Domestic Resources for Sustainable Development

Domestic Resources for Sustainable Development: Target 17.1

Sustainable development is a universal-programme for global-concern, which according to Brundtland’s report(1987) is, development that meets the needs of the present without compromising the ability of future-generations to meet their own needs”. The United Nations’ 2030-agenda for SUSTAINABLE DEVELOPMENT, adopted by all countries (2015), provides a shared-blueprint to achieve sustainability for people & the planet. At its heart are the 17 Sustainable Development Goals (SDGs), giving an urgent action-call to all countries for global-partnership.This shows that SDGs can only be actualized with strong global-partnerships & cooperation. This brings us to 17th-SDG without which achieving the rest of the first 16-goals will be a near impossible task. SDG-17th aims to strengthen the means of implementation and revitalize the global partnership for sustainable development.

SDG 17 refers to the need for cross sector & cross country collaboration in pursuit of all goals by the year 2030. It is aimed towards enhancing North-South & South-South cooperation, to align policies together with a vision for improved & more equitable trade as well as coordinated investment initiatives to promote sustainable development across borders,  thereby helping developing countries increase their exports to ensure Universal rules-based and equitable trading system that is fair, open & beneficial to all. The Goal embodies targets broken into five categories:  Finance, technology, capacity building,  trade & systematic issues. Progress towards these targets will be measured by 25 indicators. High-level progress reports for all the SDGs are published in the form of reports by the UN Security-General

SDG 17th targets long-term investments to empower sectors & companies in need, especially in developing countries. SDG-17 has 19 targets & 24 indicators. The first and the foremost target is formulated as: mobilize resources to improve domestic revenue collection. This target is about strengthening DRM through  international support to developing countries so as to improve their domestic capacity for tax & other revenue-collection. DRM is a core priority of the sustainable development agenda. The 2015 Addis-Ababa-Action-Agenda on Financing for Development emphasized that the “mobilization and effective use of domestic resources are central to our common pursuit of sustainable development”.This broad target has two indicators, one is about total government revenue as a proportion of GDP, by source & second is related  with proportion of domestic budget funded by domestic taxes.

Domestic Resource Mobilisation (DRM) refers to a process through which countries raise & spend their own funds to provide for their people a long-term path to Sustainable Development finance. DRM will be crucial in implementation of SDGs not only to meet the sheer-scale of investment needed to implement the 2030 Agenda for Sustainable Development & SDGs, but also because it holds broader promise for transformative change. If undertaken successfully, DRM can generate substantial benefits for state-citizen relations, economic stability & growth, & redistribution. Progressive reforms coalition, through which the rich pay relatively more than the poor, are a precondition for creating transformative eco-social and fiscal contracts. This is easier in contexts with greater state-capacity, where resource bargains are more transparent & inclusive, & where national-bargains are supported by global-bargains, the latter providing resources & regulation.

DRM not only provides the government with funds to alleviate poverty & deliver public-services but is also an important step on the path out of aid-dependence. The State-capacity to mobilize its own resources & collect taxes to pay for essential services (eg: Education), lies at the core of a properly functioning government. Domestic taxation also increases accountability, thus, creating a social or fiscal-contract between State & citizens. Moreover, in order to achieve the ambitious SDG agenda, developing countries will need to raise more revenues. Although external sources will pay their part, most of revenues will be domestic. To balance increased revenue with equitable  development,  taxation needs to be progressive & used efficiently & transparently.Taxation is a powerful tool to help finance SDGs achievements. Adequate domestic & international fiscal-policies can also play a crucial role reducing inequalities & promoting positive sustainable development patterns. Such fiscal policies can be targeted towards environmental protection by incentivizing domestic & foreign investment in the production of renewable energy & may also encourage healthy life through taxing alcohol & exempting healthy-foods. Fiscal policies can simultaneously achieve both DRM objectives and promote sustainable consumption & production patterns as in the case of elimination of fossil-fuel subsidies among others. 

Likewise, research in information & communications technologies(ICT) in Information-Era has furthered access to new digital-media that play an important role in effectively networking for mobilization-purposes. In highly-globalized world, the internet is a vital-tool to provide access to information & can help foster cooperation.  Indicator-17.6.2 provides a way- fixed Internet broadband-subscriptions per 100 inhabitants. It implies high-speed access to the Internet(TCP/IP-connection), at downstream-speeds ≥ 256 kbit/s.

 

Challenges : Fiscal-incidence analysis for 29 low & middle-income countries shows that, while fiscal policy unambiguously reduces income-inequality, that is not always true for poverty meaning that poor are made poorer. DRM agenda could make this situation worse. The big risk in setting an ambitious DRM agenda is that in the process governments will tax the poor even further.The demand for additional domestic resources must be balanced against the competing need to protect the poor from becoming poorer as a result of taxes. Policy Innovations for Transformative Change a publication of UNRISD suggests that the prospect of achieving the new SDGs will depend in part on the ability of governments to improve their tax collection enforcement systems. Combating illicit financial flows (IFFs) is a major challenge for all governments as a significant barrier to the implementation of the SDGs.

CONCLUSION: To conclude, it could be said that a more inclusive global-partnership for greater DRM is needed. This requires clearer-commitment by governments, corporates & diverse stakeholders.The need for DRM has now taken on greater urgency given  a long-lasting fiscal impact of the COVID-19 crisis on revenue-generating capacity.Prospects increased for public and private financing from the developed to the developing world have been muted by the pandemic, so, the key to sustainable human and infrastructure investment over the long term will be increased DRM. To recover from the pandemic and make progress towards the SDGs, finance for development must increase from “billions-to-trillions” per year.

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