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SDGs Could Be Pushed 10 More Years without Immediate Action: Financing Report | SDG Knowledge Hub

by gwcmag

The UN released the 2021 edition of the Financing for Sustainable Development Report, which is published annually ahead of the UN Economic and Social Council (ECOSOC) Forum on Financing for Development Follow-up (FfD Forum). The latest report calls for fresh concessional financing for developing countries, fully funding the Access to COVID-19 Tools (ACT) Accelerator, and a range of measures for liquidity and debt response.

The 2021 FSDR identifies the risk that the COVID-19 pandemic could widen gaps between rich and poor countries. In this “sharply diverging world,” one group of countries is employing strong stimulus measures and digital acceleration to recover, while many others find themselves in a more severe cycle of poverty, hunger, debt and austerity. The authors call for immediate action as the trends could push achievement of the SDGs another ten years into the future.

The report calls on all governments to use taxes to better align behavior with sustainable development.

In addition to short-term risks, climate change and other threats are growing that could pose longer-term challenges to progress. Among the first steps urged in the report, it calls on all governments to use taxes to better align behavior with sustainable development, such as through carbon taxes.

Other recommendations follow three themes: investing in people, investing in infrastructure and innovation, and reforming the global architecture on policy and finance. On investing in people, the authors report that household vulnerability is closely linked to lack of SDG progress, and governments should prioritize spending on social protection and health.

Investing in sustainable and resilient infrastructure, the report notes, is currently “entirely feasible” in developed countries with low interest rates. Other countries need additional support in the form of very long-term sustainable finance. The authors suggest using longer-term balance sheet analysis to design instruments that reduce debt vulnerability risks while facilitating long-term investments, and accounting for long-term risks such as climate change.

Other recommendations include better leveraging public development banks (PDBs) as a tool for sustainable development investment, and facilitating a new business model for the private sector. Policymakers could take steps to ensure that businesses do not focus only on short-term financial returns for shareholders but also account for their environmental and social impacts.

Finally, on the topic of reforming global financial and policy architecture to support pandemic recovery and the 2030 Agenda, the report expresses support for:

  • an agreement on taxation for a digitalizing economy;
  • efforts to consolidate sustainability reporting frameworks and mandate a minimum level of corporate disclosure; and
  • “revamping the multilateral trading system” to make it more effective and responsive to sustainable development priorities.

The report is coordinated and edited by the UN Department of Economic and Social Affairs’ (DESA) Financing for Sustainable Development Office and is a joint product of the 60 members of the Inter-agency Task Force on Financing for Development. The authors note that the report was informed by the policy options developed through the initiative on ‘Financing for Development in the Era of COVID-19 and Beyond’ convened by the UN Secretary-General and the governments of Canada and Jamaica.

The 2021 FfD Forum is scheduled for 12-15 April in a hybrid format combining virtual means and in-person participation at UN Headquarters in New York, US. Side events will take place virtually. In December 2020 the President of ECOSOC appointed the Permanent Representatives of Fiji and the Netherlands as the co-facilitators for the outcome document of the 2021 FfD Forum. [Publication: Financing for Sustainable Development Report 2021] [UN News]

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