As donors move toward more constructive engagement in post-conflict states, a growing body of research has recognized the importance of the private sector. Businesses can create jobs for frustrated citizens, bridge social divides and contribute to the economic growth necessary to support lasting peace. However, private sector-led development is a relatively new concept in the aid world, and even less tested in fragile environments. What methods work best? How can donors ensure that their programmes are effective while balancing heightened risks, limited local capacity and higher costs of engagement? In this paper, we discuss insights to these questions, drawing on our experience implementing the post-conflict windows of the African Enterprise Challenge Fund.
