IMF warns 2030 sustainable development goals at risk as funding gaps widen

Mint

06-06-2025

New Delhi: The International Monetary Fund has warned that the world is increasingly unlikely to meet the sustainable development goals (SDGs) by 2030 as financing needs far exceed what many countries can realistically manage—raising the risk of broader macroeconomic imbalances.
The warning came after the IMF executive board reviewed a staff paper evaluating the fund's role in supporting international development financing.
The review precedes the Fourth Financing for Development Conference (FfD4), scheduled to be held in Sevilla, Spain, from 30 June 30 to 3 July.
The IMF paper flags a deteriorating development outlook, reassesses the feasibility of the SDGs, and outlines measures to accelerate progress amid mounting financial and economic pressures.
'A series of shocks since 2020 has compounded longstanding structural challenges, hitting low-income and fragile states the hardest,' the IMF said in a statement on Friday. 'Debt vulnerabilities deserve attention, particularly for low-income countries,' it added.
While debt remains broadly sustainable, the IMF noted that many countries face steep interest costs and rising refinancing needs, constraining their ability to invest in critical development spending.
'Against this background, achieving the sustainable development goals by 2030 appears increasingly unlikely,' it said.
Adopted in 2015, the SDGs comprise 17 goals and 169 targets designed to eliminate poverty, tackle climate change, reduce inequality, and promote prosperity.
But with the deadline fast approaching, global progress is faltering amid growing financing gaps, economic headwinds and geopolitical uncertainty.
'Accelerating development progress will require a major collective effort,' the IMF said, 'including strong domestic reforms, adequate international support, and proactive debt management.'
It also called for tailored approaches, warning that rising divergence among developing countries demands more nuanced reform agendas and support frameworks.
Meanwhile, IMF directors have stressed the need for a 'major collective effort' combining ambitious domestic reforms with robust international support. This includes advancing sound macroeconomic policies, improving public spending efficiency, strengthening governance, mobilising domestic resources, and boosting private-sector-led growth and job creation.
International backing—through well-coordinated capacity development and additional public and private finance—will be critical, the IMF said.
The IMF directors have also endorsed efforts to improve debt restructuring mechanisms for countries with unsustainable debt, including deeper relief under the Common Framework and the Global Sovereign Debt Roundtable's new 'restructuring playbook'. They also supported a 'three-pillar approach' to help countries where debt is sustainable but constrains productive spending, the IMF added.
The IMF's role, though not developmental by design, remains vital in preserving macroeconomic and financial stability—a prerequisite for sustainable development, it said.