The fourth International Conference on Financing for Development (FFD4) got underway in Sevilla, Spain on the 30^th June amid warnings of extreme heat. And indeed by Tuesday afternoon the temperatures were hitting 44 degrees and the five kilometers from the venue to my hotel suddenly seemed a very long way to travel! 

While the heatwave made the conference very uncomfortable for delegates attending the intergovernmental discussions and the side events (which I attended), I hope it helped motivate delegates to get serious in planning how their countries individually and collectively will mobilize funding to respond to climate change.

FFD4 itself came after the closed door inter-governmental negotiations produced a final agreement – the Compromiso de Sevilla – in mid June. The conference aimed to secure implementation of the Compromiso. While the final outcome document is something of a compromise, I have to thank Mariana Mazzucato for pointing out that in fact compromiso translates to commitment in English rather than compromise. In agreeing to the document, the international community has agreed to make incremental changes to the global financial architecture – the international financial frameworks, rules, institutions and markets – rather than bringing sweeping changes. The original language around  transforming the international debt architecture was diluted during the negotiations, but the final agreement leaves the door open for future changes to make international debt slightly more development-oriented. 

Domestic resource mobilization to finance the SDGs dominated the side events at FFD4. Given the decline in ODA we are facing, domestic resource mobilization is critically important for global health. Many side events focused on blending of private and public finance to address SDG investment. These forms of finance are very promising for the development of renewable energy and infrastructure (which can provide attractive returns to private investors). But most of the required investments in public health systems provide long-term, society-wide returns that are not “bankable” (don’t provide a clear revenue stream to private sector investors). Blended finance for global health is likely to involve a mix of philanthropy, solidarity levies, donor funding and public finance with private finance playing a role in very specific infrastructure projects.

Here are my views on some key messages from the FFD4 side events for health funding in developing countries.

• New rules for exchange of special drawing rights (a reserve asset countries hold at the IMF) have been introduced. Developing countries may now draw up to half their SDR reserve to finance development projects. Financing experts urged countries to claim this new stream of funding. I would urge planners in health ministries to claim these funds for health before other ministries do so!
• It will be difficult for many developing countries to raise enough tax revenue to cover the gaps left by decreasing ODA without some changes in the global tax architecture. Negotiations on the UN Convention on International Tax Cooperation start in August. The Convention strives to introduce new rules for taxation of high net worth individuals and multinational corporations, many of whom pay almost no tax currently. Africa has spoken with one voice in agreeing to this convention, but needs the support of other blocs, especially the EU.
• Fossil fuel subsidies must go. Developing countries should also carefully assess how much tax they are “giving away” in other tax concessions (for example: exempting the aviation sector from taxation or creating special economic zones with generous tax incentives).  
• Better functioning tax systems in Africa are critical. There is much promising progress in this area and digitization and data sharing across sectors is key to further progress in combatting tax abuse.

The highlight of the conference for me was attending a dialogue with nine of the experts who  wrote the background report to the FFD4 Outcome document. It was wonderful to see a “healthy” level of disagreement in the expert panel! It was also inspiring to hear  Joseph Stiglitz  (one of my all-time heroes) discussing the need for new debt processes.  

Stiglitz & Mazzucato in a panel