Kicking off a process that, in 2025, will culminate in the Fourth International Conference on Financing for Development (FfD4), the intergovernmental Preparatory Committee (PrepComm) for FfD4 focused on bridging gaps in SDG financing and on delivering international financial architecture reform.

According to a UN press release, finance and foreign ministers, along with global experts, came together in Addis Ababa, Ethiopia, from 22-26 July 2024, “to call for radical action to reform the international financial architecture, empower developing countries in international institutions and channel trillions of dollars towards sustainable development in Africa and other developing countries.”

Noting that the SDG financing gap for developing countries has reached USD 4 trillion annually due to global shocks such as the COVID-19 pandemic, geopolitical conflicts, and economic instability, the release highlights that debt challenges have led to increases in poverty and inequality, putting the SDGs at risk. These challenges, it points out, “have laid bare structural flaws in the international financial architecture.”

In his message to the first session of the PrepComm, UN Secretary-General António Guterres highlighted FfD4 as “a unique opportunity to reform an international financial system that is outdated, dysfunctional and unfair.” “It opens the door for world leaders to adopt ambitious reforms to deliver affordable long-term financing at scale – and deliver the SDG Stimulus,” he said.

Underscoring the need to create an international financial architecture that can overcome global financial divisions, Deputy Secretary-General Amina Mohammed outlined six areas for action:

• Tackling the debt and development crisis;
• Enhancing access to long-term, affordable financing to enable bold investments across key transitions;
• Closing gaps in the global financial safety net so that all countries are protected in times of crisis;
• Establishing a fair and effective international tax system to allow countries to mobilize more resources domestically and to combat illicit financial flows;
• Harnessing the trillions of dollars in the international capital markets; and
• Reforming global economic governance to make the international financial architecture more inclusive and just.

During the meeting, participants made proposals for reforming the rules and governance of international taxation, and for addressing the debt crisis, including through “new international mechanisms to resolve situations of sovereign debt default.”

Mandated to support reform of the international financial architecture, FfD4 will convene in Spain, from 30 June to 3 July 2025. The PrepComm was established by UN General Assembly (UNGA) resolution 78/271, to make the organizational, procedural, and substantive preparations for the Conference. PrepComm will meet again in New York, US, in December and in Mexico City, Mexico, in February 2025. An intersessional multi-stakeholder hearing is planned to be held in New York, in October 2025.

In a letter dated 26 July 2024, the co-facilitators for the FfD4 outcome document issued a call for inputs for an elements paper, “which will put forward potential elements of the Outcome Document of the Conference, with a focus on substantive recommendations rather than specific language.” Inputs from Member States, in their national capacity and as groups, and from other stakeholders can be submitted until 15 October 2024. [First Session of FfD4 PrepComm] [UN News Story]