How to Afford the SDGs
The track record of two large multilateral institutions shows that investments aimed at achieving the Sustainable Development Goals can bring major benefits to society as well as adequate risk-adjusted returns to investors. And the success of this model suggests how to increase private SDG-linked investment.
PARIS – In September 2015, world leaders committed to achieving 17 Sustainable Development Goals by 2030. Back then, the United Nations Conference on Trade and Development (UNCTAD) estimated that attaining the SDGs would require about $2.5 trillion per year of additional investment in developing countries alone. A recent International Monetary Fund study produced a similar estimate of the extra annual spending needed between now and 2030: some $500 billion in low-income countries and $2.1 trillion in emerging-market economies.
Is this a lot or a little? Can the world really afford to deliver on its commitment to meet the SDGs?
If developing economies have to find all this money themselves, these amounts are very large – especially for low-income countries, where the investment gaps are equivalent to about 15% of GDP on average. Even for emerging-market economies, where the gaps represent about 4% of GDP, this is a substantial sum.