 Honourable Everly Paul Chet Green, Minister for Foreign Affairs, Trade and Immigration of Antigua and Barbuda, Excellency Ambassador of Atumana Vapa O Lutero, Permanent Representative of Samoa to the United Nations, Distinguished Representatives of Governments and International Organisations, Year Panelists, UN Colleagues, a warm welcome to our 2022 High-Level Political Forum side event titled Financing for Sustainable Development in Vulnerable Countries. This is a topic of high interest as we collectively face major challenges brought about by the triple crisis of food, energy and debt and the never-ending pandemic. Having listened to the High-Level Political Forum over the last few days, the financing, the development financing remains one of the major challenges that all countries speak about in presenting their SDG progress or lack of progress. The event today is co-hosted by the Government of Antigua and Barbuda, the Government of Samoa and the Seeds Resident Coordinators Network jointly with the Sustainable Development Solutions Network and maybe just as a way of introduction over the last two years the Seeds Resident Coordinators Network together with the Sustainable Development Solutions Network have worked on the development of a universal multi-dimensional vulnerability index at the request of the small island developing states and also into a General Assembly resolution, Resolution 75215. Our index is today on one of the inputs to the High-Level Expert Panel that was established by the President of the General Assembly. Antigua and Barbuda and Norway are co-chairing the panel and I'm very pleased that the ambassador of Samoa Permanent Representative to the United Nations who is with us today is also a member of the panel. As the index is about to be finalized with the report expected on 29th of August and deliberations to follow, we think that it is time to discuss the entire journey moving from the index to the actual solutions that we need and in that regard we would like to discuss today how from the development of the MVI we are going to be able to measure the financing gap for the SDGs and then discuss solutions so most of the presenters today are going to address those topics. It is with great honor that I give the floor for the opening of our meeting to Honorable Everly Paul Chet Green, Minister of Foreign Affairs, Trade and Immigration and a member of Palo Alto of Antigua and Barbuda and let me once again mention that Antigua and Barbuda is the chair of the Alliance of Small Island Developing States and a great partner into the development of the index and into the broader discussion of development access to development financing for vulnerable countries and ultimately for all countries that struggle at this time to recover from the multiple crisis. Honorable Minister, the floor is yours. Excellencies, partner co-hosts, ladies and gentlemen, climate change, incidents of pandemics, the socioeconomic crisis and the war in Ukraine are all direct threats to the most vulnerable countries achieving the sustainable development goals. They accepted wisdom that the development process is linear and that one size fits all as a response measure is certainly outdated. Development countries remain most vulnerable to global shocks and seeds are particularly more vulnerable as we take every vulnerability box within the context of the SDGs. The impact of the pandemic on developing countries and the ability to achieve the SDGs in the remaining eight years should be a most worrisome matter or concern to us all. While seeds are meant to be universal, the process of implementation is not. Rich and more advanced economies are equipped with the financial resources to fully implement the SDGs within the national context. On the other hand, the most vulnerable countries are left wanting. Developed countries and private sector must step up and provide necessary resources needed so that all countries and I repeat, all countries big and small can raise to the 2030 knowing that the finances are available to fully meet the demands of the SDGs. While financial support is required, capacity building, transfer of technology, physical infrastructure and improvement of human capabilities are also necessary. The COVID-19 pandemic opened the eyes of the world as to just how vulnerable we all are. How easily our human financial and physical security can be wiped away at a moment's notice. The sense of hopelessness and of helplessness that engendered all countries during the global lockdown is not new to us since. We experienced this during every hurricane and with every new devastation. The pandemic laid bare before and beyond the scale of SIDS and LDCs, just how interconnected we are as a global community at the same time the inadequacy of the global response. A response to allow the richer countries to pump trillions of dollars into the economies with a stroke of a pen and their reluctance to fully support the 2030 agenda with that same stroke of a pen. Striking the right balance, therefore, between national and global interests sometimes can be so difficult, pains taking the difficult. What however should not be difficult is providing means of implementation for the 2030 agenda and in particular the SDGs. My dear friends, in closing, I want to stress that the COVID-19 pandemic coupled with the war in Ukraine are time bound events. The climate crisis is a true enemy and will continue to impact the achievement of the SDGs. We will need all the tools in our arsenal, including a recommitment to the 2030 agenda, because my country and others like it who are barely hanging on to the goals as outlined in 2030 agenda demand and deserve this attention. We need the support of everyone, every country, the UN system, the private sector and civil society as we race towards 2030 with a mere eight years remaining. Again, I thank you for the opportunity to address this very important meeting and wish you very successful deliberation as we continue to make interventions on this very important issue facing humanity. If it pleases you, have a great day. I know about Minister Green. Thank you so very much for all those reasons that you have mentioned, seeds, resident coordinators across the world, including my distinguished colleague, Didier Tribuque, resident coordinator in the Caribbean, have worked over the last two years to define the index. We do know we are fully aware of the challenges that seeds are facing and we do know that their prospects for sustainable development are much more limited within the financing envelope that they have access to. I'm pleased that international financial organizations are with us today. They will present their understanding of the index and how the index will be used for access to development financing. And I wish to thank again the government of Antigua and Barbuda for the passion, the leadership that has been given to us throughout the process of developing the index. And we look forward to the upcoming discussion in which we will talk about the next 10-year seeds agenda possibly moving to the Caribbean from Samoa. Thank you so much. And for the panel discussions, I'm going to give the floor to the moderators. Our first moderator is Dr. Isabella Massa, the Sustainable Development Solutions Network, the team led by Professor Jeffrey Sacks, who is going to join us through the meeting at some point. Isabella Massa has been the technical lead of most of the work that we've produced together. And we look forward to the discussions panel one on measuring vulnerability, panel two on measuring the SDG financing app, panel two on financing solutions. Dr. Massa, the floor is yours. Thank you, Simona, for the introduction. So as you mentioned, I'm a senior economist at the Paris Office of Sustainable Development Solutions Network, working together with Professor Sacks and our vice president and the head of the Paris Office, Guillaume La Fortuna, on a small island developing states related issues, as well as on the SDG financing. So I'm very honored and it's a great pleasure for me to be moderator for panel one. So just to say today, we have unfortunately a tight schedule, a quite packed agenda. So I encourage the panelists to keep their interventions within the five to seven minutes allowed. And I also invite the participants to ask questions in the question and answer box at the bottom of the Zoom panel. If the time permits, we will have a question and answer session following two panel discussions. Otherwise, we will do our best to respond to some of the questions after the event. And of course, please feel free to reach out to us at info at SDGindex.org. So now let's jump into our first panel conversation. So as it has already been mentioned, there is a lot of discussion around the development of the Multidimensional Vulnerability Index, a revision of the criteria to access concessional finances needed to take into account countries' vulnerability. And that's why the UN will soon finalize the Multidimensional Vulnerability Index. But in addition to this, it is also important for countries to quantify the scale of the additional financing that they need to build the resilience, including to natural hazards and also to advance on all the 17 SDGs. So let me now start by introducing our first distinguished speakers. So all the speakers of this panel will provide their views and insights on how best the SDG financing gap could be measured. So I'm honored to welcome our first panelist, Dr. Simona Marinescu, who is serving as UN resident coordinator in Samoa, Cook Islands, Newway, and Tokelau. Simona is also a colleague of mine because as she mentioned over the last three years, we have been collaborating for producing what is today the Tile SDSN Multidimensional Vulnerability Index. And we are also currently working on SDG financing gap in particular in small island developing states. So Simona, why is it important to measure the SDG financing gap? And which is the methodology that the UN resident coordinators in small island developing states are proposing. Over to you, Simona. Thank you so much, Dr. Massa. I'm just waiting for my few slides on the screen. But let me just make a very brief introduction to mention that the MVI, the Multidimensional Vulnerability Index that we produced, is meant to be a metric complementing the GNI per capita as the distinguished minister of foreign affairs trade and immigration of Antigua and Barbuda mentioned. Development is not linear. It has never been. The progress in the GNI per capita is not necessarily an indication of the needs that countries continue to have. And as we could see in small island developing states, the GNI per capita is a misleading indicator as countries continue to face major vulnerabilities. I will go very quickly through a few slides, and I'm kindly asking you to move to the next piece. As mentioned, the index that we've produced, and I'm referring to the seeds resident coordinator offices, seeds, of course, stands for small island developing states together with the Sustainable Development Solutions Network and with the guidance of Professor Sacks. The MVI, the index, has been constructed to draw on inherent vulnerabilities of seeds and primarily on exogenous factors affecting economic and social progress. And as the General Assembly resolution issued recently, Resolution 76203, requests the index itself must be exogenous. We need to look into factors that affect development progress that are not solvable with the means that governments have with policies and laws and budgets. And in that regard, we constructed index on three pillars, economic vulnerabilities, environmental vulnerabilities, and structural development limitations. There have been questions as to why not social vulnerabilities. As mentioned, social vulnerabilities are primarily an output, a result of those inherent vulnerabilities. Seeds economies are very small, opportunities for employment remain limited. And again, very, very volatile as those are countries that have export concentration on tourism services that again are always affected by crisis. The pandemic though offered us an opportunity to identify additional vulnerabilities that seeds are facing. So this is a much more refined analysis than the initial thinking. And with the index, the construction of it, the selection of variables took into consideration the need for comparability as the General Assembly requested the index to be universal. So we have built variables into the index to allow for comparability across 195 countries and territories. And in all of those analysis, seeds are predominantly present in the first 30 countries on top of vulnerabilities. With the MVI, as again, this is a metric to complement the GNI per capita, we will be able to distinguish among countries that are at the same level of GNI per capita or the same income group and better understand the needs. And the needs would be primarily financing, development financing needs that we aim to assess. And in our analysis, we have been able to identify strong linkages between the level of the MVI and progress against the SDGs. And I'm referring to primarily human development SDGs, poverty, the well-being, including health and life expectancy, food security, and the series of other SDG outcomes. So the very clear inverse proportionality with higher vulnerability, lower SDG progress has been identified resulted from our multiple analysis. The very aim of the MVI is then to be able to tailor financing instruments for countries based on their drivers of vulnerability. And in the case of seeds, of course, we look into insurance and guarantee mechanism. We know some of the seeds have moved forward into creating legal mechanisms to seek compensations. We also want to ensure that the ODA is not declining as countries go up the ladder in terms of income per capita and primarily access to concession of financing. But we hope the index will be used for that restructuring that really, as well as for some of the innovative instruments, the green, the blue, the SDG bonds, and primarily looking into the parametric insurance that is necessary as countries aim to have access to more of that, again, through specific tailored bonds. Just to mention that while, of course, countries will move in such financial we would like to clarify seeds continue to be in need of ODA, the level of ODA per capita in the GNI per capita is very high across seeds. So while we're looking to innovative financing development, traditional development financing needs to continue next slide and that will be very, very quick. In our analysis, and again, I mentioned the methodology, but just to clarify that one of the first findings is that what matters to SDG progress using the SDG index that SDSN is producing is primarily the government expenditure per capita. So I'm referring to public outlays, expenditure that the governments are making in key areas, human development related areas as well as into fundamentally needed infrastructure. And that in that regard, looking into from what level of the public expenditure per capita progress against the SDGs using the SDG index of SDSN is being made. We have identified that from 10,000 US dollars per capita, again, PPP adjusted, countries are moving much faster towards the SDGs. So we would like to ensure that governments will have access to such resources to be able to continue public financing. And you can see the chart that we've presented here to showcase how increasing expenditure per capita is actually supporting faster SDG progress, SDG score using the SDG index of SDSN. Next slide and I'll finish quickly, as I can see Professor Sacks has joined. We are fully aware, again, I'm talking about the broad UN team covering small island states that the chronic under financing is undermining SDG progress. The minister spoke very eloquently about that. And we also see a very, very high correlation between the spending public spending per capita in countries that are at the lowest level of public outlays and the SDG score. In average, as you can see that charts seed are spending 5,000 US dollars per capita, whereas the most optimal score above which we have 40 countries, some 40 countries would be 18,000 US dollars per capita. Obviously, governments of seeds would not have such resources unless as a result of the MBI and the SDG gap of measurement, we will advance towards changing rules for access to development financing. Next slide. This is my last, so I'll be very quick. There are different approaches in measuring the SDG financing gap just to make it very clear the vulnerability resilience country profiles that are being requested by the same general assembly resolution for us would employ the SDG framework as the resilience framework of every country. We don't need to invent any other definition. The SDG framework was developed to be a measurement of progress made towards resilience. In that regard, there are multiple ways in which the SDG financing gap is being measured, the top down approaches, the input output approaches, the forecasting based on elasticity panelists will speak to that, maybe just to mention that the ultimate objective is not to just have the measurement but to design the instruments that countries need, seeds and non-seeds. In our approaches, we have used two ways for the time being the regression based approach in which we practically assess the gap in government expenditure without identifying items of expenditure. We talk about the government expenditure in general and as a share of GDP against compared with the SDG index score that countries are making. The second methodology that we are using is more of a bottom up process that identifies public expenditure per SDGs. We are using the six transformation framework of SDSN and I'm sure Professor Sartz will speak to that and a series of other methodologies that have been developed including the SDG index by SDSN. We will also use the COFAR data, the expenditure by functions of government of the IMF to cross validate the data that is being collected at the country level. And in two weeks from now, there will be a technical note that we will issue together with SDSN on the approach to measuring the SDG financing gap and we look forward to the adoption of the report of the NVI and our work will continue. The NVI is just the beginning and with that, I'm very pleased to give the floor to our distinguished guests today. Our partner, our mentor into the development of the NVI, a university professor at Columbia University and director of the Center for Sustainable Development as well as president of SDSN. I can't continue introducing Professor Sartz without embarrassment as Professor Sartz does not need any introduction. So thank you so much Jeff for joining the floor is yours. Simone, thank you and thanks to all the participants and apologies for a very shaky broadband connection today. But let's hope that it lasts long enough for me to make a few remarks to add to Simone's wonderful presentation just now. The SDGs at the core are an investment agenda and investment needs finance and this is today the big puzzle of how the sustainable development goals can be achieved, especially in low income, lower middle income and highly vulnerable economies where the means of financing the needs are desperately short of the magnitude of the investment needs. As Simone mentioned briefly, the SDSN works with a six transformation framework that organizes the investment needs into six broad categories. They are very familiar to you. They are education and skill development and R&D for all that's transformation number one basically around education and skills. SDG transformation number two is health for all. Transformation number three is green economy, especially the energy transformation electrification obviously for all but based on low carbon energy and all of the rest of the investments that are needed to cut industrial pollution and to reach the net zero greenhouse emissions by mid-century. Transformation number four is sustainable agriculture and sustainable land use and coping with the adaptation challenges coming from the ongoing climate change. Transformation number five is the whole range of urban infrastructure in a world in which developing countries are urbanizing very rapidly and another two billion or so people will join the urban society by mid-century and transformation number six is investing in the digital society. Well the main point is if you want schools and clinics and energy and sustainable agriculture and cities that function and digital access for society you have to make investments and the investments can't wait for development because these investments are key inputs for development. You don't say well we'll invest in quality schooling after we develop because there won't be development unless the children are learning properly. You don't wait for economic development before electrification because electricity is an absolutely fundamental input for development. Well this is all quite obvious except that the world doesn't work in a way consistent with being obvious here we have the global commitment to the sustainable development goals but for a very large part of the world the sustainable development goals are simply out of reach because the level of investment needed in order to ensure all children in school everybody with health care electrification for all sustainable land use sustainable cities digital access it's just too expensive for a poor country to afford and it's really sad that the IMF and the World Bank and other institutions sign agreements with countries that lead these countries impoverished or sign agreements with small island developing states facing huge challenges of climate change that they didn't cause and nobody says oh well that is such a major investment challenge we're going to ensure that you have the investment needed to accomplish this for several years SDSN has been trying to use various kinds of analytics and also working with the IMF to understand how big are the investment needs and how can they be met well in terms of how to meet investment needs there really are only a few ways one is that you can invest out of the national budget but in a poor country the budget resources are very small you can try to mobilize private capital but private capital doesn't come if there is an infrastructure and skilled work so there's a kind of vicious circle or you can mobilize international capital ODA official development aid is supposed to be one part of that but rich countries are stingy so the ODA is less than half of even the small amount that has been promised year after year for decades the 0.7 percent of the gross national income of the rich countries my country the United States one of the stingiest countries it doesn't even reach 0.2 of 1 percent of national income in development aid it's about 0.17 of 1 percent right now really pathetic and sad just a demonstration of lack of global solidarity but in general for most of the rich countries just not doing what needs to be done so the other way is to borrow internationally and for a long time development advisors and partners not me but others said oh go borrow on the capital markets big capital markets go borrow from business but if you tap the euro bond market as a lower middle income country without investment grade which almost none of them has you'd end up paying 10 interest on a seven-year loan well try developing in seven years and try to repay at 10 percent the interest rates you end up bankrupt or insolvent or an illiquidity crisis and that's what has happened to so many developing countries that were told by the World Bank or the IMF or others go borrow on international capital markets so here's the deal there's not enough financing the terms from the private markets is completely inadequate the result is one of two approaches one approach says okay we'll live without electricity okay we won't have kids in school it's unbelievable in the 21st century that this remains a fact of life for more than two billion people or okay we'll borrow at any cost and then you end up in a debt crisis so we need a proper way of SDG financing and we need the SDG financing to be honed to the needs of each country because this is a global deal so if the countries are especially vulnerable there are small island states for example very hard hit by climate change you can't apply one-size-fits-all principles say no no you graduated you don't get aid what we need to do systematically analytically is say okay here's the investments needed by this country in the six transformations and this is what they would cost and here's what the domestic budget can cover here's what's coming in through private capital and then there's a gap and the gap needs to be filled by development finance of one kind or another now that leads me to the question how are we going to fill the gap because the gap is actually probably close to a trillion dollars a year if you add up all of the developing country needs that can't otherwise be met a trillion sounds like a pretty big number and a trillion is a big number but remember the world economy is a hundred ten trillion dollars of annual output the US economy by itself is almost 25 trillion dollars so when we talk about a trillion dollars of incremental financing for all the developing countries we're talking about one percent of world output in other words if we cared and we we do care but if rich country politicians cared this would not even be a heavy lift but it is a heavy lift because power, stinginess, greed, ignorance it's pervasive in the world right now and so we need a massive campaign of awareness of understanding and of economic justice to say we need a massive increase of development finance it is urgent it's becoming even more urgent with pandemics climate shocks war sanctions you name it developing countries are reeling from all of these shocks and we need an SDG stimulus now well with Simona with colleagues at the UN with the UN leadership with the Fred Woods institutions I'm involved in a number of processes to mobilize at least hundreds of billions of dollars per year of incremental financing to meet the needs for climate change climate adaptation high vulnerability and the SDG transformation agenda there are a number of ways that this funding could come one of the most promising is a massive increase of long-term loans from the multilateral development banks like the World Bank the Inter-American Development Bank the Andean Development Fund the European Investment Bank the African Development Bank the Asian Development Bank the Asian Infrastructure Investment Bank the Islamic Development Bank and others in other words all these banks together currently have annual lending of about 120 billion dollars a year but it should be I would say at least 500 billion dollars a year it turns out that a small amount of paid in capital can go a long way for 20 or 40 billion dollars we could get an increment of maybe four or 500 billion a year well let me pause here to say we need increased investment based on country needs we need it now especially in a period of tightening private capital rising interest rates war sanctions and pandemic that's the agenda we need to use new instruments like the multi-dimensional vulnerability index but also the straightforward excellent measurements that the IMF has been making in recent years to identify the unmet SDG financing needs but instead of only identifying that we have unmet needs and several hundred billion dollars it is now urgent to close that gap we have the G20 finance ministers meeting just now the G20 will be in November COP 27 will be hosted by the government of Egypt and Sharma Shaykh at the beginning of November then Indonesia host the G20 in Bali in mid-November this is the opportunity to get our system fixed and that's what we're working towards so thank you very much I hope the connectivity was it was okay apologies again for coming in late and I turn it back over to the the panelists for this excellent meeting thanks so much thank you so much professor sacks I'll transfer the floor to dr. masa just to thank you very much and to also express our hopes that this is the year in which access to development financing will be redefined colleagues if you want to read a new approach to global financing there is a distinct chapter in the sustainable development report 2022 that as the ascent has issued thank you very much indeed dr. masa over to you Simona thanks professor sacks for this enlightening discussion and thanks also to you Simona for your presentation on all the work that you are doing with all the seats or resident coordinators on both the nbi on addressing the issue of measuring the sdp financing in small island developing states so I'm now on or let's move on to our second speaker of panel one so I'm now honored to welcome Dr. Valerie Sarah she is the assistant director in the fiscal affairs department of the international monetary fund she has published extensively on several different topics ranging from international macroeconomics to financial crises economic scarring as well as inclusive growth so we are really pleased to have her with us today so Valerie can you briefly tell us about the work that the IMF is doing on sdg costing and on other sdg related issues over to you Valerie the floor is now yours thank you very much here I will share the presentation yeah so the previous speakers mentioned the urgency and the importance of financing for sustainable development the IMF contributes in many ways through lending surveillance and capacity development I'm going to focus my remarks here on some work we've done as was as professor sacks just mentioned on measuring financing costing and measuring the financing gap and and the framework for that so in recent years the IMF has extensive work in developing monthly costing needs so I list here a few of the key publications that have come out in recent years even before the before the financial crisis sorry before the the crisis of the pandemic there was work on costing five key sdgs intended for public expenditure once that contribute most to public expenditure there was additional work done to assess the post pandemic situation for these same sustainable development goals and I also highlight here the recent working paper which is focusing particularly on small developing states with climate vulnerabilities and so the methodology includes costing measuring the gaps along five key dimensions in addition to that really embedding this with a medium term and long term framework to measure the different financing gaps and and put it in the context of revenue mobilization economic growth and other related macro variables so just to give illustrate for a moment the framework so these publications and these estimates are are based on a dynamic macro model which includes private resources as I mentioned there's a lot of work that has done that is focused in particular on both human and physical capital sdgs measuring the the gaps in education and health and among the infrastructures water roads and power in particular this is a growth model so the variables are all related to one another to the development of government revenue and to the different measures of different means of financing these gaps either through domestic revenue mobilization through domestic land domestic instruments and through international lending so to highlight for example some of the results this I show you here is from the recent publication for small developing states those with climate vulnerabilities where you see for the different income categories the average estimates of needs in percent of gdp in percent of 2030 gdp by the five main sectors energy roads water and sanitation and hygiene health and education and as you can see that it's a quite evenly split between human and physical capital needs and on average for these 25 small developing states the average need is about 6.7 percent of gdp but obviously it varies considerably by by country so this work we are continuing with this work this work draws extensively on international indices so the new index being developed will be of great use as an input and we're extending the work in particular to incorporate climate climate vulnerabilities adaptation and mitigation needs and with that I want to mention an additional initiative along these dimensions this is a pilot program that the IMF is currently working on which is called the climate macroeconomic assessment program and so far there have been two pilot cases Samoa was the first one and Madagascar the second one and this is really looking at assessing the climate macroeconomic situation along many dimensions but the macroeconomic implications are are critical so this incorporates long-term projections of the impact of climate change the needs for resilient investment to meet the SDGs and incorporates other elements too like improvements in public financial management risk management and focuses both on adaptation and mitigation plans so this incorporates macroeconomic modeling and well where we intend to move forward from here is to further develop the macro financial framework for the SDGs by incorporating various elements of climate both in terms of any upfront mitigation investment that would be required to transition to a greener energy mix as well as many dimensions of adaptation that also by the way impact the achievement of other SDGs because they interact with education and health in particular health and of course the the costs of providing access to water and electricity and roads also must incorporate climate vulnerability to ensure that the investment is resilient to potential climate hazards so I will stop there and happy to take any questions later. Valerie thank you so much for all this explanation on the great work that the IMF is doing on measuring the additional financing spending needs to achieve the SDGs and also on other issues related to the SDGs so thank you so much and now let me make a slight change in our agenda we are going to include in this panel Professor Perceau that was supposed to be part of panel two because he has to left and unfortunately we have a bit of delay so let me introduce Professor Avinash Perceau who is a meritus professor of aggression college and also special envoy to the prime minister of Barbados on investment and financial services. Avinash has a great experience on international finance on investment so we are really delighted to hear from him and we know that he also would like to say something about the nbi the multi-dimensional vulnerability index so over to you Avinash the floor is yours. Great good good morning everyone and let me thank you Isabella for your wonderful organizing of today and this event and all the hard work you and the team have been putting in on these quite important issues and I apologize I have to leave early we in the Caribbean as you know have the most expensive transport in the region and we are in the middle of some intense negotiations on trying to introduce a fast ferry system to move people and cargo and unfortunately those negotiations are going on at the moment this this minute. We all know why we're here the issue of achieving the sustainable development goals the financing gap to achieve the sustainable development goals most vital issues to humanity today but of course for those of us on the front line those of us in vulnerable states and in countries with substantial poor people and poverty we're not interested in in virtuous positioning the professionals around this table are not interested in virtuous positions we need actual progress so we need to identify the obstacles to progress and find solutions to progress. Let me say a few words about the multi-dimensional vulnerability index this is a topic I have I have personal interest my father was one of the very first people to commission research on the vulnerability of small island development states when a number of them began becoming graduated by the World Bank and this was this was in the mid 1980s when the idea that vulnerability and small states was really very fresh and if you if you look back at the very beginning of this debate it begins with that those first commission reports. We we think ultimately this is an empirical question the question we're trying to ask is how do we come up with a measure of vulnerability that that is not captured in in the GNI so we're actually not this is a very so that's the main task and let's we really need to see the results because there are a few multi-dimensional vulnerability indices around some of them that have been produced and we've seen results do not actually achieve the task of identifying the special vulnerabilities of small island development states for the universal indices and we believe there are three fundamental reasons why that's happening and we are very supportive and encouraging of the efforts being done by the UN but we believe there are three fundamental issues that that the MVI will need to deal with. The first one is we're trying to complement GNI so we're really looking at vulnerabilities that are intrinsically different than what is already captured in GNI and of course the problem is that when we start including economic vulnerabilities and I think you've made a wise choice in removing some of the social vulnerabilities not because they're not important but because they're outcomes but when we start increasing the number of vulnerabilities that we include you actually find you begin to converge on something very similar to GNI in terms of the ranking of countries and the work we have done has been has shown that the more you increase multi-dimensions and poverty is a multi-dimensional and vulnerability is a multi-dimensional activity the more you end up with a rank that looks similar to GNI and so we're not achieving the task which is to identify those vulnerabilities that are orthogonal are different than GNI and indeed you know small island development states we believe we're highly vulnerable but when you go universal you start looking at vulnerabilities of a large number of countries that we don't have that they have. Sub-Saharan Africa has a set of vulnerabilities that are real and genuine that need to be in any universal index that we don't have and when you start looking universally you will find that it does not really change the position of the small island development states in the debate for more development financing relative to other countries because of a unique set of vulnerabilities. I think the second issue is that as you become more complicated and involve more multi-dimensions you're going to have methodological debates there will be people who will say well my index is different than your index and there will be other indices and there will be a whole wealth of indices we're never going to have one index we're going to have a set of indices maybe that people prefer but there will be other indices it will always be an aspiring academic looking for tenure who will come up with another index and so I think the more we go multi-dimensional the more we can have methodological debates and potentially be drowned by methodological debates. The third issue is that you need something that at the end of the day we are seeking a political purpose we're seeking a purpose which allows allows us to achieve a greater share of development finance because of genuine vulnerabilities. It has to be compelling and if you come up with a multi-dimensional vulnerability index and you come up with a number then no one can really tell you exactly how that number is come up developed and it includes many many things it's not it is not compelling it is not something that people will feel and I think that's going to make it hard especially when we know today that when we talk about the SDGs when we talk about poverty and the genuine issues of vulnerability finance is not there and so the more we we have a non-compelling number is it is it clear that it will impact our political task of getting more development financing and that is why we await the numbers we wish to see the universal index and how it comes out but we wish to raise our belief that there's some fundamental inherent challenges in this route achieving what we want to achieve it may become a very good measure of vulnerability but it may not achieve what we wish to achieve we believe there's something far more compelling and this was raised by your IMF speaker raised by our great mentor and person of who's inspired us Jeff Sacks climate vulnerability sits come top of the class on climate vulnerability climate vulnerability is compelling people understand it people see it climate vulnerability will be a way we think an easier way in which SIDS can get a greater share of development financing we therefore encourage and support the work the IMF is doing on the climate macroeconomic assessment we think it's very real we think and let me move on to the last couple of minutes of my conversation on financing options we believe not only is climate vulnerability compelling not only is it real not only is it the only subject today in the global arena in which people are putting more money towards where do you have a debate of 192 countries meeting every year at COP for instance where they're discussing financing mechanisms of tens and hundreds of billions of dollars we should be having that on poverty on inequality on access to pure portable water but we don't so climate vulnerability is not only compelling it sits are not only vulnerable to the climate but it is the one door that is open in finance so I believe we should go through that door we should come up with an indicator of climate vulnerability now let me end by saying that the purpose of what we're trying to do is say there are set of countries that are not LDCs who have access to concession funding but have a degree of vulnerabilities that suggest they should be and that means we're talking about essentially middle income countries and the middle income financing options and of course as you know 75 percent of the world's poor 75 percent of the world's poor do not live in LDCs so if we are concerned about the poor and the poverty as we as we are then in fact we do need to think about how we look at them at middle income countries so we're looking at a middle income country problem and that's very different than an LDC problem I'm not saying that the LDC problem is not something we should look at but debt cancellation works for LDCs it does not work for middle incomes middle income countries which are involved in the private credit markets and need more and more financing going forward so we think that we need to widen the eligibility of concessional financing to include climate vulnerability it's simple it's compelling it's got political status in today's world we think we can win that we think we can win that at COP 27 and COP 28 whilst we have been struggling for decades to win what we should have won which is more financing for the MDGs and now the SDGs secondly we think the development banks like Jeff Sachs said should be given more ability to lend for the concession of financing we believe that is about small amounts of additional capital we believe they should be able to hold SDRs and to be able to count that as part of their capital to raise more funding 50 to 100 billion of SDRs could get us to the kind of half trillion per year of extra funding we need from the multilateral development banks thirdly we're talking about middle income countries in the capital markets we need different types of debt instruments we recommend the Barbada style natural disaster clauses we are pushing for Britain and Canada and America to also issue the same structured bonds if all of the world had Barbada style natural disaster clauses when the COVID crisis happened developing countries would have had access to one trillion dollars of liquidity one trillion dollars of liquidity there is no alternative financing option that would have given them that and as you know about the disaster clauses the two years your debt is suspended it's added back on to the end of the term out with interest so this is not a bet on a disaster you'll get the net present value it's the same it's about providing liquidity at a time over disaster and finally you know we need loss and damage funds we know that these funds need to be grants they cannot be loans you cannot go to a Dominica's lost 200% of their GDP in four hours and say here's a loan we need grants now the world does not have grants to give we need to have we need to channel all the grants into loss and damage we should not be using grants for climate mitigation the private sector can finance that we should not be using a grants for climate adaptation we need concessional funding from the mdbs for that we need grants for loss and damage but we need to supplement those with a 2% levy on the consumption of fossil fuels to go into a loss and damage financing facility and that would support all countries suffering from a climate climate vulnerability let me end there I apologize for being difficult and inconvenient when people have done so much hard work but we are anxious that we are not going to achieve what we want to achieve when it comes to the the multi-dimensional vulnerability index we believe we can achieve what we want to achieve by focusing on climate vulnerability we believe we need new financing instruments the bar beta style natural disaster clauses more concessional funding but with sdrs and a loss and damage facility thank you very much indeed thank you so much avinash for all these insights on the nvi and also on the issue of a stepping financing and importance on focusing on climate vulnerability and developing i mean a new tools for addressing this issue of vulnerability thank you so much and given the tight schedule that we have let me move directly to the next speaker of a panel one as well so i'm now honored to introduce mr paul akibumi who is the director of the division for africa least developed countries and the special programs so paul has extensive experience in the area of development policy among several other areas and in addition to these he oversees the work on the least developed countries report which is one of unctad flagship publications so so paul is unctad using any specific method to gauge a financing gap in ldc's and do you have any specific faults in relation to small island developing states over to you paul the floor is yours thank you very much indeed i i think and thank you very much for having me and for listening to the previous speakers has been very interesting and and thought provoking i think moving forward uh one first i believe without regard to financing i think one has to recognize the the true scale of the problem that we're in and this was mentioned partly by jeffrey sax and others but i think it's worth reiterating and i think it's worth also mentioning additional areas that we have to consider which we have not been considering and we all recognize that we're going to cost a living crisis a food crisis and the price of fuel has gone up but and then also the covet band but i think we also have recognized that in today there are over 50 percent of the sids which are in debt stress or almost in debt stress and over 60 percent of ldc's which are in the same condition that they are now um debt stress but i think what is missing also that we have to consider is that there are many international major international agreements and events which have implications on countries achieving the stgs and financing of the stgs mc12 which just concluded has major implications with regard to the agriculture subsidies compliance for ldc's and ldc's and sids also with regard to illegal unregulated fishing the compliance regulation these are additional burdens which are going to be put on these countries and require additional financing for that i think it's also important to recognize that in this global economy and this is a political economy that's going on there are economic partnership agreements which are being drawn up and these economic partnership agreements have considerable uh uh uh regulatory frameworks and and issues which ldc's and and sids have to comply with as well um so these are some of the areas i think we need to also consider and lastly just to mention that the european union with their trade and and uh sustainable development provisions of the european trade agreement which was just adopted in june 2022 places additional burdens on countries so it is not just about the global context in the sense of the the the the shocks that are going on but it's about us recognizing the international agreements that member states are signing and the implications will have and therefore the implications of cost on the ldc's and sids example of this is if you're moving towards a low carbon economy you know the four important shifts that will happen if you have a changing global demand pattern you will have evolving regulatory frameworks which i mentioned but you have an increase in the new generation of technologies but also you'll have an appetite for more sustainable investment and although this will all provide naturally some green opportunities for ldc's and everything in vulnerable countries um it is important to note that they will also have negative consequences on sectoral parts of the economy which could which is important here if they're not getting the financing which could entrench them you know even further and marginalize them even further in participating in the global trade and in production and of course environmental conventions that we are actively all signing and we all aspire to and find important they are meeting they are strict standards and and monitoring regulations and tracking to come back time to change so this is a lot happening in fact it's it's ironic because i i fly swiss air quite often and they had just sent an email to all their the frequent flyers indicating that they're having big problems in having the capacity and social capacity to start taking on the regulatory arrangement that the EU has provided so if that swiss air is saying that what about all the other airlines of all the other developing countries around the world so i think these are critical things that we have to to bear in mind because these global agreements have legally binding conditions related to them and they create as i mentioned more burden more cost we've got resources we've got human capacity and then the question comes in here about just transition just transition into a green economy and this is critical for member states to recognize this so that they can provide the right policies to ensure that this happens now for my intervention here i'll quickly just mention focus on two key areas is about external debt which i mentioned earlier on of of these synths and and lldc's and least developed countries which is critical and secondly how to we have sort of tried to calculate in some way the stg's that we believe are necessary for to achieve structural transformation now as we've heard from our previous speakers that natural disasters are key element of concern for synths and we estimate that they on average it costs them 2.1 percent of that gdp every year and so this this is critical but it's not just about the reconstruction requirements for which requires mass massive financial resources but it's also it's it's which is also done through external borrowing but it's also more importantly it's about the financial cost of post disaster recovery not just a post disaster like i mentioned but it's also the pre disaster financing so this is another critical area which we've identified which was acquired for resilience building it's also important because a lot of this is which is happening now the borrowing that is going on the capacity to absorb the financing to deal with the reconstruction caused by the natural disaster is another issue but also the fact that less funding is being available for the social programs of the country and this leads to more complications with regard to the the just transition and the people of those countries now so therefore we we strongly believe also there needs to be stronger multilateral cooperation and greater flexibility with regard to assessing the pre and post financial instruments but also the financial instruments that are required we strongly believe at this point in time that the financial mechanisms that have been put in place have never been adequate and because of these compounded additional requirements that have been put on on on on citizen and ldc's they certainly need to be looked at as a new wave moving forward but then again also that's important that governments look within themselves and within the policies they have and try and address some of the problems to be able to to bolster that domestic resource mobilization and here with SIDS financial leakages are considerable in the tourism sector we estimate about 60 percent of the of the financing stays outside the country and and this is important that they have the right uh of policies to put in place to ensure that they get the greatest benefit from from this from this tourism industry this this comes in meant the leakage is coming many forms it's simply booking making bookings of tourists going to to those uh that region 60 percent stays outside the country 40 percent goes into the country it's about the goods and services provided for the tourism sector most of them being net importers it's all being imported so there needs to be a backward linkage into the economy and it has to drive that economy to be able to to to be able to deal with the leakage and reduce the linkages um i think also what is is is clear that with the with the servicing of the debts that's going on in in SIDS and and least developed countries the majority of the debt servicing of the of the debt uh the i'm sorry the majority of government expenditure is going to the servicing of the debt and there's very little left money left for any other development policies um right now uh we estimate that like i said 19 out of 38 SIDS are either in debt stress or going through debt stress right now and with ldc's 17 are high stress five and in debt stress and 17 are always in immediate stress so it's it's important that we try and move along how to manage the the debt and um tad has a number of recommendations how we are helping countries do it and one thing is to help countries with our tools innovative tools is to build the financial transparency uh and support domestic resource mobilization and with the domestic resource mobilization we have a an innovative tool which is automated systems for customs data a secruda program which is designed to assist member states in reforming their customs regime their procedures their systems uh in line with international standards but more importantly also to improve the efficient collection and management of government revenues and then we have our debt management and financial systems uh which also helps countries strengthen their capacity to manage that debt and it also assists in the monitoring reporting to the imf on the standards and we believe that bolstering international support uh bolstering international support support these countries is critical and there is i will finish very shortly sorry to yes thanks if you cannot conclude because we are really running out of time so thank you yes and so to to also as as our previous speaker mentioned about the insurance factor the importance of that and we're working with the v20 to try and move that agenda and also about economic diversification and that we believe is a very strong part and that's why we have our multi-dimensional uh productive capacity index but the important thing about this is not just when you get the financing whether you have the capacity to produce goods and services and this is an index which measures that capacity to produce goods and services so that's also critical and for many islands states the importance of the blue economy and it's not just about the fisheries and tourism and the transport is about bioprospective it's about high value when there's about nutraceuticals it's about the pharmaceutical industry it's about the cosmetic industry so these are some of the key areas that I think we need to the the thing about quickly on just two things is that the approach we use to measure some of the stg's one critical area is that we didn't look at all stg's we just looked at the stg's that we believe can support structural transformation and we were able to look at forecasting that and be able to look at how we can come up with figures about how we can improve those stg's and there are in the multi millions I won't go through them but you can check on our online 2019 least developed country report which has a methodology and also the different stg's but it's quite clear that both the important aspect of this is that we looked at how structural transformation can be achieved and I think that's one of the key things it's not just about receiving financing it's about using that financing an effective way to build the resilience of these countries so let me end there and happy to take any questions I will have to leave soon I have another engagement but happy to take any questions thank you very much thank you very much Paula for all the insights and for all the work that unctad is doing and that represent a key contribution to the international community effort to construct a more promising developmental horizon for poor countries especially in the post pandemic decade so now I thank you again all the speakers of panel one and I will now pass the floor to the UN resident coordinator for Barbados and Eastern Caribbean Mr. Didier Trebuch who will moderate panel two so over to you Didier. Good morning good morning or good evening everyone thank you Isabella very interesting and thoughtful debate so far I must say so we're now moving on to the second panel which will address the issue on how to finance the SDGs and here are some lessons learned and recommendations on the way forward so this is a good transition given that we have heard about the methodologies to better measure the SDG financing gap and vulnerability so we are a bit late in the program but we make sure that we take the necessary time to hear all presenters that are here today and if time permits we take some questions and answers what I would like to request before minding the the lead question is that intervention can be done within the context of the high level panel finalizing recommendations to develop new metrics to account for vulnerabilities and the beyond GDP agenda that the UN Secretary General is spearheading and this can also be done within the context of the UN global crisis response group on food energy and finance and the working group that the Deputy Secretary General has set up with Professor Jeff Sacks on financing the the SDGs so let me turn to the the lead question and as you know we'll meet term of the agenda 2030 and following the COVID pandemic and now the triple crisis the progress to achieve the SDGs of course seems to be almost stagnating in many places some countries are losing years of development gains despite commitments and resources being invested and as we have seen in the panel one and some of the presentations done and our analysis showed that to a large extent progress is not being sustained you do limited financial resources that countries have access to and especially countries with high vulnerabilities such as seeds or LDC so I would like to to ask you first what would be your advice that you can give to governments or multilateral development banks for example as to how to secure or make available the necessary resources to continue the sustainable development journey at this time of multiple challenges and second what would fundamentally change or should fundamentally change in the global financing system to close this important SDG gap that was mentioned by Professor Jeff Sacks of about one trillion dollars a year so each panelist you have around two seven minutes to you to do your presentation and I will now turn to Mr Olivier Cataneu Dr Cataneu is the head of police analysis and strategy at the OECD development cooperation directorate is an adjunct professor at the Paris School of International Affairs in Sciences and Paris leaves as also work at the World Bank in Washington and with the AFD so Mr Cataneu will share insights on what are some of the fundamental changes that need to take place in the global financing system and what are the actions taken at the OECD so Dr Cataneu you have the floor thanks a lot moderator and thanks to the host for the kind invitation and all the fascinating I mean presentation so far I will go straight to your questions and just points at two lessons learned so far from the financing of the SDGs and two ways forward on the lessons learned first I mean clearly I mean it's not enough I mean what we have on the table to finance the SDGs it was said and it was said also that unfortunately we are going the wrong direction because the SDG financing gap is growing this is in part the result of the COVID-19 crisis that had what we call the scissors effect with the growing needs and at the same time dropping resources so the SDG financing gap could have increased according to our calculation by more than 50% since the COVID crisis the crisis has also magnified and some pre-existing inequalities inequalities among countries and to give you an example the per capita fiscal stimulus was 700 times higher in high income countries than in low income countries in response to the COVID-19 crisis access to vaccines was seven times higher but not only among countries also within countries we see that unfortunately some communities have been more affected by the crisis such as women and children in particular we see for instance that 50% of the children in sub-Saharan Africa or in Oceania lacked access to education during the during the pandemic so there is a risk of great divergence I mean that had been evoked during the last annual meetings of the World Bank and IMF and Professor Jeff Sachs I mean mentioned this vicious cycle of of getting indebted and having even less resources to fight the next crisis because we know that crisis come with waves and we know that for instance the health or climate crisis can trigger economic social and political crisis that cost even more to to handle another lesson from the crisis is that we saw that we are all interconnected when it comes to the SDG agenda that's that's obvious but we need to reinstate that we cannot progress make progress on the SDGs in one country without making progress in the other countries because you never know where the next crisis will come from second lesson learn is that unfortunately I mean the road to hell might be paved with good intentions as we say the crisis has accelerated what we call the sustainability rush which is a greater demand and supply of sustainable finance on global markets so this is a unique opportunity for SDG financing and we need to to to seize it but at the same time the preliminary evidence we have collected shows that this bright force sustainability has further concentrated the finance in the hands of a very few to give you a few numbers I mean to illustrate that we knew that 80 percent of global assets under management were in high-income countries so this is already pretty bad when you look at the newly established sustainable finance funds they are concentrated for 97 percent in high-income countries which is even worse when you look at Sub-Saharan Africa which represents only 1.5 percent of the green bonds I mean by number and 0.3 percent by value and only 8 percent of climate finance mobilized for the developing countries go to the LBCs and since we are talking a lot about the seeds it's only two percent for the seeds when we know they are the ones with some of the greatest needs so action is needed and on the two ways forward that I will suggest the first one is to enforce what I will call the equity pillar of SDG alignment so there is lots of progress made on sustainability but if it's not needs based and only further increases the concentration of finance in very few high-income country or emerging countries that's not satisfactory so we need to shift the trillions not only by going from non-sustainable to sustainable but also by moving the frontier of a sustainable investment to include the most vulnerable countries that we have been discussing today something we are exploring at OECD for instance is how to go from ESG to SDG for many it sounds more like a semantic change ESG to SDG a northern acronym but it's much more than that and we need in particular to for those who claim that they are SDG aligned make sure that they also commit to invest a certain percentage of their assets in the most vulnerable countries the second way forward is that in order to make this shift we need a collective action and we need that all actors along the investment chain to take part in the change and that's something we are explored for instance in the OECD UNDP I mean framework for SDG aligned finance and we looked at three layers of adjustments that are needed of course in developing countries themselves there is lots that needs to be done I mean to make them more attractive we need to build a pipeline of bankable sustainable projects when we need to deepen the financial markets we need to adopt sustainability reporting standards and so on and as Professor Sacks said we need to align the financing the budget strategies with the SDGs are better but that's not enough we need to look also at the intermediary actors business investors and make sure they have a more responsible conduct and the donors also need to work with the investor to develop I mean the risking instruments reforms the risk measurement mechanisms with systems like blended finance warranties and so on that need to be scaled up to to make it happen and Professor Sacks also mentioned the cost I mean that is related obviously to those practices that needs to lower and finally and we need also to work in the countries of origin of the investors to avoid the diversion of finance away from the SDGs for instance when we have still billions of dollars of subsidies to to fossil fuel which is not coherent with the with with the alignment with the SDGs or another point and that's what I will conclude with is is the question of ESG or SDG washing that we really need to address because these are wasted opportunities people want to make their money work for the SDGs and unfortunately because there are no rules about the labeling there is no monitoring no assessment of the impact of the SDGs the SDG targets are not necessarily appealing to the private sector this is sort of wasted money for the SDGs and that's something that we need to address so I will leave it here for the sake of time and thank you very much for for the time thanks thank you very much dr cataneo excellent insights lessons from the crisis that you have presented and remaining the concentration of finance is indeed in high-income countries something important to be changed and some of the solution like scaling up financing instrument with a view also to lower the cost so amongst others so thank you very much for this intervention given time constraints and some of the panels that are to leave I would like to invite now miss Josephine Pagani she's former executive director of the council for international development Joseph Pagani has worked in aid politics trade and media she was an inaugural member of the New Zealand government's trade for all advisory board and it's aid for trade external group she's been involved in several progressive think-thanks in UK and Europe and we thought that given your high-level experience in the aid and development sector as well as political advisory function it would be very very interesting to hear from you today and particularly some perspective from a civil society angle so miss Pagani you have the floor Kia ora I'm not sure if you can see me but as long as you can hear me Kia ora koutou ma loa le le talofa lava kiorana bula warm Pacific greetings I'm actually in Austria and traveling back to New Zealand so thank you so much for accommodating my schedule because I'm about to jump on a train and and then catch plane but and please let me know the the Wi-Fi should be good but please let me know if you have any any problems so I've turned my video on but I can't seem to control it from here the host has disabled it but shall I just carry on yes carry on please while we're okay all right okay um so I what I want to talk about we've covered I think a lot of the context the problems that we have we're halfway to the SDGs we are no way close to being able to fund them and and achieve them and I wanted to talk about two barriers that I think exist one is political the other is strategic and then talk about what I think the way forward is so politically you know of course we know we have covered we have the insecurity of war in Ukraine food insecurity the the key thing I think for this about in terms of investment whether it's investment from governments or whether it's investment from the private sector is that we are predicting and many are predicting an increase in unrest and riots and so to quote the economist recently they said all around the world inflation is crushing living standards stoking fury and fostering turmoil we've seen it in Sri Lanka we've seen it in our own region in the Solomon's we see it of course in in in the most vulnerable countries and the thing about violence and and unrest is that investors hate riots and revolutions and unrest and there's a statistic again from the economist which says that every big violent event usually reduces GDP by about one point the next 18 months so we're in a very very volatile environment and you know there isn't much support amongst voters and citizens for the SDGs they're not even sure what they are and so politicians and also potential financiers whether private or or um outside of government understand this so you know the question is how do we build the social license to fund more um and to put more funding into the SDGs um I also wanted to highlight I think a real problem we have which is the decline in trust for international organizations amongst voters and citizens and the war in Ukraine has of course demonstrated this in a tragic way where the UN has been unable to respond because of the veto security council I think what we're seeing is a lack of trust accelerating amongst citizens um for international organizations to solve problems and the SDGs are um unintended victim of that thinking uh but you know we know that NATO in Europe has actually gone up in support uh since Ukraine I think 70% of citizens in the EU uh have now support NATO um but I think this is a very politically a very uh real barrier to funding the SDGs further um I know a statistic in the United Kingdom where now 30% of people in the UK that's 14 million think that they would rather have a strong leader who could bypass parliament and get things done so that is a real worry because I think if we see an increase in political unrest in authoritarian governments from donors we are not going to see the funding for the SDGs materialized the second challenge is strategic and again we've known this all of us working in the SDGs that there's so many of them that it's hard for politicians or or funders or citizens to focus on what what can be done it feels like white noise to them and it's much easier to raise funding if you are saying net zero climate change or don't invest in fossil fuels invest here and that's why I think we need to have a very clear message about what it is we're asking finance financiers and other alternative vehicles for funding to finance which which SDG so summing that up I I now want to say what I think the winning approaches from here on in what we can do to to deal with those barriers and the first one I think is to apply the same thinking that we apply to political campaigns to the SDGs and that and I know I've mentioned this before at forums like this but you know a political campaign must have three winning things one is edge it must have cut through cut through into the busyness of people's lives and also cut through for potential financiers to finance the SDGs very specific it needs crunch that's the second thing very a very specific call to action what is it is it digital connectivity is it tv is it malaria is it infrastructure is it is it broadband and so on and the third is lift it has to inspire people it has to inspire politicians and citizens and that will also inspire funding so the other approach that I think is so important I think the nvi the index is so incredibly important and helpful it helps us you know analyze the vulnerabilities as we've spoken today but I think it also has to be combined with a very clear cost benefit analysis that will help the prioritization and and I know a few people have mentioned this you know how do we prioritize what is the prioritization approach and I think if you have a cost benefit analysis that allows you to work out okay what are the top priorities and most importantly that this analysis is owned locally by local governments local civil society local businesses and it uses local systems wherever possible so it's owned by the developing country by the said not by the donor and I think this clear call to action in terms of the top priorities is is the way forward and and I'll just give you to end a couple of examples we know in the pacific and I know Simona will agree with me here that we are hearing again and again the top priority for pacific governments and pacific civil society and business is digital connectivity that is the answer for many for education for access to markets for access to health advice online and so on so it may well be that if you go here is the specific call to action digital connectivity attached to the SDGs and and this will make it easier to raise finance and I'm working at the moment on a Bill Gates Foundation project which is called the half time for the SDGs where to invest best for the end game and and this is exactly a cost benefit analysis and we're doing this with Tonga and we're also doing it I hope to be doing it also with Samoa but this is about going right what are the top policies and SDG framed policies that you want to prioritize and then let's do a cost benefit analysis and critically it will tell us also what not to put the money in two straight away so what is the top priority one other example is the Haitian government with the support of USAID USA launched a food fortification project after doing this very clear cost benefit analysis the first priority was to fortify the food and then in Uganda another example where the cost benefit analysis was done the top priority was to keep schools open during during the pandemic in some way to improve the earning future earnings of children but also to focus on malaria and tuberculosis so there was a very clear cost benefit analysis to go these are our top priorities and then there are there are priorities that may not be as as high and critically it tells us what we don't necessarily need more money for even if they're really important like corruption because that might not be the best way best place to put your money so in conclusion I think we need to run SDG campaigns like political campaigns with a very clear call to action a very clear target and that'll be different country to country to country and the second priority is that the index can be followed up with cost benefit analysis in each country and it is owned by the local country not by the donor not by the development bank and that will help governments to prioritize and it will help civil society to also be part of that process and I think this is the only way that we will really accelerate the urgency for the second half of our SDG period of time finally my my I have a wonderful quote from the Prime Minister of Samoa Prime Minister Thia May who says that a return to business as usual in aid pre-COVID will not be acceptable we have to do things differently and I think we have some great ideas here to do things differently so Kia ora thank you for letting me jump with you and I will finish there Kia ora kata thank you very much miss Pagani for those excellent insights especially for highlighting those challenges to increasing finance such as political barriers but also digital connectivity oh now we can see you good that this is what I look like very good and I appreciate that you mentioned the importance of the nvi to prioritize and the importance of local ownership for any analysis including cost-benefit analysis so thank you very much for your intervention today given the time I would like to invite Ambassador Luteru Ambassador Luteru is the permanent representative of Samoa to the United Nations he has a short message to deliver to the group that was supposed to be at the end of the panel but given the time we would like to invite him to deliver his message over to you ambassador thank you very much and I apologize I've got some other engagement I thought we would be sort of finished by now but allow me firstly to thank all our presenters and panelists and to commend them for the clear and insightful presentation that has been made so far the depth and breadth of experience demonstrated and their knowledge of the topic cover in my view is commendable and I'd like to thank them for sharing but I also want to say that whilst I have learned new things in terms of our discussion today a lot of the things are not new in terms of concern and therefore I think we need to see how we can actually convert some of these proposals and recommendation in terms of action on the ground moderate I do not intend to perhaps summarize what has already been said I don't want to run the risk of offending our panelists so if you allow me I would just like to focus on a few issues which I believe are important firstly just let me say that Samoa is honored to be part of this conversation on how SIDS can narrow the financing gap that currently exists and thereby contribute to meeting our SGT's obligation and begin the long journey to economic recovery post COVID actions and common action is a strategic necessity that we need now we cannot afford more talk shops and urgent action is required to fuel genuine partnership and global cooperation to achieve the SGT there is no doubt of the central role of the MVI in facilitating the path of SIDS to realize the SGT and achieve the objective of the Paris agreement and by extension the Samoa pathway the vulnerability of SIDS we have already heard very clearly have been well argued and advocated from the Pacific perspective Pacific SIDS perspective the MVI will assist in preaching the financial divide between the developed and developing countries the vulnerability of SIDS needs to feature more prominently in the criteria for ODA allocations access to concessional financing and for the establishment of an effective sovereign debt regime if we are to make substantial progress towards the achievement of all the SGT's we need to rethink our means of implementation at the global level working in silos is not the answer as was painfully demonstrated by the global response to the COVID pandemic more global crisis unfortunately will come they will require a multi institutional and multi stakeholders respond and perhaps an all of government approach a body capable of bringing together multilateral agencies international financial institution and government ministries to address mega crisis in the future merit serious consideration and at the core of any reform of the global governance structure is the central tenant that member states remain the final arbiters we have heard that little to no progress towards the SGT has been made in the last two years COVID and Ukraine can be plain but perhaps there is another reason as the secretary general pointed out at the beginning of the year the global financial system is morally bankrupt and not fit for purpose the question that I want to pose and it's very simple who has the authority and commitment to effect the necessary changes and direction who are the rule centers in this space professor sack has spoken about the capital markets what is the role of capital market in narrowing the financing gap we witness in classical the launch of the classical financial alliance for net zero with 130 trillion we also have the mobilists an initiative by the UK government not to mention climate bonds strs and other similar initiatives in all of this my worry is that if we do not coordinate effectively with all the stakeholders we're going to find ourselves in more problem and here I just want to offer a word of caution and that is that in our haste to solve one crisis we must be careful what that we do not create another one let me conclude by thanking our organizers for bringing us together and for sharing the expertise and the knowledge that have been put on the table but again I go back to what I said that in some ways we need to see how we can bring all these fantastic ideas and recommendation into fruition because at the end of the day if nothing comes out of this maybe we'll come next year following year and we'll be engaged in the same conversation so thank you very much for the opportunity and my apologies as I already have another point that I need to attend to all the best and all success in the you know the final presentation that is to come thank you very much Ambassador thank you so much I asked Lydia to allow me to say a few words so we thank you very much for joining us for the meeting and just to mention that we count on your thought leadership on the highlight panel to complete the nbi development but also to request the panel to create the open space for further discussions as to how the nbi should be used and this then of course our responsibility to push international organizations to align with the new vision and as you said guided by national governments thank you very much indeed appreciate it did you over to you thank you thank you thank you Simona thank you ambassador for sharing your insights and take away we'll carry on with the program I will now invite Mr Oliver Pattison Mr Pattison is the chief of section for countries in special situations in the office of the executive secretary of UNSCA being the UN economy and social commission for Asia and the Pacific so we share with us some of the finding of a recent report that was published precisely focusing on Asia Pacific countries with special needs so the floor is yours Mr Pattison great thank you thank you didier I'm actually connecting from two different devices audio is on one stream video on the other so I hope that's not too confusing good morning good morning good afternoon and good evening ladies and gentlemen and thank you for inviting me to this event it's certainly my pleasure to speak here in this panel I'd like to under I'd like to start by underscoring the importance of paying attention to vulnerable countries for SCAP which is the United Nations Economic and Social Commission for Asia and the Pacific in fact of our 62 members and associate members 37 are either least developed countries landlocked developing countries or small island developing states which we kind of refer to as vulnerable countries or in special situations now despite this large number of countries these are heavily underrepresented in the Asia Pacific's regions economic activities and they account only for 3% of the region's GDP and about 3% of trade and goods and services let me highlight that the Asia Pacific countries in special situations were not on track to attain any of the 17 STGs even before the onset of the COVID pandemic and clearly the the pandemic is further dampen their prospects we've estimated that an additional 7.8 million people were pushed into extreme poverty by the end of 2021 in these 37 countries and the median fiscal deficit increased from a pre-pandemic of about 1% of GDP to 4% of GDP in 2021 also as we saw the the median debt to debt to GDP ratio increasing by more than 4 percentage points now while these challenges are not limited to the countries in special situations they're limited coping capacity and particularly their narrow domestic resource base and the limited options that they have to raise resources suggests that the road to recovery will certainly be more protracted we heard earlier that the magnitude of fiscal stimulus in LDCs has been significantly lower than in other developing countries and and this points to the risk of a k-shaped recovery in which some countries of some groups of countries may may be recovering much slower than others and I think this is certainly a cause for concern there are only eight years left until 2030 and mobilizing resources to recover from COVID in line with the 2030 agenda is certainly an urgent task but our estimates show that LDCs and LLDCs alone would need to mobilize about 19% for LDCs and 8% for LLDCs of their GDP every year to attain the SDGs so that's clearly out of reach and and the financing needs for for small island developing states are asked will certainly be much higher given their small scattered population basis now despite the ongoing discussions about innovative financing I do believe that three traditional sources will continue to dominate the financing landscape in vulnerable countries and these are tax revenues FDI and ODA I mean let me turn to tax revenues these have been particularly limited and volatile in in several vulnerable countries because of their narrow and undis-diversified revenue bases but many countries do face a huge untapped potential to increase revenue especially tax revenue and we've estimated for some of these countries that these untapped revenues could be up to 12% of GDP now in light of the ongoing pandemic and the informal nature of many vulnerable countries one feasible avenue to unlock revenues would of course be to improve tax administrations particularly by increasing collection efficiency from existing taxpayers and also minimizing leakages let me turn to FDI FDI is also an important source of financing but we've seen that it's volatile it's been certainly volatile over the last few years and it's actually been trending lower since 2017 and at the same time countries that have been able to attract FDI tend to have either extractive sectors or and or low cost labor sectors and as a result of this I think relying on FDI as a vehicle for a sustainable recovery will be difficult for vulnerable countries thirdly ODA I mean ODA remains the single most important source of external finance for many countries in special situations while multilateral donors are stepping up their lending and grant support in the wake of the pandemic the impact on bilateral ODA and its outlook is still unraveling and and I think there's certainly in many countries a room for improving the more efficient use and maybe equitable use of ODA and how to channel it better towards efforts to achieve the SDGs so so more work can be done there there are a number of emerging opportunities in the rapidly expanding global market for thematic bonds such as green bonds social bonds sustainability bonds the expansion of the green bond market has been particularly noticeable and I think the value of green bond issuance in the Asia-Pacific region increased around 10 fold between 2015 and 2020 a number of countries Fiji Kazakhstan Uzbekistan have been benefiting from this trend but this is certainly not an option for all as we've also heard from from some previous speakers not only owing to regulatory and technical capacity gaps but also concerns over debt sustainability of the currently in our region 11 of the 37 countries in special situations are considered to be at a high risk of public debt distress and eight of these are small island developing states maybe let me conclude by emphasizing that we do think that regional cooperation plays an important part in mobilizing resources to support the vulnerable countries and we've we've been trying to collaborate through a number of issues and initiatives with these countries escap has been collaborating with the Pacific Islands forum secretariat to to look at some strategies for debt relief such as debt for climate swaps which can be a mechanism to simultaneously reduce debt exposure and increase investments in climate mitigation or adaptation we recently worked with the United Nations country team to assist the government in Bhutan in building the necessary infrastructure for a bond market and this actually resulted in the government issuing its first sovereign bond in 2020 to meet its financing needs we're establishing a regional network on infrastructure financing and PPPs with with the idea to to provide a platform for policymakers and experts to to discuss the opportunities and gaps and also to advocate the establishment and harmonization of legal and regulatory frameworks for PPPs I think that's certainly something that that we need to have to be able to tap the private sector more to contribute to to reaching the SDGs and then I just mentioned the private sector there's a long established a sustainable business network where I think you know the aim is to promote the mobilization of resources by not only facilitating engagement among governments but as I mentioned the private sector and other stakeholders because there's certainly a lot of I think as we've heard there is a lot of money out there there is a lot of financial resources available they're just not there where they should be so we need to think a little bit more creatively about how can we get to get it there to where it's needed most I'll end by intervention there thank you very much thanks for your time and it was a pleasure joining this panel thank you very much oliver for sharing those views uh extremely uh useful and relevant uh for for seeds and LDCs in particular so thank you for your presence today I'll move on immediately by inviting Mr Jean-Baptiste Jacouton uh Jean-Baptiste his research officer on sustainable finance and at the Agence Française de développement AFD his work concentrates on the role and challenges of public development banks in SDG financing so you'll be shared with us insight on his research in dystopia so the floor is yours Mr Jacouton thank you moderator and many thanks to the hosting governments and organizations for the opportunity so the story I want to share with you today is that of a group of actors which has been long overlooked within the global financial architecture and which is now experiencing a worldwide renaissance there are 500 financial institutions worldwide accounting for more than 10% of annual global investments they have public mandates and most importantly they have the capacity to leverage private financing in favor of the SDGs here I'm referring to public development banks which have gathered into a global coalition called finance in common it is not only about multilateral development banks that professor Jeffrey Sachs and my co-panelists have already mentioned but also about national development banks so during my intervention I will start answering two questions the first one is what does it mean to be a public development bank in a small island developing state both in terms of general characteristics and in terms of SDG alignment and here I will derive many insights from the database that we have built at the French Development Agency with our partners at Peking University and the second question relates to public development banks main challenges to leverage finance in favor of the SDGs so next slide please I don't know yes I had slides so I don't know if you can put them on screen thank you so when looking at the ecosystem we've served that small island developing states have quite a long history with public development banks and in fact as early as 1936 Mauritius created its own bank and today we identified 31 public development banks located in the small island developing states and as you can see most of them are national institutions and we observe that two-third of the small island developing states have at least one public development bank so on average these institutions have 130 million US dollar in total assets and even though in absolute terms this is rather small these institutions have in fact an important weight in the respective economies the balance sheet is on average 10 percent of the national GDP but in some countries this even reaches 20 percent of the GDP so therefore these institutions have the capacity to intervene massively in their respective economies and what is also very interesting is that even though they do not seek to maximize the profits these institutions do have a positive net income of 2.3 million US dollar on average now regarding the mandates public development banks play a backbone role in financing small island developing states economies most of them serve a wide and diverse population drawing from all layers in society they promote growth SMEs industrial development regional integration rural development so on and so forth but once we recognize this one may ask what is public development banks relationship with the sustainable development goals and here I want to stress a major difficulty that we encounter when analyzing public development banks contribution to the STGs most of them publish annual activity reports unfortunately these banks do not report under alignment with the 2030 agenda in the same way and the lack of common methodology prevents the aggregation of data on public development banks commitments and therefore we can hardly assess the progress made in closing the SDG finance gap next slide please so this is why at the French development agency we have been developing a tool over the past year called the SDG prospector that uses artificial intelligence to read public development banks annual reports in a systematic way in this fashion we're able to draw a comprehensive mapping of public development banks orientation towards the SDGs and here I really want to insist we are looking at the way public development banks showcase their own activities and what we observe in the small island developing states is that public development banks tend to favor three main SDGs the first one is on sustainable growth and decent job creation the second is no hunger which is very consistent with the fact that small island developing states import around 60% of the food and eventually public development banks in the small island developing states tend to take into account climate action more than in any other locations and of course this clearly resonates with the vulnerabilities related to climate change and the urgent need for climate adaptation solutions highlighted throughout these panels and however what is a bit more surprising but unfortunately this is the case for all public development banks in the world is that PDBs tend to pay fewer attention to biodiversity and especially life below water at least this is I mean this SDG does not appear in the in their annual reports next slide please and so now I'd like to close my intervention with a few takeaways as I have underlined public development banks already play a key role in supporting the economies however we still have difficulties in assessing the overall contribution to the SDGs therefore I would invite the governments of small island developing states to urge their public development banks to report systematically on the SDG alignment in the meantime it is necessary to reinforce public development banks capacities in these countries more than any other development actors they know what is at stake locally and they act as platforms for mainstreaming SDG financing for example at the french development agency we have granted a green credit line of 30 million euros to the caribbean development bank which aims at developing infrastructure and helping caribbean states adapt to climate risks moving forward the finance and common coalition aims at creating synergies across public development banks worldwide and it also aims at strengthening the relationships with other public and private actors such as the Glasgow financial alliance for net zero and the network for greening the financial system so finally to all public development banks in the small island developing states I want to remind that the finance and common summit 2022 will take place from the 18th to the 20th of October in Abidjan and of course they are all invited to join and to all of you I want to say thank you for your attention thank you very much Jean Matisse for sharing your insight of the role of public and multilateral development banks especially in seats extremely useful contribution to the debate today thank you again for your presence and move on with the last intervention which is a video recorded message from Mr Jean Pesnet Jean Pesnet is the global director for finance competitiveness and innovation at the word bank who has spoken a lot about the role of Bretton Wood institution and development banks so it will be very interesting to hear his views and what have been the contribution of the word bank to make a financial system more resilient and expand financial opportunities and public finance in support of sustainability or climate action and green and blue economy so my colleague from SDSN if you could launch the video that would be excellent good morning just making sure you can hear the sound frozen good evening good afternoon and you hear the sound when he speaks we can just hear a couple of words and okay super super I just wanted to make sure I will launch it now thanks good morning good evening good afternoon thank you very much for the invitation to join you for this panel I'm really sorry I was not able to join virtually and in person but I'm very happy to have the opportunity to address you by video first I would like to applaud you for this timely discussion on financing development priorities and its framing around the acute challenges faced by small island states the time for action is now we are living in a time of overlapping crises which are making the 2030 development goals an even steeper challenge for the climate crisis alone the OCD has estimated that we need to invest 4.2 trillion to achieve the low carbon transition and tackle the climate crisis in emerging market and developing economies 4.2 trillions this estimate was even before the 2022 food and energy security crisis development finance alone is not enough for the last three fiscal years the world bank has lent around 100 million annually this is a tiny fraction of what is needed so we must attract private capital to fund development priorities at all level by developing markets through investment fund and financing projects yet today only 5% of global investment assets are located in emerging markets so how can we do that in my part of the world bank group finance company and innovation we are working with governments to develop markets through adoption of international standards for sustainable financial system with partners such as the international sustainability standard while being clients such as Konomi and Bangladesh achieve greater consistency and compatibility of sustainable taxonomies ESG rating and climate and sustainability reporting this is crucial for ensuring that countries companies and projects which need financing most are not excluding for sustainable finance we are helping countries like Indonesia and Jamaica manage risk with disaster risk finance and stress testing work with banking sector regulators through our toolkit for policymakers to greening the financial system we are working in over 50 countries to develop domestic capital markets which align with international standards and thereby can attract a diverse set of investors at the investment fund level we need collective instrument vehicles to attract a wide range of partners here we have lessons to learn from mobilizing private capital for development more broadly for instance in Colombia in a partnership between the AFC and local development banks we were able to mobilize 1.8 billion for domestic pension fund into a road infrastructure program to investment platform were announced by our IFC colleagues last year to mobilize climate finance in this way a two billion fund with a Monday will help to mobilize up to 13 billions of private investment into sustainable and green bonds in emerging market another example is a world world bank group and donor partnership with your expansion fund which has resulted in 1 billion invested in regional and South Africa infrastructure equity funds we are working to expand this kind of coordination platform to include European institution investors as well when key element to this support is linking global investors with their local counterpart to support mutual learning and sharing of risk world bank team were play as played an integral role in enabling establish a consortium of Kenyan pension funds to work together to invest in local infrastructure and development projects finally at the project level we use the sustainable development for our own insurance to signal that climate and sustainability concern are integrated across our work regardless of sectors region or countries since launching the world's first green bond in 2008 the world bank has issued approximately 16 billion worth of 185 green bonds in 23 currencies in 2018 the world bank helped fund the global bond blue bond market to support ocean based sustainability projects we also work with clients who bring more emerging market sovereign into this growing market Egypt is one example at the same time we see other promise promising instruments getting ground including sustainability link loans and bonds which pay out according to the achievement of key performance indicators she did was the first sovereign to issue one of these bonds earlier this year the recent issuance by world bank treasury of the wide life conservation bond supporting the rhino population in South Africa has received much attention as a model which could be adapted to SDGs to summarize under the world bank climate change action plan we are moving beyond green project to greening entire economies this type of connection collective action and partnership approach is the only way to meet developing country needs and the broader SDG role thank you very much including for the opportunity to join you today through this intervention and I wish you the best for your proceeding thank you so with intervention from Mr Jean-Pierre who I thank for for his time and his contribution we end this second panel we've heard a lot about challenges but also the various recommendations and a solution that have been made by all panelists to increase financing for SDGs and many calls for action as well and many calls for changes so we certainly take this as takeaways for the global debate in the UN and with our SDSM colleagues all question and answers that have been put in the boxes will be passed on to the virus panelists as well and we make our best efforts to make sure that you receive an answer so with that I hand over the floor to Simone and Isabella over to you please thanks yeah so we have a run out time so we have already heard those also the closing remarks by ambassador Samoa ambassador Fatuma Navar so to close this event I just would like on the behalf of SDSN and also of the UN resident coordinators a big thank to all the panelists for the very thoughtful and challenging presentations we have heard in the latest video from Mr Pesme from the World Bank that the time for action is now I think that all presentations have provided great inputs to move forward on the development agenda so let's continue the discussion on all the important topics on the importance of achieving a good measurement of the SDG financing gap not only in seats but in all of our countries let's think further about the targeted financing mechanisms that can be developed to fill in the gap and also on the importance of developing a good multi-dimensional vulnerability index that can be used for changing the allocation criteria of concessional finance so thank you again to all the panelists and I hope to see all of you very soon in other challenging discussions thank you again everyone and thank you also to my colleague Didier for moderating panel two thanks a lot bye everyone