UN contribution to harnessing innovative finance for SDG-aligned infrastructure in Ghana
17 April 2023
UN support to enable a solid SDG-aligned financing ecosystem that would generate the needed financial impetus for infrastructure development initiatives.
In 2015, when the Sustainable Development Goals (SDGs) were adopted, 2030 seemed a distant future. Nevertheless, Member States were convinced that the Global Goals are the blueprint to achieve a better and more sustainable future for all. They repeatedly reaffirmed their commitment to act to end poverty, protect the planet, and ensure that by 2030 all people enjoy peace and prosperity. The challenge was with the huge financing needs. They consistently advocated for resources to advance the SDGs implementation, and many countries, like Ghana integrated the implementation of the SDGs into their national development plans and budgets.
A few years into its implementation, it was apparent there existed a huge SDGs financing gap. As at 2019, investments of between 5 to 7 trillion USD were needed per annum to implement the Goals globally, while 2.5 trillion USD per year was needed in developing countries alone. The Country Financing Roadmap for Ghana estimates a financing gap of around $43 billion for 2020, with a total cumulative 10-year SDG financing gap at $431.6 billion. This financing gap is estimated to have widened by the impact of the COVID-19 pandemic, the Russia-Ukraine crisis, and the general rise in prices across the world.
Filling this gap required smarter financing approaches that sought domestic, as well as international public and private investment opportunities. The ability to mobilise the needed resources from multiple sources, including domestic and international and through public, private and blended financing and investment mechanisms was thus necessary and critical to accelerate the implementation and attainment of the SDGs.
As part of efforts to support government enhance sustainable financing strategies and investments to close the financing gap for Ghana, the UN secured close to US$1m from the Joint SDGs Fund in 2020 and committed part of the funds through the efforts of the United Nations Office for Projects (UNOPS) in partnership with the government partners and other key stakeholders to contribute to critical capacity needs in nurturing innovative financing strategies for infrastructure. The interventions were to enable a solid SDG-aligned financing ecosystem that would generate the needed financial impetus from both within and outside of the national financial systems for infrastructure development initiatives towards accelerating SDGs achievement, especially SDG 9, in Ghana.
Considering the areas of infrastructure, nurturing innovative financing strategies for this sector has the potential to stimulate economic development and human wellbeing as it can unleash competitive economic opportunities to generate employment and income. To this end, UNOPS supported the Ministry of Finance to develop a pipeline of 16 bankable infrastructure projects and investment opportunities in the transport, energy, education, housing, solid-waste and green sectors. The projects which are at various stages of investment readiness - feasibility, pre-feasibility, and concept stages – were prioritised in consultation with the Government and were evaluated against the United Nations SDG Investment Fair criteria, and with further mapping of SDG and NDC impacts and gender outcomes. Proudly promoting Ghana as an investment destination for high impact sustainable development projects.
“Achieving the SDGs will require taking crucial concrete actions by the governments and the private sector to accelerate progress toward achieving the SDGs… I am very much convinced that we can attain our lofty ambitions for achieving the SDGs only if we work together.” Ifeoma Charles Monwuba, Director/Representative UNOPS, Ghana, The Gambia, Liberia, Nigeria, Sierra Leone.
An infrastructure financing strategy (IFS) was also developed to enhance innovative solutions for financing SDG-aligned infrastructure in Ghana. The strategy defined potential sources of financing and identified 53 additional funds and financiers across 15 sectors and seven financing instruments.
According to Professor George Yaw Gyan-Baffour, Senior Policy Advisor to the Minister of Finance, the Government was hopeful that the Innovative Financing Strategies for infrastructure projects “will help accelerate financing for sustainable infrastructure in Ghana ultimately to bridge the infrastructure financing gap which is critical in achieving the global goals by 2030.” This was further reiterated by the President of Ghana, His Excellency Nana Addo Dankwa Akufo-Addo when he noted that “the prospects for success (of the SDGs) depend on the scale, scope, and quality of partnerships that we forge with the private sector and our ability to mobilize innovative and smart financing to support implementation of the goals.
With a little over seven years to go to reach the 2030 target date, and given the many challenges we face globally, finding innovative finance to bridge the SDG financing gap and providing resources at scale to developing countries in particular, are critical determinants for achieving the SDGs. As the UN Secretary-General indicated in the Financing for Development 2021 report, the “UN has a critical role in supporting the mobilization of resources for sustainable development” and the UN in Ghana will continue to use its convening power to urge collective action and support efforts towards mobilizing resources for Ghana and ensure the country’s accountability frameworks are enhanced and employed at all levels of SDGs implementation.
Key steps the UN country team is taking beyond these initiatives is strengthening its multistakeholder partnerships to enable the government to mobilise adequate private capital and development finance to support government's post-covid economic recovery programme. The prime focus of development finance and partnership strategy of the UN Sustainable Development Cooperation Framework 2023-2025 is to enable the government shift its focus from the traditional investment mobilisation strategies to proactive exploitation of innovative means to mobilise investments from public and private capital and transform investment pipelines into sustainable impacts on livelihoods.