, 2013 at 9:39 am |
  5. Frank Andrews

    Confessions of an Economic Hit Man is a book written by John Perkins
    Read it.

    March 28, 2013 at 8:48 am |
  6. Mark

    No, statement not correct:"During her tenure, former Secretary of State Hillary Clinton recognized the unique attributes of the private sector, and, moreover, the importance of engaging them to restore America’s leadership in global development." – but, correct: during her tenure U.S. businesses and U.S. companies lost many international markets, did not export enough, and USA imported unnecessary lots for the money USA cannot pay. She was the worse-performing Secretary of State.

    March 30, 2013 at 8:05 am |
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