This month, the world’s states will define a financing strategy to meet the objectives of the sustainable development goals, at the third International Conference on Financing for Development in Addis Ababa, Ethiopia. While the resources allocated to development by developed countries will not be sufficient to finance this new agenda, there is one solution to achieving the SDGs: Use part of official development assistance to leverage domestic resources available in the “global south.”
There are clearly huge financing needs. While it might seem impossible to put a cost to the annual financing needs for the SDGs, the estimates referred to here and there are startling: Several trillion dollars are required for urbanization, transport, housing, the energy transition, agriculture, the eradication of poverty, health, education, access to water and sanitation, adaptation and resilience to climate change, the protection of the environment and biodiversity, and more.
ODA flows are negligible compared with these needs: $150 billion of gross ODA and $80 billion of other non-ODA public contributions, particularly financing from multilateral development banks.
How can this impossible equation be solved?
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