Financing for sustainable development at a tipping point

Although a major collapse of financing for sustainable development was avoided after the COVID-19 pandemic in 2020, developing countries’ government revenue did drop significantly and the SDG financing gap got wider. In the wake of Russia’s war against Ukraine, many of them face reduced access to financing, increased volatility of private investment, and limited fiscal space to invest in a just and sustainable recovery. Improved mobilisation of domestic resources, sustained efforts by official providers, and reducing illicit financial flows and public sector inefficiencies will be critical to avoid a prolonged divergence in countries’ capacity to finance their development.