Investment Needs to Achieve the Sustainable Development Goals Understanding the Billions and Trillions

In September 2015, governments adopted the Sustainable Development Goals (SDGs) to guide international cooperation in pursuit of ambitious quantitative goals to be achieved by 2030. This paper reviews the role that global needs assessments play in supporting the SDGs and discusses common criticisms. The paper proposes an analytical framework for SDG needs assessments that translates the 17 SDGs into eleven investment areas. It also integrates investment needs for climate change adaptation and mitigation with the development needs for each investment area. Using this framework, published sector needs assessments are harmonized and consolidated, paying careful attention to differences in methodologies and assumptions. The share of private financing is estimated for each investment area, and overall investment needs are aggregated. The paper then explores the implications of economy-wide studies on synergies and trade-offs in financing the SDGs and outlines priorities and directions for future research. This preliminary analysis of available sector studies shows that incremental spending needs in low- and lower-middle-income countries may amount to at least $20131.3 trillion per year ($342 - 355 billion for low-income countries and $903 - 938 billion for lower-middle-income countries). Over the period this corresponds to some 4 percent of these countries' GDP measured in $ PPP and 11 percent of GDP in international dollars. Approximately half of these investments in the SDGs can be privately financed. Domestic resource mobilization can increase significantly leaving an external financing gap of perhaps $133 - 161 billion per year (equivalent to 0.23 percent of high-income countries' GDP) that must be met through international public finance, including Official Development Assistance. Globally an incremental 1.3 - 2.0 percent of world GDP needs to be invested each year by the public and private sectors to achieve the SDGs in every country. These results are preliminary and meant for discussion and improvement.