Three reasons why TOSSD can play a crucial role in the upcoming reform of the international development finance system

 

The envisaged deep reform of the international development finance system and the establishment of revitalized ‘North-South’ financing partnerships need to go hand in hand with inclusive statistics on sustainable development finance towards developing countries. Total Official Support for Sustainable Development (TOSSD) is the first measure that incorporates all official resources for financing the SDGs in developing countries, as well as addressing global challenges, beyond traditional development finance. With the International Forum on TOSSD to be created in 2024 as an independent body, TOSSD is progressively becoming the inclusive statistical standard that the global development finance community needs.

By the TOSSD Task Force co-chairs

Risenga Maluleke, Statistician General of South Africa and Director-General, Statistics of South Africa

Laurent Sarazin, Head of Unit, Finance and Contracts, Directorate-General of International Partnerships, European Commission

 

This year at the SDG Summit in New York and at the New Global Financing Pact Summit in Paris, world leaders, policymakers and investors reiterated that the 2030 Agenda’s outlook is bleak. Cascading political, environmental and humanitarian crises threaten even further the preservation of our planet and its people, aggravating global challenges such as climate change and refugees, in addition to putting pressure on all sources of development finance.

Development finance is at the core of the SDGs implementation. Thus, development finance statistics are key to track progress. The need for a higher resource mobilization and enhanced partnerships for sustainable development is crystal clear. A reform of development finance statistics is key for transparency and accountability, and here are three reasons why TOSSD has a key role to play.

1. TOSSD bridges historial statistical divides, which is paramount for a successful New Global Financing Pact 

The global system of development finance statistics needs to be more inclusive. TOSSD aims to connect two often historically divided realities. On one side, national statistical offices often lead the SDG monitoring at national level. Many countries subsequently aligned their budgets with the SDGs and put in place systems to track progress against specific SDG targets. On the other side, the financial flows from donor countries and multilateral organisations to developing countries are tracked by different development agencies and other relevant bodies. This creates a statistical divide, and a transparency gap that needs to be addressed. There is a genuine risk in having many inconsistent statistical datasets on development support across the globe, and a loophole in terms of how developing countries and wider stakeholders track and use development finance data. Siloed data systems can truly jeopardize sustainable development and dampen effectiveness of development finance. 

2. The sustainable finance panorama is evolving, and points of measurement need to evolve with it

Emerging actors from all over the world are contributing more and more to making our planet a sustainable place for all. Southern countries and institutions are also doing their part and are providing development co-operation, through South-South co-operation and triangular co-operation, intra-regional and win-win partnerships. Furthermore, a broad range of innovative types of financial instruments, involving the private sector and Multilateral Development Banks are being created, e.g. to combat climate change.

In the global agenda for a sustainable future, we are all one. TOSSD is the statistical space that can connect divided worlds and realities.

Created in 2017 in response to the Addis Ababa Action Agenda that started laying the ground for a reform of global financial practices, TOSSD is a statistical framework that a large and inclusive group of countries and organizations, also called the International TOSSD Task Force, have agreed upon.  It shows the full array of resources provided in support of sustainable development in developing countries and international public goods. It also aims at ensuring a coherent, comparable, and unified framework to measure and track SDG-related investments. TOSSD also monitors private finance mobilized by official interventions. In 2024, in order to further strengthen its global reach and anchor, TOSSD will transition to an independent International Forum with a Secretariat hosted by the OECD. 

3. The recipient perspective and SDG reporting are the cornerstones of TOSSD, thereby fostering local ownership and use

TOSSD measures resources from a recipient perspective, which is its main strength. The TOSSD online visualization tool shows the external support developing countries receive. Countries can track from whom and how much support they are receiving, as well as the channels used. TOSSD also helps monitoring support for achieving the SDGs. Reporters must assign SDG targets to all activities included in the measure. Such data are useful for developing countries for planning, identifying funding gaps, and tracking progress towards SDGs. Burkina Faso, for example, has included TOSSD data in its last HLPF's Voluntary National Review. Furthermore, TOSSD is a data source for the SDG global monitoring framework.

By its very nature, TOSSD echoes in a concrete manner the calls in the international community to modernize development finance and the international co-operation architecture. The 2023 Development Co-operation Report on Debating the Aid System boldly highlights, inter alia, the need to modernize development finance models and financial management practices, and rebalance power relations in international decision-making and partnerships. TOSSD allows an enhanced and more inclusive reporting on the financing of sustainable development instruments and flows.

TOSSD tells a real story, going beyond the traditional “North to South” narrative. TOSSD reflects a reality where all countries are doing their part to protect our planet and make sustainable development happen. 

For more information, read the TOSSD co-chairs’ vision and explore more on TOSSD.