As Prepared for Delivery

Mr. Chair, Distinguished Members of the Board, Excellencies, colleagues.

I am pleased to present an overview of UNCDF’s financial situation for the year 2023.

2023 presented several challenges for UNCDF: a reduction in the organization’s revenue base by 17% was further compounded by a reduction in overall expenses by 13%. Despite these, the organisation successfully managed to maintain business continuity and delivery, within the limited resources at hand, relying on earmarked, non-core contributions which, at irregular intervals, made up 95% of our total funding.

These challenges have translated in a constrained ability to adequately plan forward and develop long – term tools to effectively respond to member states calls for assistance in mobilizing private capital and supporting markets typically overlooked by traditional forms of capital assistance.

Today, UNCDF operates largely as a non-core based organization with core resources comprising only 5% of total contributions. This imbalance poses a significant challenge to providing sustainable long-term solutions to support LDCs and other developing countries, whose sovereign risk status often excludes them from traditional finance. Without addressing this imbalance, the full realization of the UNCDF mandate may face further delays.

The situation reported for 2023 is not, however, an anomaly for UNCDF: as for other development institutions, the reduction in core contributions has been a slow but consistent pattern over time.

As the incoming Executive Secretary, I am committed to working with UNCDF’s Managing Director and with your support to reverse this trend. I am optimistic about this challenge, given UNCDF’s continued relevance in the current context of finance for development.

First, UNCDF stands as the unique platform within the UN Development System (UNDS) established by a General Assembly resolution to support countries access sustainable sources of capital. In today’s discussions on financing for development, UNCDF’s role is more critical than ever. As highlighted by UNDP’s Administrator and the Managing Director of UNCDF yesterday, while UNCDF has yet to fully realize its mandate, it is both necessary and possible to do so.

Secondly, my optimism is reinforced by the confidence donors have shown in UNCDF through non-core contributions, and UNCDF is nearing the completion of a pillar assessment by the EU to deploy its guarantee facility. I also wish to acknowledge and thank the Governments of Switzerland, the USA, Luxembourg, the Netherlands, Austria, China and Thailand for their continued support through their essential core contributions.

Thirdly, I am optimistic because the UNDS has begun actively engaging with UNCDF to leverage its unique financial instruments in support of their development programmes. I am committed to ensuring that our partnerships with UNDP, UNICEF, FAO, WFP, UN Women and others continue to grow and deliver impact.

Our priority is to convert these promising opportunities into a scaled-up engagement of UNCDF, particularly in support of LDCs, to mobilize capital for development. Your feedback on specific actions or information needed from UNCDF to help reach our target of $25 million in core funding per annum, as outlined in the Strategic Framework, will be helpful.

Your support is crucial, and we are prepared to ensure UNCDF is fully equipped to help developing countries, especially LDCs, deploy our financial instruments to attract private sector finance, unlock potential in domestic markets, and derisk transactions for larger concessional finance deploying entities to come in.

We must change UNCDF’s trajectory to ensure it continues to add unique value to the UNDS, particularly in optimizing opportunities to mobilize private capital with scarce public resources in high-risk markets. Without core or lightly earmarked resources, we cannot replicate the lessons from the Tanzanian sub-national bond issuance that unlocked $25 million for water infrastructure improvements in a municipality largely with capital from the domestic market. It means that the requests of the likes of the Lesotho National Development Corporation, who reached out for assistance in capitalizing a loans and guarantee programme to crowd in private investment will take longer to materialize. We are unable to expand the investment and advisory support for blended finance solutions to LDCs and UN agencies like the Netherlands’ funded Investment Advisory Initiative, currently active in 15 African countries and highly appreciated by the RC system.

These missed opportunities do not only impact individual countries – they hinder the UN’s ability to effectively mobilize private investment for development. As we embark on discussions to develop our new Strategic Framework and prepare for the upcoming FFD4 Conference in 2025, it is crucial to engage in an open conversation about UNCDF’s role in these unprecedented times.

UNCDF is a UN Fund with a distinct advantage: our ability to deploy loans, grants, and guarantees at the last mile; to deploy nationally-owned blended finance solutions that meet country specificities and absorption capacities; to support other UN entities amplify their mandate by attracting private capital in areas where others simply do not go at the speed, scale and focus that is required, which is critical for addressing poverty reduction and localized economic development in high risk environments.

As we move forward, I invite you to join me in a candid dialogue about the role you envision for UNCDF as we, together, shape the new Strategic Framework for 2026-2030, as a partnership. I look forward to your guidance to co-design and shape how UNCDF can be fit-for-purpose in the post-FFD4 era – that is, a truly UN’s catalytic financing entity.

Thank you for your continued support and commitment.