New SDG Impact Investment Toolkit coming soon
SDSN's Index Team is proud to announce that IDB has launched a walkthrough video of a new online toolkit, a big step in a long and fruitful collaboration between SDSN and IDB.
The COVID-19 pandemic is a serious setback for sustainable development. Most countries in Latin America and the Caribbean have been hit hard by the pandemic with a significant death toll as well as with other negative economic and social consequences. At the same time, the SDGs provide an inclusive framework for post-COVID-19 economic recovery, and for development decoupled from negative environmental impacts. SDG 3 calls to “strengthen the capacity of all countries, in particular developing countries, for early warning, risk reduction and management of national and global health risks”.
In 2019, assessments by the International Monetary Fund, the United Nations Sustainable Development Solutions Network (SDSN) and others confirm that the SDGs can be financed at a cost of about 2% of global gross domestic product, with around 0.4% in development aid to fill the gaps in lower-income countries. Ambitious goals unleash innovations to accelerate progress and bring down costs, particularly through the use of new technologies. Multilateral Development Banks (MDBs), including the Inter-American Development Bank, can play a central role in supporting a sustainable, inclusive and resilient recovery from COVID-19 aligned with the SDGs.
Many LAC countries do better than Asian economies in decoupling rising economic living standards from greenhouse gas emissions. This is principally due to a large share of renewable sources in the electricity mix and lower industrial activity. However, no country in the region is on track to achieving net zero emissions by mid-century, as required under a 1.5°C pathway (Masson-Delmotte et al., 2018). The region has experienced the most dramatic decline in biodiversity1 (IPBES, 2019; WWF, 2018). Deforestation rates remain relatively high. In 2020, deforestation rates in Brazil’s Amazon further rose by about 10% (Taylor, 2021).
In order to support the investment decision of investors interested in IDB projects, SDSN has developed an SDG Impact Investment Toolkit to provide information on the potential impact of projects in the infrastructure, social, financial and private sectors. To this end, SDG scores obtained from the analysis of the Sustainable Development Report (Sachs, Schmidt-Traub, et al., 2020) and the SDG Index for Latin America and the Caribbean (Cods, 2020) were combined with current and trend data on sector quality, investment levels, and the investment environment to assess which projects can have a higher impact depending on the national context.
The toolkit features an impact explorer that lists the countries, sectors, and subsectors where an investment may have the greatest impact potential. This list can be filtered by country, by sector and subsector, and by SDG. It can be used by investors who are looking to invest in projects focused on a specific Sustainable Development Goal.
The SDG Impact Investment Toolkit is scheduled to be launched for the beginning of 2022.
About the Inter-American Development Bank
The IDB Group is the leading source of development finance for Latin America and the Caribbean. It helps to improve lives by providing financial solutions and development knowhow to public and private sector clients. The group comprises the IDB, which has worked with governments for 60 years; IDB Invest , which serves the private sector; and IDB Lab , which tests innovative ways to enable more inclusive growth.