SDSN's Working Group on SDG Costing & Financing presents new paper at Permanent Mission of Denmark during UNGA74

SDSN's ad hoc Working Group on SDG Costing & Financing hosted an event, " The Cost of Success: Identifying SDG Financing Needs and Pathways for Low-Income Countrie s" on the 24th of September at the Permanent Mission of Denmark to the United Nations. This event launched and presented the findings of SDSN's new SDG needs assessment paper titled “ SDG Costing & Financing for Low-Income Developing Countries ”. This paper draws on existing studies and data contributions from members of the Working Group (co-chaired by SDSN’s SDG Financing Initiative with leaders from the IMF, World Bank and OECD) to present an initial estimate for SDG financing needs and the financing gap for low-income developing countries (LIDCs). Though the total SDG financing gap is daunting, on the order of an average $400 billion per year for the world’s 59 low-income developing countries (LIDCs), it amounts to just 0.7 percent of the advanced economies’ GDP, and just 0.4 percent of the world economy as a whole. In this paper, SDSN proposes a plausible portfolio of financing actions that would increase budget revenues for SDG outlays by $430 billion—enough to close the SDG financing gap in all LIDCs and end extreme poverty.

The event facilitated an engaging conversation that highlighted core topics for discussion at the 26 September High-level Dialogue on Financing for Development about policy opportunities for donor countries to mobilize and unlock additional public and private funds to fill the SDG financing gap and focus attention on prospects for collective actions at the UN.

In her opening remarks to frame the event, UNDESA’s Shari Spiegel addressed UN plans to specifically assess SDG financing needs and inform donor funding at the country level through the development of new Integrated National Financing Frameworks at the country-level.

Vitor Gaspar, of the IMF, also spoke about work to assess the financing needs of LIDCs to achieve the SDGs, while the OECD’s Jorge Madeira da Silva discussed the OECD’s work to assess resource allocation to LIDCs in order to calculate the gap between their needs and available resources.

Farah Kabir, of ActionAid Bangladesh, highlighted the need to focus development financing strategies on increased grants over loans and an over-reliance on private flows and domestic taxation. Morris Pearl, of the Patriotic Millionaires, discussed the need for high net-worth individuals to support public policies that prioritize reductions in inequality and SDG progress as a matter of self-interest as well as a moral imperative.

Trine Rask Thygesen and Jeff Sachs highlighted Denmark’s leadership role as an official donor and the importance of better targeting financial flows to LIDCs, however the two differed on their view of the role of private finance as a significant source of development funding. Ms. Rask Thygesen emphasized the need to strengthen spending strategies and investment pipelines to increase the efficacy of private financial flows. Professor Sachs emphasized the importance of using aid and public dollars, versus private, to finance key SDG sectors like health and education, and the necessity of addressing international systemic financial regulation failures that allow for profit-shifting and tax evasion, depriving many countries of valuable tax dollars.