The Millennium Development Goals come of age in 2015, yet many development challenges remain and others are emerging. The current discussion of the post-2015 goals by the international community will integrate social, environmental and economic concerns into a single set of Sustainable Development Goals.
This report asks what can be done to mobilise the resources needed to finance the achievement of these goals.
Key findings:
- Official development assistance (ODA) has, until recently, been seen as the main source of funding for development.
- To finance a broader set of global Sustainable Development Goals many more resources will be needed.
- Official Development Assistance (ODA) forms only one part of flows targeted to support development. Other financial flows to developing countries include: finance provided by public bodies at close to market terms and/or with a commercial motive; private finance at market terms, such as foreign direct investment; and private grants from philanthropic foundations and non-governmental organisations (NGOs). This reflects the growing diversity in financial options available to developing countries.
- ODA however still remains vital for sustainable development. It provides crucial funds and backing for the fragile and least developed countries, which find it hard to attract or raise other resources; it can also be used to make investment attractive in high-risk situations by spreading and sharing risk, and by creating incentives. ODA also helps countries raise and manage their own domestic resources through capacity building and sharing of good practice as well as supports the creation of a positive development and investment environment through policy reform in areas such as investment and trade.
- Developing countries are increasingly using their potential to fuel their own development and move out of “aid” dependency. They are doing so by: building the capacity of their tax systems; finding creative ways of harnessing the expanding pool of remittances sent home by migrants working overseas; creating the policies and environment required to attract investment by businesses in other countries, including other developing countries and tackling corruption and the loss of money through illicit financial flows
- Sustainable development is no longer a matter of the “North” giving “aid” to the “South”. More and more developing countries are fuelling their own development, and are providing development co-operation themselves. These countries are supporting each other through South-South co-operation.
- Target ODA where it is needed most – the least developed countries and fragile states – and use it to mobilise other resources.
- Re-engineer the ODA concept to ensure it is fit for purpose in the current financial environment.
- Make innovative use of all sources of finance with potential for achieving the global post-2015 Sustainable Development Goals.
- Improve co-operation and mutual reinforcement among all financial providers on efforts targeted at achieving the post-2015 Sustainable Development Goals.
- Support local and global policy reform in the areas of tax, finance, investment and trade, and ensure coherence among domestic and international policies.
- Step up the legislation and co-operation needed to stem illicit international flows.
- Be politically courageous and innovative in financing global goods such as a stable climate or peace and security and start developing the structures and mechanisms needed to deliver them.
Recommendations:
