This policy brief discusses the key barriers, principles, and support mechanisms for sustainable industrialisation in developing and low-income countries, focusing on the role of micro, small, and medium-sized enterprises (MSMEs) from a perspective shared by the North and the Global South. It outlines the key barriers to developing shared investment frameworks for sustainable industrialisation, including limited access to financing – especially for green projects, which disproportionally affect MSMEs – policy fragmentation and weak collaboration between state and non-state actors, which further impede coherent investment strategies; and capacity gaps regarding sustainable industrialisation policies. Overcoming these challenges requires targeted actions like enhancing infrastructure, improving green financing, policy alignment, capacity building, and fostering multistakeholder partnerships and interministerial coordination. The analysis also focuses on the guiding principles established under the Investment Facilitation for Development Agreement aimed at promoting better, higher-quality, responsible, fair, and sustainable investments, along with actionable recommendations to facilitate their implementation for human-centred investments.

The brief advocates for three main support mechanisms from a territorial, sustainable, multistakeholder, and multilevel perspective: 1) microcredit and green investment funds; 2) international and regional alliances to promote sustainable global and regional value chains; and 3) the promotion of local public policies for sustainable business management. It also highlights the need for the G20 as a key space for multilateral cooperation for the coordination of public–private policies that strengthen inclusive and sustainable governance. In this context, the Investment Facilitation for Development Agreement offers a strong institutional framework to organise and align efforts, enhancing collaboration and ensuring effective implementation. This approach aims to shift the conventional framework of international economic cooperation, which is based on a state-centric and public-centric model, towards a bottom-up strategy that emphasises sustainable industrialisation tailored to the unique needs of each region worldwide. The goal is to harness the G20’s influence to promote inclusive investment for sustainable industrialisation from a multicentric and comprehensive standpoint, engaging the efforts of diverse stakeholders.