The role of the private sector (and particularly that of transnational corporations) in the achievement of international development objectives has long been a focus for academic debate and the source of much controversy. Recently, the dominant perspectives oninternational business have shifted from an often antagonistic questioning of the impacts and intentions of transnational investment in the developing world to an increasing engagement between international institutions, governments and corporations and strong advocation of market-led private sector solutions over state intervention and regulation. Most recently, there have been calls for a deepening of engagement with the international business sector as away of dealing with the problems of development finance, in particular meeting the Millenium Development Goals.

Whilst the importance of further explorations of the ways in which state and private sectors can best complement each other in achieving development objectives is clear, this paper is intended to sound a word of caution about these developments. In particular, questions need to be raised about the contrasting impacts of different types of private sector engagement in development and the importance of understanding the political and historical context of market reforms and the promotion of transnational investment. The paper argues thatblindness to context has led to the dominance of a corporatised form of privatisation that too often stifles the potential of more localised embodiments of the private sector