New dashboard to track SDG investments
Achieving a goal requires dedicating adequate resources. ESCAP’s SDG Progress Assessment shows that countries in Asia and the Pacific are not on track to achieve any of the 17 Sustainable Development Goals (SDGs) by the year 2030. But do we know how much these countries are investing in SDG-related priorities? There has been surprisingly little analysis done on this front. So to stimulate further work, ESCAP has just released the SDG Investment Trends dashboard on the SDG Gateway, a regional platform for data and analysis on the SDGs.
The dashboard shows investment trends across six broad areas: no poverty and hunger (Goals 1 and 2); health and education (Goals 3 and 4); housing, water and sanitation (Goals 6 and 11); clean energy and sustainable infrastructure (Goals 7 and 9); environment and climate (Goals 12 to 15); and gender, justice and statistics (Goals 5, 16 and 17). Where data is readily available, both public and private investment flows are captured. For instance, in health, out-of-pocket health expenditures are shown along with government health expenditures. Similarly, water, sanitation and hygiene (WASH) expenditures are broken down by source of funding: government, households, repayable finance, and external finance.
Challenges and innovative examples
Clearly there are many limitations to precisely estimating SDG-related investments. (Note that the term “investment” is understood to include expenditures that deliver clear social returns.) To begin with, there is no agreed classification of what constitutes an expenditure or investment towards the SDGs. There are data availability challenges as well. For instance, many countries are still working towards reliable accounting systems to enable them to track public expenditures on specific programmes or policy objectives in a detailed way.
Nevertheless, several Asia-Pacific countries have begun to track their SDG-related investments. For instance, in Indonesia, climate budget tagging reveals that climate change mitigation and adaptation (Goal 13) investments increased from 3.6 per cent to 4.9 per cent of the government budget over the period 2016-2018. In the Philippines, climate change investments are further categorized by the priorities of the National Climate Change Action Plan, such as food security, water sufficiency, environmental and ecological stability, climate smart industrial services, and sustainable energy. Another approach to tracking SDG-related investments is to simply map the Goals with the existing functional classification of the national budget. Nepal has adopted such an approach for several years now.
Current investments are not adequate
How do current investments compare to the total investment requirement to achieve the SDGs? Globally, a recent UNCTAD study found that current public and private investment flows fall short of the total investment needs for achieving the SDGs, albeit with some variations across sectors. Globally, investment has been increasing in recent years in food and agriculture, health, telecommunications, transport infrastructure, climate change mitigation, and biodiversity, but stagnant in power and climate change adaption and declining in education and WASH.
Similarly, a recent Brookings study estimated that governments around the world were already spending $21 trillion per year on SDG-related sectors in 2015. However, most of this took place in high-income countries, where per capita SDG spending was $12,753, relative to only $115 in low income countries, $267 in lower-middle income countries and $2,220 in upper-middle income countries. While this reflects differences in income levels, per capita SDG public investment is below the estimated minimum requirement in low income countries and lower-middle income countries.
In the Asia-Pacific region, ESCAP’s Economic and Social Survey 2019: Ambitions Beyond Growth estimated additional investment needs of $1.5 trillion per year for achieving the SDGs. Although this was equivalent to about 5 per cent of the region’s GDP in 2018, additional investment needs were significantly higher at about 20 per cent of GDP for the region’s least developed countries.
COVID-19 and the Decade of Action
As we embark on the Decade of Action to deliver the Global Goals, there are many challenges. The COVID-19 pandemic poses a severe threat to people’s health and livelihoods. Public health systems are coming under intense pressure and millions are falling back into extreme poverty and hunger. The situation is particularly worrisome in least developed countries.
To mitigate the adverse impacts, Asia-Pacific countries have deployed a range of containment measures and fiscal, monetary and trade policy measures, as highlighted in ESCAP’s COVID-19 Policy Response Tracker. While attending to the immediate needs, countries can also ensure an inclusive and sustainable recovery by aligning the economic support measures with the SDGs. Indeed, there was a felt need to mainstream the SDGs into economic policymaking even before the COVID-19 shock, but it is now more important than ever as countries seek to build back better. Doing so will require not only channeling adequate resources toward SDG-related priorities but also a change in mindset and the collective action of all stakeholders, including businesses and consumers, as highlighted in ESCAP’s Economic and Social Survey 2020: Towards sustainable economies. It’s time to put our words into action!