This week in New York, governmental and non-governmental actors are coming together for the 71st session of the General Assembly of the United Nations and a host of side-events. Among other urgent topics, leaders are discussing our unsustainable consumption of global resources and the resulting impacts on both the human population and the environment.
We already have a vision for the change that needs to occur. Agreed last year by 193 member states, the 2030 Agenda and the corresponding 17 Sustainable Development Goals (SDGs) set out an ambitious plan for tackling climate change, ending poverty, and fighting inequality and injustice. What remains unclear is how practically these goals will be achieved and who is going to pay for them.
This morning at the International Conference for Sustainable Development (ICSD) Jeffrey Sachs noted that we need knowledge-based politics, transparency, as well as inclusive economies and policies to achieve the SDGs. Implementing these will require large-scale innovation and a joint and concerted effort by countries and governments. What about finance?
According to the UN Conference on Trade and Development (UNCTAD) implementing the SDGs is forecast to cost $2.5 trillion a year up to 2030. This is roughly equivalent to the nominal GDP of France. The main concern is not with public or private finance taken individually, but the interplay between the two and how to make the most of their relative strengths.
Generating $2.5 trillion of investment a year will require innovative financial structures that stem from a mix of sources and have impact as their central aim. The SDGs have a business case with real opportunities for investment and governments need to use the political opportunity provided by the SDGs to acts a brokers and leverage budgets to mobilize private financing.
Take for example the United Kingdom’s Green Investment Bank (GIB), which uses public funds to back green projects on commercial terms and leverages private sector capital into the UK’s green economy. Expanding on such models will require forums and platforms at local, national and international levels that enhance transparency and cooperation between governmental and non-governmental stakeholders.
We need to strengthen our understanding of how the SDGs can be met and financed to identify gaps, as well as to track the effectiveness of investments. Here the right balance of regulation will need to be struck to ensure that it has the desired effect in promoting innovation across sectors, ensuring stakeholders work towards the SDGs and allowing bottom-up approaches to develop.
Ultimately, as Achim Steiner noted at the International Conference on Sustainable Development, we need to invest in our common future and we will need to look very carefully at how the global financial system can align with the SDGs. If we want a cleaner and more just world for investments then public and private partnerships are the only way forward.
Julian Payne is a Project Officer at SDSN Youth for Research and Policy. All opinions expressed on the blog are the opinion of the authors and not of SDSN Youth.