The 2023 Financing for Sustainable Development Report: Financing Sustainable Transformations warns of a lasting sustainable development divide as SDG financing needs are growing but development financing is not keeping pace. It calls on the international community to align financing with sustainable development by combing three sets of actions. First, scale up development cooperation and SDG investment. Second, strengthen the international financial architecture. Third, accelerate national sustainable industrial transformations.
The 2022 FSDR recommends three sets of actions that can help to make progress in bridging the finance divide. First, the report calls for urgent measures to address financing gaps, rising costs of borrowing and heightened debt risks. There is a need to increase public financing for investment in public policy priorities and effectively spend mobilized resources on the SDGs and productive investment. The international community should work to reduce borrowing costs and volatility from commercial sources; and address debt overhangs to reduce debt burdens. Beyond urgent actions, all financing flows must be aligned with sustainable development. We must address climate change and inequalities head on to preserve economic prospects. Finally, enhanced transparency and a more complete information ecosystem will strengthen the ability of countries to manage risks and use resources well and in line with sustainable development.
The 2021 Financing for Sustainable Development Report (FSDR) of the Inter-agency Task Force on Financing for Development warns that COVID-19 could lead to a lost decade for development. The report highlights the risk of a sharply diverging world in the near term where the gaps between rich and poor widen because some countries lack the necessary financial resources to combat the COVID-19 crisis and its socioeconomic impact. Short-term risks are compounded by growing systemic risks that threaten to further derail progress, such as climate change. The report recommends immediate actions to prevent this scenario and put forward solutions to mobilize investments in people and in infrastructure to rebuild better. It also lay outs reforms for the global financial and policy architecture to ensure that it is supportive of a sustainable and resilient recovery and aligned with the 2030 Agenda.
The global economic recession and financial turmoil from COVID-19 are derailing implementation of the Addis Ababa Action Agenda and achievement of the Sustainable Development Goals (SDGs). Even before the pandemic, the 2020 Financing for Sustainable Development Report (FSDR) of the Inter-agency Task Force noted that there was backsliding in many areas. Due to the COVID-19 crisis, global financial markets have witnessed heavy losses and intense volatility. Particularly worrisome is the prospect of a new debt crisis. The FSDR highlights both immediate and longer-term actions, including arresting the backslide, to respond to the COVID-19 crisis.
The 2019 Financing for Sustainable Development Report (FSDR) of the Inter-agency Task Force on Financing for Development warns that mobilizing sufficient financing remains a major challenge in implementing the 2030 Agenda for Sustainable Development. Despite signs of progress, investments that are critical to achieving the Sustainable Development Goals (SDGs) remain underfunded and parts of the multilateral system are under strain.
The 2018 report of the Inter-agency Task Force on Financing for Development finds that most types of development financing flows increased in 2017, and that there has been progress across all the action areas of the Addis Ababa Action Agenda. This progress was underpinned by an upturn in the world economy, but at the same time the report warns that risks could derail development progress and structural impediments continue to undermine sustainable development prospects.
In 2016, the first full year of implementation of the Addis Ababa Action Agenda, efforts have begun at all levels to mobilize resources and align financing flows and policies with economic, social and environmental priorities. Progress can be reported in all seven action areas of the Addis Agenda. Nonetheless, a difficult global environment has impeded individual and collective efforts, and many implementation gaps remain. The Addis Agenda offers a broad framework for individual actions and international cooperation to increase sustainable development investment, stimulate global growth and advance the world towards achieving the Sustainable Development Goals (SDGs). Its rapid implementation is therefore more important than ever.
The first edition of the report of the Inter-agency Task Force on Financing for Development maps out the commitments and action items contained in the Addis Ababa Action Agenda and lays out how the Task Force will monitor their implementation in future years.