“Achieving the economic transitions needed to reach the SDGs will require investments at unprecedented scale.” This is according to the 2024 Financing for Sustainable Development Report (FSDR 2024), which estimates SDG financing and investment gaps at between USD 2.5 trillion and USD 4 trillion annually. The report proposes a more responsive financial system that scales up investment in the SDGs and is better equipped to respond to crises.
Themed, ‘Financing for Development at a Crossroads,’ FSDR 2024 shows that financing gaps were already large before 2020. However, since the COVID-19 pandemic and subsequent shocks, including rising geopolitical tensions and a global cost-of-living crisis, the financing gap of developing countries grew significantly.
“We are truly at a crossroads and time is running out,” warned UN Deputy Secretary-General Amina Mohammed, launching the report. “Leaders must go beyond mere rhetoric and deliver on their promises. Without adequate financing, the 2030 targets cannot be met,” she said.
FSDR 2024 finds that debt burdens and rising borrowing costs are large contributors to the crisis, reversing hard-won development gains, particularly in the poorest countries. Estimates indicate that the annual debt servicing cost in the least developed countries (LDCs) will be USD 40 billion between 2023 and 2025. This is up more than 50% from USD 26 billion in 2022. Today, LDCs spend 12% of their revenues on interest payments – four times more than ten years ago – and around 40% of the global population live in countries where government spending on interest payments is greater than that on education and health. Stronger and more frequent climate change-related disasters are responsible for more than half of the debt increase in vulnerable countries, according to the report.
While Official Development Assistance (ODA) from Organisation for Economic Co-operation and Development (OECD) countries reached an unprecedented USD 211 billion in 2022, from USD 185.9 billion in 2021, the total amount remains inadequate for development as aid to refugees living in donor countries accounted for much of the growth, the report finds. It notes that only four countries – Luxembourg, Sweden, Norway, and Germany – met the 0.7% of gross national income (GNI) target in aid in 2022.
Highlighting the Summit of the Future in September as a moment to change course, the report seeks to contribute to the Fourth International Conference on Financing for Development (FfD4) in June 2025. A press release from the UN Department of Economic and Social Affairs (DESA) identifies FfD4 as an opportunity for countries to:
- Close credibility gaps and rebuild trust in multilateralism;
- Close financing and investment gaps, at scale and with urgency;
- Reform and modernize the outdated international financial architecture and adjust international rules for trade, investment, and finance; and
- Formulate and finance new development pathways to deliver on the SDGs and ensure no one is left behind.
Launched on 9 April 2024, the report was produced by the Inter-agency Task Force on Financing for Development (IATF), comprised of more than 60 UN agencies and international organizations. DESA’s Financing for Sustainable Development Office coordinates the Task Force, in close cooperation with the World Bank Group, the International Monetary Fund (IMF), the World Trade Organization (WTO), the UN Conference on Trade and Development (UNCTAD), the UN Development Programme (UNDP), and the UN Industrial Development Organization (UNIDO).
The report will inform discussions during the 2024 session of the UN Economic and Social Council (ECOSOC) Forum on Financing for Development Follow-up, also known as the FfD Forum, where Member States discuss ways to mobilize sustainable financing. The report will also support the SDG Investment Fair. Taking place concurrently with the FfD Forum, the event will bring together governments and investors to explore sustainable investment opportunities that support the achievement of the SDGs. [Publication: Financing for Sustainable Development Report 2024: Financing for Development at a Crossroads] [Publication Landing Page] [DESA Press Release] [UN News Story]