ODA Topics 6
Leading Group on Innovative Financing for Development
Japan’s initiatives in 2019 as Presidency
Foreign Minister Motegi delivering a statement at the Meeting of the Leading Group on Innovative Financing for Development (September 2019)
In its World Investment Report 2014, the United Nations Conference on Trade and Development (UNCTAD) pointed out that developing countries face an annual funding shortfall of some U.S. $2.5 trillion in order to achieve the Sustainable Development Goals (SDGs) by 2030. Therefore, based on the recognition that funding through ODA from developed countries alone—which had been the conventional source of funding—is no longer sufficient, countries around the world are advancing efforts to review and promote various financing mechanisms that include the mobilization of private funds.
Accordingly, the Leading Group on Innovative Financing for Development was established in 2006 with the purpose of stimulating international discussions on innovative financing, and to promote further mobilization of private resources. Members of the group comprise 63 developed and developing countries including Japan, as well as international organizations including the United Nations.
In January 2019, Japan succeeded Georgia by assuming the Presidency of the group. The G20 Osaka Leaders’ Declaration, which is the outcome document of the G20 Osaka Summit held in June 2019, clearly stated that the mechanism of innovative financing, including blended finance,* plays an important role in promoting joint efforts with the G20 countries. Furthermore, Prime Minister Abe announced that Japan will lead international discussions on this theme.
Moreover, taking the opportunity of the UN General Assembly held in September the same year, Japan chaired a Meeting of the Leading Group on Innovative Financing for Development in New York as the Presidency. This meeting was attended by Foreign Minister Motegi, representatives from the United Nations and other international organizations as well as participating countries. In his opening remarks at the meeting, Minister Motegi presented that under Japanese presidency of the G20, the G20 leaders reaffirmed the important role of innovative financing to achieve the SDGs in the G20 Osaka Leaders’ Declaration, and expressed the need to increase the momentum toward further promotion of innovative financing by sharing the practices of each country in order to fill an annual funding gap necessary to achieve the SDGs.
Japan will continue to demonstrate its leadership in the international community with a view to expanding innovative financing.
* An approach of contributing to development projects by combining various forms of financing in addition to public funds, such as commercial funds and funds from philanthropic foundations.