The world is off-track to meet the SDGs by 2030. This is due in part to the persistent financing gap, which stands at between $2.5 and $4 trillion annually, according to current UN estimates. In late June, world leaders will gather in Seville, Spain for the Fourth International Conference on Financing for Development (FfD4). The aim of FfD4 is to transform the funding landscape to fill the SDG financing gap. FfD4 presents an opportunity to breathe new life into the SDGs and national development plans because it gets to the heart of what’s needed to achieve the goals and build equitable and sustainable economies.
Strong data and statistical systems are essential for advancing the financing for development agenda. Robust data systems inform financial policy and shape effective financing strategies and solutions. Accurate and reliable data and statistics can ensure that public resources are used as efficiently as possible, they can drive domestic resource mobilization, and they should inform private investment to maximize returns. Too often, national data and statistical systems face chronic underinvestment which hampers these financing goals. To reverse this trend and mobilize much-needed investment, data should be recognized as a cross-cutting issue in the FfD4 outcome alongside concrete commitments and actions.
On January 17, the ‘zero draft’ of the FfD4 outcome document was released, setting the stage for negotiations and building on consultations that have been underway since July. The zero draft offers a strong starting point. It includes language on data and statistics across several sections, making the case for data as a driver of financing outcomes. However, there is still some way to go to ensure strong language on data and statistics survives the negotiations and to translate these key points into concrete actions around which member states can build consensus and a way forward.
Why data and statistical systems matter for financing
Robust data and statistical systems influence financing outcomes through three key pathways:
- Efficient use of public resources - Informed decision-making depends on reliable information. To deliver services and achieve development outcomes for people, good data and statistics help target scarce resources and ensure that assistance is directed to those most in need. In the digital era where financial management and service delivery are digitized, there is even more opportunity to leverage data and statistics for decision-making.
- Shaping domestic resource mobilization - Collecting and managing tax revenue, combating tax evasion and stemming illicit financial flows depends on effective systems for collecting, managing, and sharing data within and between governments. Data and statistical systems that are open and have the capacity to manage data sharing with non-state actors such as academia, civil society, and the private sector also drive innovation, economic growth, and efficient service delivery.
- Informing private investment - Private finance requires good data and statistics, especially to ensure that risk is priced accurately. In the absence of such information, the cost of capital may be prohibitively high and many countries may miss out on critical investment opportunities.
Getting this right isn’t just about one indicator or dataset, nor is it only about one survey or even the census. It’s about ensuring stable and predictable investment in countries’ national data and statistical systems, from the legal framework, to technical infrastructure, to capacity development.
National statistical offices (NSOs), together with other national stakeholders, have worked hard over time to increase the availability of timely and reliable information, but many are challenged by severe funding shortfalls, insufficient political support for system-wide modernization, and shortcomings in technical infrastructure and capacity.
Many countries recognize the need to address these shortcomings with strong recommendations in place at regional and global levels. The African Union's Second Strategy for the Harmonization of Statistics in Africa (2017-2026) calls on AU member states to allocate at least 0.15 percent of their national budgets to finance statistics. The Global Digital Compact, adopted by UN member states at the Summit for the Future in September 2024, emphasizes the need to “increase financing for data and statistics from all sources,” with a particular focus on building capacity in developing countries. It advocates for scaling up predictable financing for sustainable development data. The Secretary-General’s 2023 SDG Report highlights the importance of "reaping the data dividend" by setting concrete targets for 2030, such as increasing domestic financing for data and statistics by 50 percent and ensuring donors allocate at least 0.7 percent of official development assistance (ODA) for data.
To put these recommendations into practice, several governments have prioritized data and statistics in the FfD4 process. They are working towards more concrete and actionable recommendations in FfD4 through the High-level Group for Partnership, Coordination and Capacity Building, and individually through their delegations. We believe their involvement in the process is key as they will have to lead implementation at the national level.
FfD4 zero draft: A strong start but more to do
The zero draft is a strong start with several short but substantive paragraphs on data and statistical systems across the document. We appreciate the strong paragraph in the first section which provides the rationale for investing in data systems and why such investment is integral to the overall achievement of the financing for development agenda.
The text also emphasizes the need to strengthen data and statistical systems and improve data sharing to help modernize tax systems, combat illicit financial flows, mobilize private capital, and shape trade policy. There are several references to digital public infrastructure, which is a critical ingredient to formalize economies and provides the infrastructure needed to manage data flows across the public sector. Having this language woven across the text helps re-frame data system investment as a driver of financing rather than only for monitoring commitments. This is an important achievement and represents a relatively modest investment for member states.
The document would be even more powerful if it included a commitment to support a minimum set of priority actions for data and statistical systems in all countries, linked to key sustainable development outcomes for people and planet. This could be framed as a package of actions which would include investing in data and digital infrastructure, key steps to modernize data and statistical processes to leverage new data and technology, technical assistance to ensure data quality and reliability, and capacity development ensuring that all countries have access to sufficient skilled personnel. Most countries already have strategies and plans to work on these key priorities. A commitment in the FfD4 outcome document to provide stable and predictable investment to support these strategies would fill a critical gap.
Such a commitment would strengthen the final section of the outcome document by making the existing language on investing in data systems more concrete and actionable. Working towards an actionable commitment along these lines would be a relatively low-cost win for member states that would have a multiplier effect across the financing for development agenda. Research shows that for every dollar invested in data systems, there is an average return of $32.
As member states and other stakeholders prepare for the negotiations at the third Preparatory Committee meeting in February, it will be important to acknowledge and support the strong language on data that is in the zero draft, and to seize the opportunity to push for an even stronger action for improved data and statistics.