Germany’s Federal Ministry for Economic Cooperation and Development (BMZ) has unveiled a new action plan, “Strong Partnerships for a Successful Economy Worldwide”, marking a major shift in the country’s development cooperation strategy. This plan, introduced by Federal Minister Alabali Radovan, aims to forge deeper ties between German businesses and development policy, blending commercial opportunities with sustainable development goals.
Integrating Business and Development
At the heart of the BMZ action plan is the systematic early engagement of the private sector, especially German companies and trade associations, in development project design and negotiations. The ministry intends to create structured dialogues, so economic interests are proactively aligned with development objectives. This approach is expected to generate synergies, promote knowledge sharing, and ultimately lead to higher-quality, more sustainable results in partner countries.
The plan also focuses on dismantling hurdles for German and European enterprises, such as non-transparent tender criteria and market entry barriers. By establishing fairer procurement processes and creating better market conditions, the BMZ hopes to encourage companies, especially those in the “Mittelstand” (SMEs) to invest and operate in developing and emerging economies. Incentives such as the TradeConnect guarantee instrument seek to support small-scale export and import projects, broadening market access and strengthening local value creation.
Mobilizing Private Capital
Blended finance is a central plank of the action plan. The BMZ aims to leverage private investment at larger scales, using standardized investment vehicles and collaboration with international finance platforms such as SCALED. This blended approach is anticipated to provide much-needed capital for infrastructure and climate-friendly transformations—sectors where public funds alone are insufficient to meet demand.
The ministry identifies partnership with local governments and multilateral actors as essential to facilitate investment. Priorities include legal certainty, stable tax environments, fair public procurement, and the promotion of green infrastructure. By improving these framework conditions in partner countries, the BMZ hopes to create attractive environments for both domestic and foreign investment.
Behind the bold headlines of the new BMZ action plan lies the messy, human reality of building genuine partnerships for development. The plan promises “win-win” outcomes, but creating synergy between German business and global development goals is never straightforward. In boardrooms and ministries, hope usually meets hard limits: trust, risk, and ambition must all compete for space.
The People Behind Partnerships
Imagine a local entrepreneur in Kenya, hopeful that German investment and expertise will transform her community’s water infrastructure. She is eager to work with engineers, but worries that foreign interests might overshadow local needs. On the other side, a German SME owner trembles at the bureaucratic hurdles and unpredictability of market entry, wondering whether his team will truly be welcomed. Both are partners in theory, but only real cooperation can empower them both.
Tensions and Tough Choices
The vision sounds appealing. German quality and know-how helping solve real-world development challenges. Yet, beneath this shared narrative, the struggle is very real. Approaching reconstruction in Ukraine or energy transformation in Senegal, companies face risks that public funding alone cannot erase. Ministries try to coordinate a web of interests, hoping not to lose sight of local voices in the process.
Blended finance proposals dangle the prospect of scale. But they risk repeating old mistakes if local communities remain passive recipients, not true co-authors of “development”. SMEs, though now offered guarantees, can still be edged out by larger players or tangled in regulations that bear little relevance to actual market challenges.
Towards More Human-Centered Solutions
What might bridge these divides? Genuine partnership begins with listening—making room for local priorities, allowing space for negotiation and compromise. Success must be redefined: not by signature statistics, but by the lived improvements in partner communities and shared achievements.
- Programs should embed development and social metrics that matter to people—measured and reviewed by those who experience policy on the ground.
- Oversight bodies need teeth and inclusivity, providing communities and entrepreneurs a seat at the table for each high-level review.
- Blended finance facilities must be transparent in risk-sharing, with regular outside audits focused on impact beyond profit.
- Entry barriers must be lowered thoughtfully—empowering small local businesses through fair competition and capacity building.
- Migration partnerships should protect the dignity and aspirations of all: local reinvestment in education, ethical recruitment, and continued support for homegrown talent.
Development Policy Under Pressure
The BMZ’s pivot comes amid growing geopolitical and economic uncertainty. Nationalist trends in key partner countries, retreat of major donors, and rising global poverty and instability add urgency to the development agenda. German policymakers view investment in economic cooperation and strengthened international partnerships as both a development necessity and a means of safeguarding national and European interests.
Implementation Challenges
While the BMZ action plan offers a bold vision, its implementation poses clear challenges. Success will depend on high levels of coordination, risk tolerance, and the ability to balance diverse stakeholder interests across sectors and borders. Stakeholder buy-in, particularly from the private sector and partner governments, will be crucial for translating strategic intent into real-world impact.
Nonetheless, observers see the plan as a turning point: Moving German development cooperation into closer alignment with economic actors and making it a more potent driver for more sustainable growth, resilient supply chains, and global stability.
Get more from: BMZ-Aktionsplan „Starke Partnerschaften für eine erfolgreiche Wirtschaft weltweit“, Oktober 2025, https://www.bmz.de/de/starke-partnerschaften-269800