Road to the 2019 UN ECOSOC Forum on Financing for Development
The ECOSOC Forum on Financing for Development (FfD Forum) is an intergovernmental process with universal participation mandated to review the Addis Ababa Action Agenda (Addis Agenda) and other financing for development outcomes and the means of implementation of the Sustainable Development Goals (SDGs).
This year’s forum comes amidst severe global and social challenges including the deteriorating national debt positions with over 40% of low-income countries facing severe debt sustainability challenges. Further to this Official Development Assistance has been reducing with increasing push towards the promotion of private sector finance as the model for financing development. Taxation as the most sustainable way of financing development continues to be elusive especially for most LDCs facing high rates of Illicit flows and weak mechanisms to tackle the vice both domestically and internationally in addition to unbalanced trade systems. Beyond this, the ever-increasing high premium being placed on PPPs as the solution to infrastructure financing, blinds its contribution to increased debt burden by most LDCs. Most importantly is the story of leaving no one behind and ensuring that the poor and marginalized groups actually benefit from development financing.
According to the draft 2019 Inter-Agency Task Force (IATF) Report on Financing for Development, 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. Interest in sustainable financing is growing, but the sustainability transition in the financial system is not happening at the required scale. Systemic risks are rising and parts of the multilateral system are under strain.
Civil Society Partnership for Development Effectiveness working with other partners such as the Society for International Development has been engaging on the processes to try and influence content of the final outcome report but also the process especially in terms of facilitating for inclusive participation of non-governmental actors.
In this regard a team of CSOs including myself was tasked to undertake pre-forum advocacy engagements which saw the team meet up with a number of country delegations/missions on specific issues which included the Zambian and Italian missions to the USA as the co-facilitators of the 2019 FfD Forum, the European Union, the Canadian mission to the USA, the Nigerian Mission to the USA among others. This was followed up with our participation in the Friends of Monterey Retreat in Mexico under the auspice of the Mexican government. This is a space that accords countries to discuss freely the issues around financing for development under the Chattem house rules and provided an excellent opportunity for CSOs to not only engage but also provide input into the recommendations for the FfD final report.
The FfD Forum will be held from 14th to 19th of April 2019 and is expected to adopt intergovernmental agreed conclusions and recommendations, which will feed into the High-Level Policy Forum and the High-level dialogue. On the Agenda of the FfD forum is that While continuing the review of all action areas of the Addis Ababa Action Agenda, the Forum will place an emphasis on the following issues:
I. Emerging trends and risks: Financing the SDGs is taking place in a dynamic environment. Emerging mega trends and rising risks maximize the negative impact of the structural impediments to financing for development. The Forum will highlight such trends and risks as well as policy implications for international financial, monetary and trading systems in relation to financing the SDGs.
II. Promoting inclusive growth and reducing inequalities: Inequality is a drag on growth, undermining faith in the social contract. It is a clear obstacle to the achievement of the SDGs. Underrepresented and marginalized groups—including women and youth, among others-- suffer disproportionately from poverty and are often excluded from basic services, financial systems and work opportunities. National policies and institutions play an important role in shaping inequalities. The Forum will feature policies that can ensure fiscal and financial systems actively promote greater equality, particularly for women, youth, and marginalized groups.
III. National policy space and financing framework: The changing trends pertaining to global trade, investment and debt have implications for policy options at the national level. The Forum will create the opportunity to share national policies, tools and experiences to expand the space to mobilize domestic public and private resources to finance the SDGs.
IV. Mobilizing finance for climate action: Climate action and economic growth can be complementary. Mobilizing finance for climate action, including through investments in climate mitigation and low-carbon growth, is critical for building resilience to climate shocks and achieving the SDGs. Such investment is not only an economic choice but also a political one. The “smart” policy choice and “right” balance in this investment (mitigation and adaptation) can vary with country context. The Forum will unpack the nexus with country cases.
V. Mobilizing long-term investment for the SDGs: Achieving the SDGs requires the mobilization of investment at an unprecedented scale. Public investment, while of great importance for a number of countries, will on its own be insufficient to address this challenge which, in turn, necessitates efforts to scale-up private investment. At the same time, there is a need for private investors to a shift towards a longer-term investment horizon and incorporate sustainability into their business models. The Forum will also review the progress of current efforts to better align the financial system with the 2030 Agenda through better incentivizing the provision of long-term finance aligned with sustainable development.
VI. Innovation and frontier technologies: The fast-paced financial, business and industrial innovations provide possibilities for developing countries to leapfrog the development ladders. In the meantime, policies and regulations must strike a balance in reaping their benefits while minimizing their negative impact on financing the SDGs. The Forum will feature initiatives and draw conclusions and recommendations.
The CPDE in addition to participating in the forum will also Co-host CSO FfD side event on ‘Reaching the furthest behind: Is blending fit for purpose?’
Under the CSO FfD group the CPDE will also be supporting the side events on the following:
· Tax and Illicit Financial Flows: Following up on FfD and SDG commitments
· Trade and Investment Policy: A Critical Ingredient in Harnessing FfD Instruments to Achieve the SDGs
· The new wave of debt and financial crises: how to tackle it?
· Sustainable Investments & Systemic Reform: Policy and Regulatory Challenges
Kryticous Patrick Nshindano
CDPE Southern Africa Sub Regional Representative.