Financing for development: Addressing the cost of development finance to achieve the Sustainable Development Goals

The Intergovernmental Group of Experts on Financing for Development, Reaffirming General Assembly resolution 69/313 of 27 July 2015 on the Addis Ababa Action Agenda of the Third International Conference on Financing for Development,

Recalling General Assembly resolution 70/1, Transforming our world: the 2030 Agenda for Sustainable Development, of 25 September 2015, and relevant General Assembly follow-up resolutions,

Recalling paragraph 100 (r) of the Nairobi Maafikiano (TD/519/Add.2), which calls for the establishment of an intergovernmental group of experts on financing for development, as well as paragraph 122 of the Bridgetown Covenant (TD/541/Add.2), which states that the work of the Intergovernmental Groups of Experts at UNCTAD are important elements under the intergovernmental machinery,

Noting the internal and external challenges for developing countries to increase domestic resource mobilization,

Acknowledging the written and oral contributions from participants that enriched the debate during its eighth session,

1. Notes with concern the high cost of finance for development for developing countries, and emphasizes the need to address interconnected national, international and systemic challenges contributing to these costs;
2. Encourages more urgent and ambitious action to ensure that the international financial architecture becomes more efficient, more equitable, fit for the world of today and responsive to the challenges faced by developing countries in achieving the Sustainable Development Goals;
3. Welcomes policies at the national, regional and international levels that could contribute to addressing the high cost of development finance, including local currency lending, local currency sustainable finance instruments and vehicles, guarantees, risk- sharing initiatives and local capital market development;
4. Reiterates that public development banks play a vital role in providing affordable capital and accelerating investments in the Sustainable Development Goals, as they can provide grants, long-term concessional financing and non-concessional financing below market rates, as well as in boosting domestic resource and private capital mobilization;
5. Welcomes the growing number of multilateral development banks reporting on the implementation of the Group of 20 Capital Adequacy Framework, notes the potential of the Framework to unlock additional lending headroom over the next decade, calls on efforts to strengthen the work of multilateral development banks to deliver better, bigger and more effectively the grants, concessional loans and affordable long term loans, and calls on countries able to do so to work on the voluntary rechannelling of special drawing rights through these banks, while respecting relevant legal frameworks and preserving the reserve asset character of special drawing rights;
6. Recognizes the role of special drawing rights in strengthening the global financial safety net in a world prone to systemic shocks, and their potential contribution to greater global financial stability;
7. Welcomes the adoption of General Assembly resolution 78/322 of 13 August 2024 on the multidimensional vulnerability index, and calls for the full and effective implementation of its mandate;
8. Underscores the role of financial instruments and other innovative tools, such as sustainable debt instruments, debt-for-development and debt-for-climate swaps, where appropriate and on a mutually agreed, transparent and case-by-case basis, and climate resilient debt clauses, guarantees and subsidies, in addressing the high cost of finance in developing countries to achieve the Sustainable Development Goals, including for food security and green and digital transition;
9. Commends innovative instruments, including blended financing mechanisms and incentives, the use of guarantees to cover part of the risks that the private sector is not ready to take and green finance initiatives (for example, green bonds);
10. Reaffirms that public policies and the mobilization and the effective use of domestic resources, underscored by the principle of national ownership, are essential to the common pursuit of sustainable development;
11. Urges developed countries to scale up and fulfil their respective official development assistance commitments, including the commitment by many developed countries to achieve the targets of 0.7 per cent of gross national income for official development assistance to developing countries and 0.15 to 0.20 per cent, to the least developed countries;
12. Acknowledges the importance for credit rating agencies to ensure that their ratings are objective, independent and based on accurate information and sound analytical methods, including by considering development, social and environmental indicators and impacts of external shocks in their ratings, and encourages multilateral development banks and credit rating agencies to continue their dialogue;
13. Stresses the importance of transparent data and debt management systems, and notes the value of technical assistance for developing countries to this end;
14. Invites the UNCTAD secretariat to explore with the Department of Economic and Social Affairs, the United Nations Development Programme and the co-chairs of the intergovernmental Preparatory Committee the possibility of jointly organizing a briefing in Geneva about the Fourth International Conference on Financing for Development process for member States and Geneva-based international organizations;
15. Recalls the request by the General Assembly for the Intergovernmental Group of Experts on Financing for Development to present the outcome of its work as a regular input to the Economic and Social Council forum on financing for development follow-up (General Assembly resolution 72/204, paragraph 27), in accordance with the terms of reference of the Intergovernmental Group of Experts.