In 2015, the world agreed on an ambitious 15-year plan - the 2030 Agenda for Sustainable Development - to end poverty by 2030. The 17 Sustainable Development Goals (SDGs) are at the heart of this plan. They offer a blueprint to help us end poverty, spur economic growth, and tackle the climate crisis.
We are now at the halfway point of this 15-year plan - a critical moment to assess progress and recalibrate strategies. And there is no better place for global leaders to do this than at the United Nation's General Assembly (UNGA) this month.
We're off track to meet our goals
Actually achieving the SDGs remains a distant aspiration due to a severe lack of funding. This is in large part due to high income countries' failure to meet their commitment to spend 0.7% of gross national income (GNI) on aid. But it is also because our global systems of taxation, debt, and international public finance were not set up to address the challenges of today. The estimated financing gap to achieve the SDGs is a staggering $3.9 trillion per year and growing. It’s clear that the status quo isn’t working.
The only way to close the funding gap is to completely reform our global financial system to make it fit-for-purpose. This transformation requires major reforms to systems of taxation, debt, and international public finance to shift both power and resources to lower income countries.
The UK is in a strong position to act
The UK is in a uniquely strong position to be a leader in championing this reform agenda. With the City of London long serving as a global financial epicenter, the UK has unique power and influence over how money flows around the world. As a major stakeholder in the World Bank, the UK holds the power to foster significant changes to how multilateral development banks operate. Moreover, as around half of international private debt contracts are governed by English Law, the UK has the opportunity to make systemic changes to the global debt system.
We can’t shape the future from the sidelines
Despite the weight of the moment we're in, Rishi Sunak is planning on becoming the first prime minister in decades to skip the UN General Assembly. Combined with his absence from the Global Summit for a New Financing Pact in Paris in June, this decision fuels worries that the absence of UK global leadership at the highest level is becoming the default.The UK aims to be a global leader, but you can't shape the future if you're not in the room.
Our call to action
It is crucial we act now - one in three children around the world (774 million) live in both poverty and high climate risk. The climate crisis is already having devastating impacts on children's lives. It disrupts access to education and healthcare, reduces food security, and destroys livelihoods - trapping millions in a vicious cycle of poverty.
We urge Rishi Sunak to join other heads of state at UNGA later this month and support key reforms on the agenda, including progress towards a UN Tax Convention. This would make global rule-making on tax more inclusive, transparent, and democratic. The SDG Summit at UNGA also offers an opportunity for the UK to support many of the reforms outlined in the UN’s Common Agenda Policy Brief 6: Reforms to the International Financial Architecture, which can unlock critical funding for the SDGs.
Meanwhile, the UK can also contribute to this agenda by implementing the following reforms at home:
1. Advancing legislative options to support private creditors to participate in debt relief. More than half of lower income countries are in or at high risk of debt distress and a significant amount of this debt is held by private creditors. In fact, between 2022-2028 42% of external debt payments by L/LMICs will be paid to private creditors. However, past experience has shown that private creditors only take part in debt relief processes after legislation is introduced. To find lasting solutions to the issues around private creditor held debt in lower income countries, the UK should review and consult on legislative options to compel or incentivise private creditors to participate in debt relief. This is in line with the International Development Committee recommendations and follows the lead of the New York Senate.
2. Matching Japan and France’s commitment to recycle 40% of special drawing rights (SDRs). SDRs are an important financial asset issued by the International Monetary Fund (IMF) to every country around the world. However, they are allocated according to IMF quota shares rather than need. This meant that the entire continent of Africa received only 5% of the recent SDR allocation in 2021. The UK pledged to ‘recycle’ 20% of their SDR allocation to lower income countries. This pledge is welcome, but it falls short of pledges made by Australia (39%), China (34%), France (40%) and Japan (40%).
3. Stop using the UK’s international development budget to pay refugee costs in the UK. The UK should return to spending 0.7% of GNI on aid and, in the meantime, stop raiding the aid budget for refugee hosting costs within the UK. The UK spent around a third of its budget (£3.7 billion) on costs for hosting refugees and asylum seekers in the UK in 2022. It is right that the UK hosts refugees and asylum seekers in need. However, it is not right that the cost burden comes at the expense of communities in lower income countries. The UK is the only G7 country funding the costs of hosting Ukrainian refugees from their existing aid budget.
Turning rhetoric to action
There is no excuse for skipping important global events like UNGA given the scale of global challenges facing the world today. These are the moments where the UK can shape conversations, drive forward key reforms, and show leadership and solidarity. The UK must turn rhetoric into action by taking on a leadership role on the global stage and by progressing crucial reforms at home.
