With trillions needed to achieve SDGs, world leaders urged to rapidly scale up investments
New York, 20 September – Recognizing the urgency of delivering on the Sustainable Development Goals (SDGs) by 2030, world leaders gathered at the UN High-level Dialogue on Financing for Development in New York today to present innovative and practical solutions to unlock better financing and tackle the great finance divide that has emerged between developed and developing countries.
The great finance divide
Nearly 40 per cent of all developing countries suffer from severe debt problems. These countries cannot fund progress on the SDGs if they are facing exorbitant borrowing costs and paying more on debt servicing than on health or education. “Developing countries face borrowing costs up to eight times higher than developed countries – a debt trap. And one in three countries around the world is now at high risk of a fiscal crisis. Over 40 per cent of people living in extreme poverty are in countries with severe debt challenges,” warned UN Secretary-General António Guterres.
Held every four years since 2015, following the adoption of the Addis Ababa Action Agenda — the roadmap for financing the SDGs — the 2023 High-level Dialogue on Financing for Development takes place at a critical moment, when only around 15 per cent of SDG targets are on track. While progress has been made across all action areas of the Addis Ababa Action Agenda, many of its commitments remain unmet. Moreover, challenging economic prospects amid the lingering effects of the COVID-19 pandemic, conflicts and intensifying climate change have put financing for the SDGs under increased pressure. As part of the 78th session of the United Nations General Assembly, the High-level Dialogue reviews progress towards achieving the Addis Ababa Action Agenda and mobilize political support at the highest level to finance sustainable development, building on fresh commitments made at the 2023 SDG Summit to turbocharge SDG action.
SDG financing requires innovative approaches
Aggressively scaling up SDG financing will require innovative approaches, bold policy decisions, and new sources of funding. Member States welcome the UN Secretary-General’s proposal for an SDG Stimulus of at least $500 billion US dollars per year to significantly increase affordable, long-term financing for development. They also support his call for deeper and longer-term reforms to the international financial architecture, which currently fails to serve as a safety net for all countries and exacerbates inequalities. “It is clear that the systemic problems of financing for sustainable development require a systemic solution: reforms of the global financial architecture,” said the UN Chief, calling for a new Bretton Woods moment when countries can come together to agree on a global financial architecture that reflects today’s economic realities and power relations.
Financing the SDGs for a world where no one is left behind
Under the theme “Financing the SDGs for a world where no one is left behind”, the one-day event will feature creative, ambitious and politically feasible solutions by world leaders, heads of international financial institutions and multilateral development banks (MDBs), representatives of the private sector and civil society to mobilize resources, generate action and restore momentum to achieve the SDGS. Echoing calls from the UN Secretary-General, the 2023 High-level Dialogue will feature two interactive roundtables to explore solutions to reform the international financial architecture to achieve the SDGs and to unlock SDG investments. In the first roundtable, leaders and eminent experts will consider ways to foster debt sustainability, strengthen the global financial safety net, promote inclusive and effective international tax cooperation and mobilize domestic resources. The afternoon roundtable will focus on ways to scale up private finance and affordable and accessible international public financing for sustainable development. It is critical to boost financing from all sources as well as to develop new policies and strategies to align such flows with the SDGs. Increased multilateral development bank (MDB) lending and a growing recognition of the important role of public development banks (PDBs) have helped meet increased demand for financing. Massive private capital mobilization is also needed to close the gap. High-level representatives from multilateral development banks and the private sector, including the Managing Director of the IMF, the President of the World Bank and the Director-General of the WTO, will deliver keynote remarks. Heads of State and Government will also speak about their experiences and commitments. Civil society organizations, including the High-Level Panel on Illicit Financial Flows from Africa, Tax Justice Network Africa, and the Alliance for Financial Inclusion will join the Dialogue to discuss topics including, promoting inclusive and effective international tax cooperation. Building on the outcome of the 2023 ECOSOC Forum on Financing for Development follow-up, the 2023 High-Level Dialogue will feed into the annual meetings of the IMF and World Bank Group in October this year and pave the way for the Summit of the Future to be held in 2024.
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