High-level side event at the 2017 ECOSOC Financing for Development Forum: Investing in infrastructure for an inclusive and sustainable future of the Asia-Pacific LDCs, LLDCs and SIDS

24 May 2017
New York, United States of America

High-level Side Event "Investing in infrastructure for an inclusive and sustainable future of the Asia-Pacific LDCs, LLDCs and SIDS"
24 May 2017 (Wednesday 13:15 – 14:30)
Conference Room B, United Nations, New York

Background
A focused and workable framework for financing for development, as articulated in the Addis Ababa Action Agenda (AAAA) adopted at the Third International Conference on Financing for Development in 2015, is an integral part and a key means of implementation of the 2030 Agenda for Sustainable Development. The AAAA also requests Regional Commissions to mobilize their expertise and existing mechanisms and work in collaboration with regional banks and organizations for effective development financing in Asia and the Pacific, with focus on thematic aspects of the AAAA (para 130). The Economic and Social Commission for Asia and the Pacific (ESCAP) has been supporting member States by producing analytical reports and holding high-level consultative dialogues.

The Asia-Pacific least developed countries (LDCs), landlocked developing countries (LLDCs) and small island developing States (SIDS), collectively referred to as Countries with Special Needs (CSN), continue to face significant challenges and constraints in achieving inclusive growth and sustainable development. Such challenges and constraints are associated with remoteness, geographic features, availability of resources, demography, weather or, most commonly, a combination of these factors. The result has been limited progress in structural transformation, slower development of productive capacities and heightened vulnerability to external shocks, such as those arising from volatile commodity prices, climate change and natural disasters.

While each of these economies faces its own unique circumstances, one thing they share in common is a significant deficit in physical infrastructure, such as transport, energy, information and communications technology (ICT), and water supply and sanitation (WSS). In many of these economies, particularly in the least developed ones, access to basic infrastructure services is still far from universal: in Afghanistan, Solomon Islands and Cambodia, more than 70 per cent of rural population does not have access to improved water sources and more than half of the population is lacking access to electricity. A lack of physical infrastructure is the principle obstacle to sustainable development as not only does it limit the opportunities to expand productive capacities and improve connectivity across and among countries, thereby impeding economic growth, but also constrains social development and harms environmental sustainability.

The purpose of this high-level side event is to identify instruments, means and policies aimed at closing existing infrastructure gaps and keeping up with the growing demand for new infrastructure in CSN. ESCAP recently estimated that to do so, CSN would need to invest an average of 10.5 per cent of GDP per annum in infrastructure development and maintenance, taking into account the population growth, the increasing urbanization and the impact of climate change. As such investments far exceed current levels of infrastructure funding, the high-level side event will focus on the importance of the prioritization and sequencing of infrastructure development based on where the impact of additional infrastructure on sustainable development outcomes may be the largest. Policymakers in CSN will find this side event useful when designing and adapting national strategies for infrastructure development, just as development partners can use it to re-align their cooperation strategies with the priorities of countries of their activities.

To facilitate the discussion, ESCAP will present the findings of a flagship publication, the Asia-Pacific Countries with Special Needs Development Report 2017: Investing in infrastructure for an inclusive and sustainable future, which is devoted to this topic. This report demonstrates that the overall state of physical infrastructure is poor in many CSN. To capture the multidimensional character of infrastructure, the report presents the ESCAP Access to Physical Infrastructure Index. This index, which can also be used as tool for development policies in support of sustainable development, demonstrates clearly that significant gaps remain in physical infrastructure relative to other developing and developed countries in the Asia-Pacific region. The publication also emphases the importance of new sources of long-term financing through new global and regional initiatives, including climate finance and, in the long-run, through development of capital markets to effectively match maturities of domestic savings with long-tenor infrastructure assets. It notes however that not all countries are placed to benefit from new initiatives or have potential to develop their own capital markets, depending largely upon exogenous factors such as geographic locations and the size of their economies or population.

Objectives
The objective of the high-level side event on “Investing in infrastructure for an inclusive and sustainable future of the Asia-Pacific LDCs, LLDCs and SIDS” is to share key findings and policy issues of the Asia-Pacific Countries with Special Needs Development Report 2017: Investing in infrastructure for an inclusive and sustainable future. The discussions of this side event will further provide guidance to (1) the regional implementation of the Istanbul Programme of Action for LDCs, the Vienna Programme of Action for LLDCs and the SAMOA Pathway for SIDS and (2) the preparation of capacity building and technical assistance programmes of ESCAP for the Asia-Pacific countries with special needs.

Priority issues

• Infrastructure development and maintenance to support the implementation of the Sustainable Development Goals, particularly Goal 9 on industry, innovation and infrastructure
• Benefits of infrastructure for ensuring social inclusiveness and environmental sustainability
• Infrastructure financing and the role of development cooperation and new regional initiatives

Organization and participation
The side event will be organized as a high-level panel discussion, which will be followed by an open discussion. Dr. Shamshad Akhtar, Under-Secretary General of the United Nations and Executive Secretary of ESCAP will moderate the session. The panel will include finance ministers and experienced policy makers from the Asia-Pacific LDCs, LLDCs and SIDS, as well as senior experts from development partners, private sector representative and civil society organizations. Member States, representatives of non-governmental organizations and the private sector, and members of the media attending the ECOSOC FfD Forum are invited to attend.