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Financing the 2030 Agenda: What is it and why is it important?

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António Guterres launches his strategy to finance the 2030 Agenda to put the world on a more sustainable path, this 24 September, ahead of the General Assembly’s annual general debate.

How high on the Secretary-General’s to-do list is the 2030 Agenda for Sustainable Development?

Well, the timing of the meeting to discuss financing the Agenda might be a clue: it takes place on Monday afternoon, just before the General Debate of the General Assembly on Tuesday morning, when the eyes of the world will be on UN Headquarters in New York.

A plan to transform the world

The 2030 Agenda for Sustainable Development, commonly referred to as the 2030 Agenda, is being billed as a plan to “Transform Our World.”

In 2015, UN Member States adopted the Agenda and its 17 Sustainable Development Goals, or SDGs, which break down into three broad areas: people, planet and prosperity.

The adoption of the Agenda was significant, as it was the first time that world leaders pledged common action in support of such a universal and ambitious policy agenda. As the name suggests, the organizing principle of the Agenda and the SDGs, is sustainable development, and this is also the key message to the world community.

The UN defines sustainable development as “development that meets the needs of the present, without compromising the ability of future generations to meet their own needs.” This means taking into account, for example, the effects that unbalanced economic growth can have on the environment and people’s wellbeing.

The SDGs provide a framework for sustainable development that improves the lives of everyone, everywhere. For example, ensuring that economies grow and provide decent work; that everyone has access to nutritious food, no matter where they live; and access to quality education for all.

From 2015 until 2030, Member States, civil society and other partners are mobilizing efforts to change the way the world does business: ending all forms of poverty, fighting inequalities and tackling climate change, while ensuring that no one is left behind.

Since 2015, the UN has been hosting several meetings every year, designed to monitor the progress of Member States and partners, including the private sector, in changing business practices to ensure that the SDGs can be met.

The foundations for the financing of the SDGs were laid in July of that year, at the Third International Conference on Financing for Development, which took place in the Ethiopian Capital Addis Ababa, in a document called the Addis Ababa Action Agenda. It provided a new global framework for financing sustainable development by aligning finance with economic, social and environmental priorities; and set out a list of over 100 concrete measures, touching on finance, technology, innovation, trade, debt and data, in order to reach the SDGs.

Progress and setbacks

Since then, there have been positive signs. Just a week ago, at the Global Climate Action Summit, it was estimated that new UN-backed commitments to take action against the damaging effects of climate change could result in $26 trillion in economic benefits worldwide, and help create 65 million new “low-carbon jobs” by 2030.

Many welcome initiatives by governments and companies were noted. For examples, the Investors Agenda, one of the focus areas of the Global Climate Action Summit, brought together nearly 400 investors, managing $32 trillion of assets, who pledged to scale up the flow of capital into climate action, and a more sustainable, low-carbon economy.

However, whilst this new way of running the world presents a huge investment opportunity, public or private resources, and investments remain stubbornly far below what is needed to meet the 2030 targets.

Too much investment remains short-term and volatile, and the systemic change needed  transform economies and societies is not yet happening. Governments need to make it easier for business to finance and invest in sustainable development projects, the private sector needs to mobilize for long-term investment, and new solutions for financing the SDGs must be created.

The High-Level Meeting on Financing the 2030 Agenda

Which brings us back to Monday’s meeting. It can be expected that the timing, and the senior status of politicians taking part, will ensure that considerable attention will be directed to the proceedings, and the outcome.

The Secretary-General will open the meeting, followed by Christine Lagarde, the Managing Director of the International Monetary Fund (IMF). Heads of State and Government will also participate, as well as senior representatives of leading private sector investors, financial technology innovators, and foundations.

Mr. Guterres has indicated that this meeting will be used to build momentum and political support at all levels; step up engagement with the private sector; and make the most of innovative solutions to finance the SDGs.

It will also be the forum for the launch of his Strategy for Financing the 2030 Agenda for Sustainable Development, which has three objectives:

  1. Aligning global financial and economic policies with the 2030 Agenda
  2. Enhancing sustainable financial strategies at the regional and country levels
  3. Exploiting the potential of financial innovations, new technologies and digitalization to provide equitable access to finance.

After the meeting, the process continues, with several follow-ups scheduled for this year, and into 2019. The road is long, complicated and filled with potential potholes, but the commitment from the UN is clear: transform the world for the better by 2030.

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ADB Project to Improve Fiscal Management, Develop Capital Markets in Armenia

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The Asian Development Bank (ADB) has approved a $40 million-equivalent policy-based loan attached to reforms that help strengthen fiscal sustainability and develop the financial and capital markets in Armenia. These are crucial enablers of private sector development.

Armenia’s economic growth over the last few years has been hampered by low levels of investment, both foreign and domestic, given the high costs of local currency finance and related constraints in the financial system. Efficiency-promoting upgrades in public investment and fiscal management are also needed to ensure sustained improvements in fiscal outlook and sovereign risk pricing.

“Financial markets remain nascent in Armenia, which limits the development of the country’s private sector and the banking industry,” said ADB Senior Financial Sector Economist for Central and West Asia Mr. João Farinha Fernandes. “This also constrains public finance and fiscal management, while exposing the economy to financial stability risks. ADB’s assistance is intended to help ensure that Armenia develops a conducive fiscal and financial intermediation environment where private sector players, both big and small, can contribute to growth and development.”

ADB approved a $50 million policy-based loan in November 2018 as part of an ongoing programmatic engagement on financial reforms to strengthen public debt and fiscal risk management, and to develop financial markets in Armenia.

The Second Public Efficiency and Financial Markets Program continues these reforms by strengthening the effectiveness of the government’s fiscal risk management function; promoting the development of fiscally responsible public–private partnerships; and enhancing market transparency and predictability in public debt management. The program will also improve the infrastructure of the government securities market and money market infrastructure, enhancing the sustainability and resilience of Armenia’s finance sector.

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Bangladesh Can Boost its Exports with Better Logistics

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To meet the needs of its growing economy and to boost export growth, Bangladesh needs to improve its transport and logistics systems, says a new World Bank report launched today. 

The report Moving Forward: Connectivity and Logistics to Sustain Bangladesh’s Success, finds that by making logistics more efficient, Bangladesh can significantly boost export growth, maintain its position as a leading ready-made-garments and textile producer, and create more jobs. The report notes that congestion on roads and in seaports, high logistics costs, inadequate infrastructure, distorted logistics service markets, and fragmented governance hamper manufacturing and freight, further eroding Bangladesh’s competitive edge and putting its robust growth path at risk. 

“Bangladesh’s congested transportation and often unsophisticated logistics systems impose high costs to the economy,” said Mercy Tembon, World Bank Country Director for Bangladesh and Bhutan. “By making its logistics more efficient, Bangladesh can significantly optimize its connectivity, business environment, and competitiveness, putting the country on the right path to become a dynamic upper-middle-income country.”

Efficient logistics, the report argues, has become one of the main drivers for global trade competitiveness and export growth and diversification. For Bangladesh, improving its logistics performance provides an opportunity to increase its world market share in garments and textiles, which account for 84 percent of its total exports, expand into new markets, and diversify its manufacturing and agriculture into high-value products. 

The report notes that improving Bangladesh’s logistics requires a system-wide approach based on greater coordination among all public institutions involved in logistics and with the private sector, increasing the effective capacity of core infrastructure, and removing distortions in logistics service markets to reduce costs and improve quality. At a regional level, harmonizing its logistics systems and aligning its customs with that of its neighbors could turn Bangladesh into an important node for regional freight flows and further boost its trade. 

“There’s no doubt that reforms and investments for better transport and logistics will yield Bangladesh substantial economic benefits and strengthen its competitive advantage,” said Matías Herrera Dappe, Senior Economist at the World Bank and author of the report. “But the solution to logistics is not just to invest more but to invest better, by focusing on the service gap, and creating the incentives for high quality and competitive logistics services.”

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New development models to drive growth and employment for youth in Africa

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The United Nations Environment Programme (UNEP) today launched the Global Environment Outlook-6 (GEO-6) for Youth in Africa report on the margins of the 17th session of the African Ministerial Conference on the Environment (AMCEN).

The report analyses the economic opportunities that Africa’s natural resources can provide for job creation and sustainable development. It also provides a package of solutions to tackle Africa’s youth unemployment through the Green Economy.

“This Publication is anchored substantively in the UNEP’s sixth Global Environment Outlook (GEO-6) Regional Assessment for Africa,” said Juliette Biao Koudenoukpo, Director of UNEP’s Regional Office for Africa. “This Assessment has a very clear message; Africa has an opportunity to use its large young population to drive its growth.”

Africa’s youth remains the most hit by unemployment. One-third of Africa’s 420 million youth aged 15 to 35 are unemployed. Of these, 35 per cent are vulnerably employed and 19 per cent are inactive. These numbers will increase dramatically unless urgent actions are not taken.

The report recommends that Africa’s natural capital should be managed sustainably to enhance the livelihoods of African young population, create more sustainable and decent jobs as well as increase social and economic cohesion.

“The Green Economy calls for a paradigm shift in the way that we produce and consume. If young people are the centre of such a shift, they will secure a sustainable future replete with sustainable livelihoods,” said Professor Lee White, Minister for Environment, Forest and Oceans of Gabon and outgoing President of AMCEN. “The Global Environment Outlook-6 for Youth, Africa: A Wealth of Green Opportunities digs deep into that future and shows young people how they can secure their livelihoods through green jobs.”

Natural resources remain a key source of employment in Africa. Eight out of ten people’s employment on the continent are supported by natural resources. Nearly six million Africans are employed in the fisheries and aquaculture sector, ten million people work in the wildlife sector and an average of 54 per cent in the agricultural sector.

The report includes case studies and success stories on African youth who have invested in natural resources to develop entrepreneurship, improve their knowledge and skills as well as create jobs and sustain their livelihoods.

The report calls on governments to encourage youth to invest in green economy through creating platforms for innovation in sustainable development. While confirming the potential of youth in leading green growth in Africa, the report strongly establishes the correlation between green economy and decent jobs.

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