by Xinhua writers Wang Jiangang, Mao Lei
UNITED NATIONS, April 6 (Xinhua) -- A UN official on Wednesday called for immediate action on sustainable development financing.
"The developing countries need to have access to finance that they can use both to invest in the sustainable development goals (SDGs) and to deal with the immediate challenges, including to support their citizens in the face of the cost of living crisis," said Navid Hanif, assistant secretary-general in the UN's Department of Economic and Social Affairs and the acting director of the Financing for Sustainable Development Office.
In an exclusive interview with Xinhua shortly after the launch of the 2023 Financing for Sustainable Development Report: Financing Sustainable Transformations, Hanif discussed the urgent need for sustainable development financing to address a range of pressing global challenges, from debt distress to climate change.
Hanif argued that an enhanced international financial architecture can better support sustainable development in order to address these challenges.
He pointed to the SDG Stimulus launched by the UN Secretary-General Antonio Guterres, which has three parts, including addressing rising risk of debt distress, increasing concessional finance to countries, including by changing the ways multilateral development banks work, and increasing liquidity for countries in need, which is an immediate concern.
"Countries are struggling. So, there should be contingency financing available whenever they need and for any shocks that they are confronted with," he added.
Furthermore, Hanif stressed the need for long-term solutions, including the automatic issuance of Special Drawing Rights (SDRs), which would enable countries to better handle shocks.
"This should be part of the efforts to strengthen the financial architecture. This would become more effective, as the SDRs would be automatically available whenever that countries are struggling to deal with shocks," he noted.
In addition to these immediate and long-term solutions, Hanif discussed ongoing efforts to reform the international financial architecture.
He cited the example of the G20's work on a capital adequacy framework for multilateral development banks, which has led to the World Bank developing an evolution roadmap to focus not only on eradicating absolute poverty and promoting shared prosperity, but also addressing climate change and global public goods like health.
Hanif also called for revisiting global economic governance to reflect the current economic realities.
During the interview, he stressed the need for political commitment and public funding to ensure that climate finance keeps pace with the effects of climate change.
Hanif called for long-term loans and low interest rates to help countries deal with adaptation, which is a challenge that developing countries are facing on a daily basis.
In this regard, he said that "there are some estimates that indicate 4 trillion U.S. dollars may be needed... What we are getting is maybe just one-tenth of that. So, there is a huge gap there."
Speaking about the role of public and private investment in achieving sustainable development goals, Hanif emphasized the need to create enabling environments and better measurement tools to encourage private investment that is aligned with the SDGs.
He highlighted the potential of technology to promote sustainable development, particularly in the areas of energy transition and financial inclusion.
Even though sustainable development financing is faced with many challenges, Hanif emphasized the need for international collaboration and solidarity.
"There is no option... We have no option, but to collaborate," he stated.
He also called for immediate measures to address debt distress and ongoing efforts to redesign the debt architecture to better meet the needs of developing countries.
"Both immediate measures as well as long-term thinking are needed to redesign the debt architecture to enable the system to deal with the new creditor landscape," he noted. ■
