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As part of the preparatory activities for the UN’s International Conference on Financing for Development (Ff4D), to be held in Seville, Spain in June 2025, Akash Deep and I had the privilege of representing CID at UNHQ in New York.

June’s FfD4, dubbed the COP of the development finance world, will bring together global leaders, policymakers, development financiers and civil society, with the aim of reforming the international financial architecture, closing the staggering $4.2 trillion annual financing gap needed to achieve the Sustainable Development Goals (SDGs).

New York’s academic day sought to bring together key thinkers in the field, including Nobel Prize-winning economist Joseph Stiglitz, to begin to shape the agenda for what would follow at the important summit in Spain.

Akash and I were fortunate to host a panel, showcasing our work on the intersection of climate and development finance. Joining us were Zeineb Ben Yahmed, a former ÌÇÐÄvlog¹ÙÍø graduate and current Climate Finance Specialist at the Climate Policy Institute, and Douglas Beal, Head of Social Impact in Financial Institutions at Boston Consulting Group. 

But how did we get to FfD4?

In 2002, the first International Conference on Financing for Development was held in Monterrey, Mexico, resulting in the ; a comprehensive framework designed to address global financing challenges through the unprecedented integration of financial, trade, and development policies.

The plan set out shared responsibilities for mobilizing financial resources for development, focusing on domestic reforms, increased international aid, and fairer trade systems. Furthermore, it also called for a need to address debt challenges as well as reform financial systems, in order to better serve developing countries.

Following Monterrey, the 2008  reinforced previous commitments made, while also addressing the fallout of the global financial crisis. This was followed in 2015 by the  Agenda, furthering expanded the scope of inquiry and incorporating emerging priorities such as sustainable infrastructure, climate action, and leveraging private capital through innovative mechanisms such as blended finance.

Collectively, these 3 conferences emphasized 6 key focus areas:

• Domestic Resource Mobilization. Enhancing the capacity of countries to generate revenue through improved tax systems, efficient public spending, and combating illicit financial flows.
• International Development Cooperation. Strengthening official development assistance (ODA) and ensuring its effective use, alongside fostering South-South cooperation.
• Private Sector Engagement. Leveraging private investment for development through public-private partnerships and creating conducive environments for business.
• Trade as an Engine for Development. Promoting fair trade systems, such as increasing access to global markets through WTO reforms.
• Debt and Debt Sustainability. Addressing the challenges of debt in developing countries to ensure it does not hinder development efforts.
• Systemic Issues. Improving global economic governance to create coherence and ensure consistency in international monetary, financial, and trading systems.

Marching Towards the fourth Ff4D

A decade later and as we approach the fourth FfD4 - coming at a time of intensifying climate change effects and escalating global conflicts - the SDG financing gap unfortunately remains far from being closed. With this in mind, Akash and I presented a case for a clearer delineation between climate and development finance.

As climate finance aims to generate global public goods (such as emissions reductions), while development finance focuses on local benefits (poverty alleviation, job creation and economic growth), combining these two streams often leads to suboptimal outcomes for both. By disentangling them, there is the potential to unlock greater financial flows, ensuring that both climate and development goals are achieved more effectively.

Through my own professional experience at British International Investment (BII), I have seen first-hand the challenges and trade-offs that occur when you channel climate and development finance from within the same organization.

Climate finance needs are greatest in middle-income countries (MICs), where growth in energy demands will be the greatest, requiring significant investment in clean energy. In contrast, development finance is urgently needed in low-income countries (LICs), where basic infrastructure such as roads, schools, and healthcare facilities remain critical priorities. So which regions should an organization with limited resources (650 staff and a balance sheet of $10bn) like BII prioritize? 

Rethinking Finance for the Future

Therefore, as we prepare for FfD4 in 2025, it is clear that traditional approaches to financing are no longer enough. By disentangling climate and development finance, we are better able to mobilize resources to address their unique challenges. You can find our full published on the Belfer Center website.