Indonesia Outlines Solution for Development Financing Gap at UN ECOSOC Meeting

NEW YORK – The Minister of National Development Planning/Head of Bappenas Suharso Monoarfa visited New York, United States, to attend a series of meetings for the Economic and Social Council’s (ECOSOC) Financing for Development Forum 2024 (FfD Forum) held at the United Nations Headquarters between 22-25 April 2024. 

The forum aims to review the implementation of the commitments of the Addis Ababa Action Agenda, financing for the Sustainable Development Goals (SDGs), and the Paris Agreement, which was agreed upon in 2015 to achieve a more prosperous and sustainable economy. "However, six years before the SDGs deadline, we are not close to fulfilling any commitments. With the global SDGs financing gap reaching USD 4 trillion per year, and climate financing and Official Development Assistance commitments still unmet, closing the financing gap is certainly one of the urgent challenges for all of us," said Minister Suharso at the meeting.

During the General Debate session, Indonesia presented several concrete solutions to address the sustainable development financing gap. These solutions include, firstly, enhancing the implementation of financing mechanisms and instruments at all levels. Secondly, reforming the international financial architecture to achieve global development goals through close collaboration between UN policymakers and International Financial Institutions, particularly concerning increasing lending capacity and concessional financing, as well as improving the representation of developing countries, including progress in international tax reforms, debt crisis management, and improving the credit rating system. Thirdly, going beyond the business-as-usual approach and adopting innovative financing to achieve sustainable development goals more rapidly.

Indonesia also showcased several good practices in innovative financing systems that are key to addressing the financing gap issue, including the issuance of Government Blue Bonds offered to the public for the first time in the world, the first SDG Bonds in Asia, and Green Sukuk. The Global Blended Finance Alliance (GBFA) is an alliance to promote solutions to the issue of limited sustainable development financing through blended finance. "We invite member countries to join the GBFA. Only by fostering collaboration can we overcome common challenges. Indonesia is ready to contribute to the acceleration of the SDGs," concluded Minister Suharso.

This aligns with the message conveyed by Antonio Guterres, the UN Secretary-General, that there is a need to transform words into concrete actions for providing large-scale, affordable long-term financing, including through increased efforts by developed countries, fulfilling Official Development Assistance, enhancing capital and resource use efficiency by Multilateral Development Banks, and improving the representation of developed countries in the global system.