Traditional philanthropy has failed to tackle issues in frontier markets, says UAE official

Private sector must adopt strategic investment approach, Badr Jafar tells World Economic Forum

Badr Jafar, UAE special envoy for business and philanthropy, has called frontier markets 'one of the greatest opportunities of our time'. Photo: Crescent Enterprise

Traditional philanthropy and aid models continue to fall short of addressing the immense challenges faced by frontier markets, Badr Jafar, UAE special envoy for business and philanthropy, said at the World Economic Forum in Davos.

He emphasised the private sector's role in fostering resilience and long-term prosperity through strategic investments in frontier economies. Those countries are home to 85 per cent of the global population.

“The private sector must go beyond conventional philanthropy and adopt a strategic investment approach, one that fosters resilience, empowers communities and delivers measurable, long-term prosperity,” Mr Jafar said during a panel session.

He described the markets as “one of the greatest opportunities of our time”, predicting that they would host 80 per cent of the global middle class by 2030. He added that humanitarian needs, which far exceed the $200 billion in annual aid, demand innovative, market-driven solutions.

“With the global impact-investing market exceeding $1.5 trillion and untapped private wealth at $450 trillion, the resources are available," Mr Jafar said. "What is needed now is a framework to align these resources with measurable development goals."

By promoting collaboration across various sectors and empowering local stakeholders, the private sector has the potential to significantly affect sustainable and inclusive development, the panel heard.

The session was part of the WEF’s Humanitarian and Resilience Investing Initiative, launched in 2019 to unlock impact investing in frontier markets. The programme brings together more than 100 partners across sectors to increase the resilience of at-risk and crisis-hit communities.

In a separate session, Mr Jafar, chief executive of Sharjah-based conglomerate Crescent Enterprises, discussed how artificial intelligence could revolutionise philanthropy and the social sector while addressing global disparities in its development and application. Despite $540 billion having been invested globally in AI since 2016, less than 0.5 per cent has been allocated to social initiatives, the session heard.

“Today, 90 per cent of AI investment flows to the Global North,” Mr Jafar said. "Meanwhile, many social innovators in the Global South – where 85 per cent of the world’s population resides – struggle with limited resources and inadequate support."

The WEF annual meeting, which this year has the theme “Inspiring Action. Driving Impact”, has brought together leaders from government, business and philanthropy. It highlights and focuses on opportunities to boost sustainable development, particularly in frontier markets.