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The Emerging Role of the Private Sector in Delivering Social Services in the ESCAP Region

Economic and Social Commission for Asia and the Pacific (ESCAP)
Social Policy Paper No. 4

This paper elaborates on the current approaches in viewing the private sector as either a partner or a separate entity in delivering such basic social services as education, health care, water and sanitation. The term private sector is inferred to include: (a) for-profit private business/corporate entities, and (b) not-for-profit non-governmental organizations (NGOs). It highlights the changing role of the different stakeholders, with special focus on the for-profit private sector in delivering social services and how public sector participation can be supplementary to that emerging role in the years after the Copenhagen Declaration. The emergence of the non-governmental sector, particularly not-for-profit NGOs, as an active participant in the delivery of social services is extensively analysed. The paper also provides an analysis of the growing importance of the for-profit private sector in the delivery of social services among subgroups of countries in the region. As the role of the private sector is linked to the stage of development of a specific country (and therefore of its own private sector), the paper examines the feasibility of involving the private sector in the delivery of social services, including employment creation for the poor. Here it is found that not-for-profit NGOs are emerging as important players and are increasingly undertaking commercial activities. In most countries in the region, the private sector may not be willing to undertake the production/delivery of such services if clear criteria for earning a profit do not exist. At the present state of the development of the private sector in the developing countries of the region, the establishment of appropriate regulatory mechanisms to ensure
that services are delivered to the intended beneficiaries appears to be a distant possibility. The paper concludes by providing some policy options to develop effective national policies and suggests a regional framework for further cooperation in promoting the role of the private sector in delivering social services.

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