As a high-level meeting of the UN General Assembly on breaking the bottlenecks to SDG investment convenes in New York, this brief explores a wide range of sources for SDG financing, as well as some challenges associated with their advancement. Data and technology continue to feature strongly in such conversations, and are also highlighted in the items below.
Oxfam released a briefing note looking at domestic resource mobilization (DRM). The paper reviews donor countries’ “track records” on their reported grants to facilitate DRM since making commitments to support the Addis Tax Initiative (ATI), as part of the Addis Ababa Action Agenda adopted at the third UN conference on Financing for Development (FfD) in 2015. The note finds that, despite a 5% increase in funds, donors are currently not on track to meet their goal of doubling support for DRM. Oxfam also flags low country ownership, and that multiple facets of equity (including gender) are neglected.
On blended finance, the Overseas Development Institute’s (ODI’s) Samantha Attridge authored a blog examining the risks and benefits of the strategy, which has been promoted by multilateral development banks as a means of enabling SDG investment in poor countries. Attridge notes that MDB portfolios risk being skewed towards more stable markets in middle-income countries (MICs), thus potentially leaving the poorest behind. She calls for de-risking mechanisms and channeling aid into programs similar to the Addis Tax Initiative.
On public finance, the Center for Global Development’s Owen Barder examines the idea of development cooperation as a win-win for donors and recipients, in a blog posted to the organization’s website. He describes two camps of thinking: some believe that “aid should never be spent in the national interest” whereas others are of the mind that “all development cooperation should be directly win-win.” Barder argues for a middle ground. Graphing the relationship between the level of altruism in development cooperation and the extent to which a policy tackles the causes, rather than the symptoms, of poverty, he explains that it may be difficult to make highly altruistic forms of development cooperation serve national interests without decreasing their impact on the ground. However, the resulting increases in stability or prosperity in the recipient country is still good for the donor country, he notes.
An EU publication presents current thinking on how to use development cooperation to promote one specific SDG – that on employment and decent work (SDG 8). The document seeks to facilitate policymakers’ understanding of barriers to decent jobs and the instruments available to boost employment levels. It notes employment constraints (i.e. imbalances of labor supply and demand), and highlights data sources on labor statistics at national and global level. The paper is part of a ‘Tools and Methods Series’ that collates and structures thematic units’ knowledge products to enhance the delivery and implementation of European aid.
On investment and a “just transition” that achieves the goals of the Paris Agreement on climate change while creating decent jobs in line with SDG 8, a research paper released earlier this month explains “Why investors need to integrate a social dimension into their climate strategies and how they could take action.” The discussion paper, authored by Nick Robins (Grantham Research Institute at the London School of Economics), Vonda Brunsting and David Wood (both at the Harvard Kennedy School’s Initiative on Responsible Investment), and published in partnership with the Principles for Responsible Investment (PRI) and International Trade Union Confederation (ITUC), offers early insights from the ‘Investing in a Just Transition’ project.
The authors note an analytical gap and lack of guidance on how investors can play a role in decarbonizing the global economy. They find that although investors are taking action to respond to climate change, most have yet to incorporate a social dimension, implying negative impacts on workers and communities. The paper identifies actions in investment strategy, investment engagement, capital allocation and policy dialogue….