The UN DESA’s FSDR 2024 report titled “Financing for Development at a Crossroads”

Current Context: On 9th April 2024, The United Nations’ 2024 Financing for Sustainable Development Report (FSDR 2024) highlighted the urgent need for a massive surge in financing to rescue the Sustainable Development Goals (SDGs).

• Here are some key points from the report:
• The development financing gap is now estimated at USD 4.2 trillion annually, up from USD 2.5 trillion before the COVID-19 pandemic.
• This increase in the financing gap is due to a confluence of crises including staggering debt burdens, sky-high borrowing costs, rising geopolitical tensions, climate disasters, and a global cost-of-living crisis.
• The report emphasizes that without adequate financing, the 2030 targets cannot be met.
• If current trends continue, the UN estimates that almost 600 million people will continue to live in extreme poverty in 2030 and beyond, more than half of them women.
• The report also highlights that billions of dollars are lost annually from tax avoidance and evasion, and fossil fuel subsidies are in the trillions.
• Debt burdens and rising borrowing costs are large contributors to the crisis.
• In the least developed countries, debt service will be USD 40 billion annually between 2023 and 2025, up more than 50 per cent from USD 26 billion in 2022.
• The report calls for scaling up public and private investment in the SDGs, highlighting the importance of reforming the development bank system.
• The report is a stark reminder of the urgent need for action to achieve the 2030 Agenda for Sustainable Development.
• It calls for bold actions to scale up SDG investment and reform the global financial system.

Question:

Q.1 What is the estimated annual development financing gap according to the United Nations’ 2024 Financing for Sustainable Development Report (FSDR 2024)?
a. USD 2.5 trillion
b. USD 3.5 trillion
c. USD 4.2 trillion
d. USD 5.0 trillion