Development finance is increasingly diverse and complex. It includes public resources, private investment, portfolio flows and grants, as well as remittances and innovative forms of public–private partnerships. The OECD regularly publishes data and analysis on this website to help monitor those flows.
Finance for sustainable development
Under its mandate to track and promote financing for sustainable development from various public and private sources, the OECD undertakes data collection and reporting, analyses flows and policies and establishes statistical measurement frameworks. On that basis, the Organisation engages with governments and private actors and recommends more efficient and sound approaches.
Key messages
The main source of public financing to promote the economic development and the welfare of developing countries is official development assistance (ODA), adopted by the OECD’s Development Assistance Committee (DAC) in 1969.
The smart use of public resources to shift private investment towards sustainable development in low- and middle-income countries is a growing priority for both recipient and provider countries. By setting standards, documenting and sharing best practices, the OECD encourages development partners to improve their ways of working. The Organisation also works to draw private investment into the countries and sectors most in need, including through blended finance.
Faced with the dual challenge of investing in long-term, sustainable development and responding effectively to global crises, the world needs a more transparent, accountable and coherent development finance architecture. The OECD feeds the discussion by monitoring the financing and governance of the multilateral system, and exploring ways of mobilising all resources for sustainable investments in the regions and communities that need them the most.
Context
A growing gap in development financing
The estimated amount of annual finance needed to achieve the SDGs in developing and emerging countries surged by 36% from 2015 to 2022, in part due to extra needs created by climate change, yet resources only grew by 22% over that period. The resulting annual financing gap has increased by 60%, from USD 2.5 trillion to USD 4 trillion. Climate change, localised conflict and geopolitical uncertainty – which disproportionately affect developing countries – continue to drive financing needs.
Trends of total resource flows to developing countries
ODA is complemented by other concessional and non-concessional resources, from the official and private sectors.
Collected through DAC statistics, the data cover:
- Concessional flows, i.e. in addition to ODA, concessional lending by multilateral organisations and philanthropy.
- Non-concessional flows i.e. other official flows by bilateral countries, private sector instruments, non-concessional lending by multilateral organisations.
- Officially-supported export credits
- Foreign direct investments and other private flows at market terms
- Private finance mobilised through official interventions.
Total Official Support for Sustainable Development
Total Official Support for Sustainable Development (TOSSD) is an international standard for measuring the full array of resources driving sustainable development of developing countries, whether official or private finance mobilised through official means, and including contributions to global public goods. Initially developed at the OECD, TOSSD now has an independent governance: the International Forum on TOSSD.
