The missing link: Improving the transparency of global statistics for sustainable development in a post-COVID era (Financing for Development Forum 2021 side event)
12 April 2021
Excellencies,
Ladies and gentlemen,
Statistics are fundamental for capturing the world we live in and the world we want to create.
This has been very evident over the last year when we have struggled to capture the scale of the COVID-19 crisis, and were in dire need of data to identify suitable response measures and recovery policies.
The 2030 agenda and the 17 Sustainable Development Goals clearly recognize the importance of data, and depend on suitable indicators to monitor progress.
One area that has always been critical is measuring the support available for achieving the SDGs. Development finance and resource mobilization have been fundamental aspects in these discussions as they are key for fulfilling our aspirations embodied in the Goals.
The world today is, however, different from the time when official development assistance (ODA) was the main source of development finance. We are also all aware about the challenges related to ODA. Country efforts are well below the promised 0.7% of GNI; in fact, the contributions average closer to 0.35%. And there are discussions around what should be included in ODA, such as spending on migration policies.
Today, development finance includes different types of flows, diverse actors and different instruments, such as concessional and non-concessional loans. Focusing on ODA or North-South flows thus gives an incomplete picture of how sustainable development is resourced. It distorts the contribution of the developed world to development, and leads to an underestimation of the contribution of the South itself.
To give you an example: In many developing countries, remittances (including those coming from the North but also the South) are much higher than ODA. In Least Developed Countries prior to the COVID-19 crisis, the volume of ODA was similar to remittances (on aggregate).
Given the importance of remittances for financing sustainable development, it is welcome that these flows have now been brought-up to the attention of G20 within the Global Partnership for Financial Inclusion.
Foreign direct investment (FDI) inflows are another essential source of finance for many countries. In this context, it is valid to mention the challenge related to measuring leakage through illicit financial flows. Illicit financial flows create enormous outflows and financing gaps in many developing countries. To better capture these flows and scale, UNCTAD and UNODC (with assistance from OECD, IMF, EU and other partners) have recently published the UN Conceptual framework for the statistical measurement of illicit financial flows, and will shortly publish the accompanying methodological guidelines on how to implement this framework.
This all sums up to one point: Capturing the multiple dimensions of development finance is a challenging task. It is, therefore, useful to have measures that reflect more broadly the support provided for sustainable development.
The new statistical framework of Total Official Support for Sustainable Development (TOSSD) developed by the OECD is insightful. The rigour and consistency of the TOSSD statistical framework are strong. It is also very valuable that the database includes OECD, non-OECD countries and international organizations. This means, for instance, that our - UNCTAD’s capacity building efforts are reflected in TOSSD.
There are some challenges for which we need to find solutions. For instance, how to treat international public goods. Should efforts to clean oceans or eradicate the pandemic be considered development and hence be captured, and if yes how? This discussion touches upon many broad issues, such as climate change or in the immediate context the production and distribution of vaccines.
It is also important that additional measures of support for development are complementary to existing efforts and statistics. Hence, TOSSD or a similar indicator is not a substitute for traditional ODA. They measure different concepts.
To ensure that this work is inclusive and is a tool we all can support, UNCTAD is very pleased to collaborate with the OECD, UNDESA and member states in the Working Group on Measurement of Development Support to reach consensus on how to proceed.
As part of the Sub-Group on Measuring South-South Cooperation, we are also supporting member states to develop an agreed methodology for measuring South-South Cooperation.
I can assure you that we are fully committed to support countries in finding the best ways to measure support for sustainable development. This work is critical for sound decision-making and we stand ready to assist.
Thank you for your attention.
