Half a trillion dollars may be the minimum amount of investments developing countries will need if the world intends to meet the United Nations’ lofty sustainable development goals for 2030.
“That’s 15% of total GDP for low-income and developing countries,” David Lipton, first deputy managing director of the International Monetary Fund, said this week at a panel discussion in Washington, D.C. “Those are big numbers for those countries, but that’s not a big number for the world.”
The IMF contends that half the needed funds can be raised domestically, but the rest must come from private investment guided by various national governments. Without improved investment structures in place, many developing nations are not sufficiently reliable for straightforward private investment, Lipton said.
“Those are big numbers for those countries, but that’s not a big number for the world.”
Elliott Harris, chief economist of the U.N., told the panel he saw a number of positive developments from the business community during the recent U.N. General Assembly, including the formation of the Global Investors for Sustainable Development Alliance – companies from 160 countries commanding $16 trillion in combined assets that have pledged to work toward meeting the sustainable development goals.
“That makes us now convinced that this agenda…is increasingly being internalized by the private sector,” Harris said at Thursday’s panel discussion titled “Sustainable Development Goals: Making It Happen.”
Which is good, he said, because “that internalization is not matched in the public sector.”
The panelists agreed that governments need to reduce investment risk within their borders to attract new SDG spending. Jason Channell, global head of sustainable finance at Citigroup, said that an estimated $1 trillion in investment opportunities are consumed by corruption problems alone in developing nations worldwide.
“If you do this right, this is not a cost – it’s an opportunity,” Chanell said. “And the economic growth comes with it, as well as the social developments.”
In 2015, all member states of the U.N. adopted the 2030 Agenda for Sustainable Development, which set goals of ending world poverty, hunger, gender inequality and environmental degradation.