UN Joint SDG Fund: First Call on SDG Financing

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The UN Joint SDG Fund (the Fund) supports countries as they accelerate their progress toward the Sustainable Development Goals (SDGs). The Fund operates through a series of calls for the United Nations (UN) system that lead to the implementation of transformative Joint Programmes (JPs), under the leadership of Resident Coordinators (RCs). In doing so, the Fund is committed to forge paths and partnerships that unlock public and private capital for the SDGs at scale. All allocations made by the Fund will be in the form of grants to UN agencies.

This call operationalizes the following “Terms of Reference” of the Fund:

● Reinforce the SDG financing architecture (Component 1): The Fund will support UN Country Teams in the development of financing strategies and enabling frameworks for SDG investment. This work will include the strengthening of the capacities of the national and sub-national SDG financing architecture, piloting of integrated national financing frameworks, establishment of partnerships through convening networks and consortia comprised of actors from the public and private sector and the production of SDG-aligned financing strategies.

● Catalyze strategic investments (Component 2): The Fund will support UN Country Teams in investing in key initiatives that leverage public and private financing in order to advance the SDGs. These initiatives will provide a demonstration of concept and will be scalable both in country and elsewhere.


World leaders have made ambitious commitments to achieve the SDGs. Yet, securing enough resources remains a major challenge, with developing countries facing a gap estimated between US$2.5–3 trillion per year. Financing is theoretically available, given the size, scale and level of sophistication of the global financial system—with gross world product and global gross financial assets estimated at over US$85 trillion and US$ 200 trillion respectively. While the world has never been as rich as it is today, financial flows and wealth, mostly private, do not (or cannot) reach the geographies and people that need them the most.

There is no lack of opportunities to fill the gap and reorient public and private investment towards the SDGs.
SDGs are being increasingly integrated into public budgets and development cooperation. Despite growing concerns on public debts, the median tax revenue is growing in the developing world: 80 countries have reported an increase in their tax-to-GDP ratios in 2017. The digitalization of finance—or fintech—has opened new venues at a speed unimageable at the beginning of the new millennium.

Not only Governments, but also the financial markets and investors have positively reacted, by starting to demand and claim a stronger integration of the SDGs in public and private investment decisions. Commitments were supported by increasing evidence that investing in the SDGs makes economic sense, with an estimated US$12 trillion of market opportunities. Responsible investment strategies, from exclusion lists to impact investing, have grown to US$30.7 trillion in 2018. New markets and asset classes have emerged: the green bond market increased from virtually zero in 2010 to over US$200 billion in 2019. Despite opportunities, bottlenecks and intensified risks—from vulnerability to climate change and economic recessions to health epidemics—persist. Most private investments are not channeled towards sustainable development at the scale and speed required. SDG investment opportunities in many countries, such as Least Developed Countries (LDCs), Small Island Developing States (SIDS) and fragile countries are underinvested.

Private investments in SDG-related infrastructure in developing countries were lower in 2018 than in 2012. The financing for the 2030 agenda is constrained by a range of challenges, including:

• Limited fiscal space and institutional capacity to formulate a pipeline of bankable SDG investment projects, and weak public finance management systems, notably in countries most at risk of being left behind.

• Weak tax collection systems and underperforming public finance management that result in reduced revenue generation and lower performance and budget execution, thus limiting the available space for increasing SDG-relating spending.

• Misaligned incentives and regulations, limited awareness, and difficulties in identifying, measuring and reporting on sustainable investments, which impede private investment in the SDGs at scale.

• Public planning and SDG-aligned strategies remain de-linked from financing and budgeting, leading to less effective spending and poor service delivery. The same strategies are also not designed to attract different sources of financing, including from the private and financial sectors.

• There is often a mismatch between what private “capital” wants and needs and the environment and bankability of businesses and projects that impact the SDGs.

• The lack of common definitions, impact measurement standards and rigorous frameworks for reporting are challenging the way impact is measured.