Workshop on Supporting the Least Developed Countries (LDC) in Asia-Pacific in meeting the challenge of resource mobilization for achieving the 2030 Agenda for Sustainable Development
Financing needs in the least developed countries (LDCs) are disproportionately large relative to the size of their economies. To tackle these needs, the 12 LDCs1of the Asia-Pacific region require greater domestic resource mobilization, complemented by strong international support, to improve tax and other revenue collection. Countries also need to identify additional and innovative financing sources, as well as develop their financial markets in an efficient, fair and predictable manner.
These challenges have been highlighted by the global community through the 2030 Agenda and the Addis Ababa Action Agenda of the Third International Conference on Financing for Development (AAAA). The United Nations has already embarked on a plan of action to support the development challenges faced by LDCs, namely the Istanbul Programme of Action for LDCs (IPoA, 2011-2020). Relevant policy issues for LDCs have also been highlighted in ESCAP’s Regional road map for implementing the 2030 Agenda for Sustainable Development in Asia and the Pacific. ESCAP, as a United Nations Regional Commission, is critically placed to assist LDCs in the region in this subject due to its role as an intermediary in implementing the internationally agreed global and regional policy agendas at the country level in support of the United Nations country teams.
According to ESCAP research and analysis, the region’s financing requirements are tremendous. For the LDCs in Asia and the Pacific, it may cost up to $37.6 billion per year (12.6% of GDP) to provide for their infrastructure investment needs. Furthermore, the focus of the 2030 Agenda for Sustainable Development on social and environmental objectives highlights new dimensions and challenges for mobilization of financial resources by developing countries, especially the LDCs. ESCAP member States are in the process of identifying practical ways to use existing resources effectively and to raise additional resources for the pursuit of the sustainable development goals.
To narrow development gaps, the Asia-Pacific region also requires a financial system that is efficient, fair and predictable. It is important to recognize that a key constraint to realizing these opportunities is the lack of strong financial intermediation mechanisms to bridge long-term financing sources and sustainable development-oriented investments. The LDCs have very limited resources to address their development challenges. They also face limited capacities to attract new investments. While this is due to an absence of well-functioning financial systems and weak governance and institutional structures, the fact that there exist high protectionist sentiments in some developed countries also contributes to the private sector and other finance providers not currently being upbeat in making long-term investments for sustainable development.