SDG 2024: Developing Nations Confront Severe Economic Prospects

The Department of Economic and Social Affairs, a branch of the United Nations (UN), has reported that developing countries are currently facing the most challenging medium-term economic outlook in decades. According to the Sustainable Development Goals Report 2024, these countries are experiencing a significant gap in investment needed to meet the Sustainable Development Goals (SDGs), amounting to USD 4 trillion annually.

In a press conference before the G20 summit last September, India’s Sherpa Amitabh Kant emphasized the importance of securing sustainable development goals. India has been advocating for new financial instruments to support these goals.

The SDGs investment gap refers to the shortfall in funding required to achieve the targets outlined in the 2030 Agenda.

“Per capita growth in gross domestic product (GDP) in half the world’s most vulnerable countries is now slower than in advanced economies for the first time this century. This trajectory threatens to reverse a long-term trend towards more income equality among countries. Furthermore, after a decade of rapid debt accumulation, the external debt stock in low- and middle-income countries remains at unprecedentedly high levels,” the Sustainable Development Goals Report-2024 stated.

“The SDG investment gap in developing countries now stands at USD 4 trillion per year. These problems are exacerbated by the fact that developing countries are inadequately represented in global economic decision-making, with their voting share falling far short of their membership in many international financial institutions,” It further added.

According to the 2024 Financing for Sustainable Development Report (FSDR), developing countries are facing an annual funding shortfall of USD 2.5 trillion. The report indicates that despite renewed commitments, progress towards sustainable development goals has stalled or regressed on multiple fronts. The lingering effects of COVID-19, compounded by conflicts, climate-related crises, and economic instability, have exacerbated existing inequalities. In 2022, an additional 23 million people fell into extreme poverty compared to 2019, with over 100 million more experiencing food insecurity.

The report underscores that funding to achieve SDGs is particularly inadequate in low- and lower-middle-income countries, where only 35 percent have sufficient financial resources, contrasting sharply with 11 percent in high-income countries. It also highlights that half of the 45 countries or regions receiving donor funding are in low- and lower-middle-income categories.