The United Nations Capital Development Fund today presented its new Strategic Framework 2018-2021 during the 2018 first regular session of the Executive Board.

“UNCDF’s vision, to make finance work for inclusion, builds on what we do best and where we can make the biggest difference: it is focused on least developed countries, on the last mile where needs are great and resources most scarce, and on taking risks where few others see viability, in order to create demonstration value,” said Judith Karl, Executive Secretary of UNCDF, at the Executive Board in New York.

“The 2030 Agenda commits to leaving no one behind, and to meeting the goals and targets for all nations and all segments of society. The Addis Ababa Action Agenda and the 2030 Agenda identify the need for multiple sources of finance, public and private, domestic and international, to work together effectively and in new combinations. Yet only a small fraction of global investment assets is targeted at sectors and localities that advance sustainable development in developing countries,” Karl continued. “Our vision deepens UNCDF’s core strengths as they relate to local development finance, financial inclusion, and our work to establish an investment platform that can expand deployment of capital instruments to a growing pipeline of projects in the last mile in least developed countries.”

In his opening statement to the first regular session of the Executive Board, UNDP Administrator Achim Steiner said: “The UNCDF Strategic Framework […] highlights UNCDF’s critical role to make finance work for the poor and to get finance flowing to where it is needed most. I see great additionality in UNCDF’s programmatic and early investor work. As UNDP and the wider UN system accelerate support to LDCs and MICs to optimize public and private investment for SDG achievement, UNCDF’s ability to deploy a range of financial instruments to de-risk and prove concept has considerable system-wide applicability. UNCDF’s LDC investment platform is a vehicle ready for take-off, with existing capacity to direct investment to the most excluded people, businesses, and localities, thereby creating impact across a range of SDGs.”

“I also see how UNDP and UNCDF can collaborate to develop enabling environments that drive digital innovation, deepen domestic financial markets, and ensure that LDCs share in rewards from blended finance. Together we can also ensure that applications of innovative finance solutions in MICs are contributing to cross-country demonstration and learning and showing how new deployments of financial instruments can address inequalities in a range of different country settings,” he continued.

What did we accomplish?

UNCDF has achieved significant results over the course of the Strategic Framework 2014-2017. During this period, UNCDF invested US$106.8 million in financial service providers to reach over 14 million saving clients with a range of financial products and expand the frontiers of financial inclusion and served 4.7 million new clients with financial products that strengthen their resilience to shock.

Since 2014 UNCDF also invested $72.7 million to enhance local development finance in over 20 countries It directly supported 4,263 infrastructure investments through local government investment programmes during the Strategic Framework period. These investments have demonstrated local capacity and stimulated policy reforms that accelerated local basic service provision and local economic development.

Grounded on the principles of inclusiveness, response to the needs of least developed countries, innovation to scale and leaving no one behind, the new Strategic Framework 2018-2021 builds on UNCDF’s 50 years of experience in expanding inclusive financial markets and local development finance systems that help unlock public and private finance at the local level and describes how UNCDF will support countries to achieve the 2030 Agenda and the Sustainable Development Goals and related agreements.

Strategic Plan, 2018–2021: The two outcomes

The UNCDF Strategic Framework 2018-2021 aims to support the achievement of sustainable development goals 1 and 17 in least developed countries by making finance work for inclusion. The Strategic Framework presents two outcomes that capture the essence of what UNCDF does: enhancing inclusive financial markets and local development finance systems, and unlocking public and private finance for the poor.

UNCDF will pursue innovative finance solutions through: (a) financial inclusion that expands the opportunities for individuals, households, and small and medium-sized enterprises to participate in the local economy, with a focus on digital financial services; and (b) local development finance that shows how fiscal decentralization, municipal finance, and structured project finance can promote local economic expansion and local climate adaptation. Women’s economic empowerment is articulated across all UNCDF work.

The Strategic Framework articulates how UNCDF will strengthen its lending and guarantee instruments alongside its grants and technical assistance, and presents the role of the least developed countries investment platform in making blended finance approaches available to a wider range of United Nations partners, if called upon and funded to do so.

The Strategic Framework identifies four results-to-resources scenarios, providing Member States the means to recommit to supporting UNCDF to achieve the ideal scenario, which includes $25 million per year in core; $75 million per year in programme funding; and a $50 million capitalization of the LDC Investment Fund. This would support a strategic presence in 40 least developed countries.

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To read the Strategic Plan in full, please visit www.uncdf.org/strategic-framework-2018-2021

Watch the Executive Board session at https://webtv.un.org/