UN Global report_2019

policy is key in this respect: effective tax policies can
not only generate resources for public expenditures
and investments within the regions where economic
activity takes place, but also support the reduction of
inequalities. Predictable and transparent tax rules can
also reduce illicit financial flows and increase investment
in sustainable goods and services.
Official development assistance remains vital in
many developing countries. ODA amounted to $147.2
billion in 2017, remaining flat relative to 2016, and
capping a period of steady growth over the last decade.
Five countries (Denmark, Luxembourg, Norway, Sweden
and the United Kingdom) met or exceeded the target
of 0.7 per cent of gross national income. However, on
aggregate, donors fell short of that target, reaching an
average of 0.31 per cent of GNI. International financial
cooperation continues to be significant, even as it is
changing in some ways 153 (see box 2-2)
Bilateral and multilateral providers have scaled up
blended finance. At least 23 out of the 30 members
of OECD Development Assistance Committee engage
in blended finance. Blending activities by donor
governments mobilized a total of $152.1 billion from
commercial sources between 2012 and 2017. The
activities of development finance institutions also
reflected this trend growth. In 2017, nine development
finance institutions reported that they had financed
over $8.8 billion in projects through blending. Blending
might advance some Sustainable Development Goals
more than others, as most blended deals are focused
on sectors with significant potential for economic
returns. 154
Climate finance has also seen significant growth,
even as it remains below the commitment made by
developed countries to jointly mobilize $100 billion
a year by 2020. Total climate finance flows from
developed to developing countries – including public
flows and mobilized private flows – reached $71 billion
in 2016, an increase of almost 20 per cent over 2015.
Both public and private flows increased in 2016, from
$49 billion to $56 billion and from $11 billion to $16
billion, respectively. 155156
33
Box 2-2
The continuing significance of international financial cooperation
Official development assistance (ODA) remains central to achieving the SDGs in many countries. ODA to
least developed countries increased 10.2 per cent in real terms in 2017, but the increase mainly reflected aid
for humanitarian assistance in three countries.
The 2030 Agenda has significantly broadened the set of global development priorities, and about one quarter
of bilateral ODA is now dedicated to humanitarian expenditure and in-donor refugee spending, compared
to less than one sixth in 2010. While social sectors remain the largest ODA category, social spending has
fallen as a percentage of total ODA, from 40 per cent in 2010 to 35 per cent in 2017. That reflects a shift in
donors’ focus to economic aid and support for production sectors. Assistance to economic infrastructure
and services – the second largest ODA category – has been growing in recent years, particularly in the
energy sector.
As humanitarian expenditure and in-donor refugee spending have risen, the share of ODA for country
programmable aid and budget support has decreased in recent years. In 2017, the share of ODA for country
programmable aid was 48.3 per cent (6.6 percentage points below the share in 2010), while ODA provided
as recipient-country budget support was $3.3 billion (compared to $4 billion in 2010).
South-South cooperation and triangular cooperation are continuing to expand and are making a vital
contribution to the implementation of the 2030 Agenda. A 2017 survey conducted by the Department of
Economic and Social Affairs of the United Nations found that 74 per cent of developing countries provided
some form of development cooperation, compared to only 63 per cent in 2015. However, such cooperation
complements ODA rather than replacing it; many countries reported rather modest expenditure on South-
South cooperation, with only 16 per cent of countries reporting expenditure of $1 million or more per year.
Triangular cooperation has also been increasing in scope across regions: 51 per cent in Latin America, 21 per
cent for multiregional projects, 13 per cent for projects in Africa and 11 per cent for projects in Asia-Pacific. 156
While the primary mandate of central banks is to
uphold macroeconomic policy, central banks can also
play a role in directing financial sector development,
promoting financial inclusion and aligning the financial
system with sustainable development. 157
Transformations