29 March 2018: The co-facilitators for negotiations on the conclusions and recommendations of the 2018 Financing for Development (FfD) Forum circulated a revised zero draft for consideration by UN Member States, during the ongoing consultation process. Courtenay Rattray, Permanent Representative of Jamaica, and Francisco Duarte Lopes, Permanent Representative of Portugal, based the text’s revisions on comments provided by governments at informal consultations that started on 2 March 2018.

The 2018 FfD Forum will take place from 23-26 April, in New York, US. The Forum issues intergovernmentally agreed conclusions and recommendations, which are fed into the overall follow-up and review of the implementation of the 2030 Agenda for Sustainable Development at the yearly sessions of the UN High-level Political Forum on Sustainable Development (HLPF). The 2018 HLPF will take place from 9-18 July, in New York, US.

By the text, Member States would commit to taking four key actions in support of the implementation of the Addis Agenda Action Agenda on FfD (AAAA): facilitate the use of all sources of financing at all levels, while being mindful of fiscal and debt sustainability; work to align incentives of both public and private actors with long-term sustainable development; operationalize national financial frameworks into investable projects and pipelines; and take into account that every State has and shall “freely exercise full permanent sovereignty” over all its wealth, natural resources and economic activity.

The revised zero draft notes that governments will hold open, inclusive and transparent discussions on the modernization of the official development assistance (ODA) measurement and on the proposed measure of “total official support for sustainable development” (TOSSD), affirming that any such measure will not dilute commitments already made. They welcome that ODA for scientific, technological and innovative capacity has increased significantly, but “note with concern” that it has not sufficiently benefited the poorest and most vulnerable countries. Member States further request the UN’s Inter-agency Task Force on FfD (IATF), as part of its 2019 report, to discuss climate and disaster resilience in development financing, recalling the need for transparent methodologies for reporting climate finance, and welcoming the ongoing work of the UN Framework Convention on Climate Change (UNFCCC) to that end.

The text invites the IATF to examine the implications of fintech and the “weightless economy” on financial inclusion, access to finance and financial regulation.

Through the revised text, governments reiterate their call to work towards a global consensus on guidelines for debtor and creditor responsibilities in borrowing by and lending to sovereigns, building on existing initiatives. They request the IATF, as part of its 2019 report, to study complementarities and incongruities of such initiatives, as well as to advance the analysis of state-contingent debt instruments, gross domestic products (GDP)-linked bonds, insurance coverage and other innovative mechanisms, as a means of reducing risks to sovereign balance sheets, particularly in small island developing States (SIDS), the least developed countries (LDCs), land-locked developing countries (LLDCs) and open economies more vulnerable to disasters.

Member States also note that they are “mindful” of new gaps that may result from financial innovations, including digital finance, and invite the IATF to examine the implications of fintech and the “weightless economy” on financial inclusion, access to finance and financial regulation. While taking note of a growing number of successful regional sovereign risk insurance facilities, the revised zero draft underscores that global risk management would offer more efficient risk diversification, sustainability and efficiency. Governments further call on development cooperation providers to support countries that are not able to afford participation in these mechanisms.

By the text, Member States decide that the 2019 FfD Forum will convene from 15-18 April 2019, in New York, US, as well as that in the outcome document of the 2019 FfD Forum they will consider the need to hold a follow-up conference.

The next informal consultation on the revised zero draft will take place on 5 April 2018, in New York, US. [Revised Zero Draft] [FfD Forum Website] [Draft Programme FfD Forum]