With developing countries facing dire outlook, United Nations Secretary-General and world leaders aim to stimulate economies to achieve SDGs

Initial action on scaling up MDB financing and rechannelling SDRs provides momentum to deliver SDG Stimulus
 
NEW YORK, 5 JUNE 2024 – With many developing countries reeling from repeated economic shocks and debt burdens that far outstrip their ability to pay, United Nations Secretary-General António Guterres will meet today with Heads of State and Government to advance efforts to put countries back on a sustainable development path.

At their first meeting, under the leadership of the 10-member “SDG Stimulus Leaders Group,” countries will discuss recommendations and actions needed to address the dire financial conditions holding back developing economies.

“We need a surge in action now for the Sustainable Development Goals (SDGs).  Developing countries — and billions of people — are facing the worst economic outlook in more than a generation,” the Secretary-General said. “Financing is the fuel of development and we must ensure that countries are not forced to run on empty.”

At today’s meeting, leaders will discuss the Secretary-General’s call for an SDG Stimulus, a wide-ranging proposal for near-term actions to provide developing countries with the financial resources to alleviate their immediate constraints and put countries back on an accelerated development path.

The SDG Stimulus identifies three areas of action: tackling the high cost of debt and rising risks of debt distress; massively scaling up affordable long-term financing, especially through multilateral development banks (MDBs), by at least $500 billion per year; and expanding contingency financing to countries facing liquidity constraints.

Co-Chair of the Leaders Group, Prime Minister Justin Trudeau of Canada said: “The Sustainable Development Goals are crucial to growing our communities, building a better future, and keeping the air clean. I am pleased to co-chair this Group with the UN Secretary-General and Prime Minister Holness of Jamaica. Let’s keep working together to make life fairer, more sustainable, and more prosperous for everyone.”

Co-Chair of the Leaders Group, Prime Minister Andrew Holness of Jamaica said: “The SDGs will be unattainable unless developing states gain access to the financial resources required to implement the 2030 Agenda. The international financial system must urgently respond through innovative mechanisms to create the fiscal space needed for developing states to build a sustainable and resilient future for present and future generations.”

Prime Minister Mia Amor Mottley of Barbados, Co-Chair of the SDG Advocates said: “I warmly welcome this initiative from the UN Secretary-General to turbocharge the implementation of the Sustainable Development Goals. The SDG Stimulus, the Bridgetown Initiative, the Paris Pact for People and Planet and other international initiatives are converging to scale up the scope of financing and speed up its disbursement. This is the only way that the entire global community, especially the most vulnerable among us, can meet the climate crisis and overcome the obstacles to the true sustainable development that all of our peoples deserve.”

The Secretary-General first proposed elements of the SDG stimulus 18 months ago and it has since gained traction at many global gatherings. Most recently, it was welcomed by world leaders at the SDG Summit and in the G20 New Delhi Leaders’ Declaration.

Since then, G20 countries have rechannelled $100 billion dollars of Special Drawing Rights (SDRs), enabling the IMF to assist developing countries with liquidity financing. MDBs have embarked on a series of reforms that will enable them to collectively expand lending by $300-400 billion dollars over the next decade.       

Yet despite these initial steps, conditions in many developing countries are worsening. Reversing their fortunes will require bolder and faster action.  

Over the next year, the Leaders Group will proactively seek to advance the SDG Stimulus. It will act as an alliance, bringing alignment and prioritization to the agenda. In addition, it will connect decision-making bodies and convening processes critical to the SDG Stimulus agenda.
More information on the SDG Stimulus Leaders Group can be found here.