Statement for Mr. Bharat Raj Paudyal, Foreign Secretary and LDC Chair, at the SDG Action Weekend side event – “Scaling up blended finance to mobilize private SDG investments in LDCs and other vulnerable countries”


Statement for Mr. Bharat Raj Paudyal, Foreign Secretary and LDC Chair, at the SDG Action Weekend side event – “Scaling up blended finance to mobilize private SDG investments in LDCs and other vulnerable countries”,

September 17, 15.15 – 16.45, UNCR 5

Her Excellency Roheey John Manjang, Minister of Environment of Gambia

Her Excellency USG Rabab Fatima


Ladies and Gentlemen,


I have the honor to deliver this statement on behalf of LDC Group.

Today, as we gather on the eve of the SDG Summit, we face choices of profound consequence, impacting billions of lives. Whether we succeed or fail to achieve SDGs will determine the fate of humanity in the decades to come.

Against this reality, we recognize that additional financing will be central to getting the SDGs back on track. Blended finance can play a key role in mobilizing the resources that are vital lifelines for our group of countries.

I stress that blended finance is a commitment to collaborative efforts that harness public and private resources to drive sustainable and inclusive transformation.

It helps reduce risks and bridge the gap between our goals and available resources. It unlocks private investments into areas like infrastructure, clean energy, green jobs, and in some cases, even healthcare and education.

I would like to highlight that if done right, it becomes a catalytic tool to mobilize a significant amount of private capital needed to invest in vital sectors of economy.

However, despite its growing needs, the share of blended finance received by the LDCs remains stubbornly low.

In 2021, only three of the top 20 beneficiary developing countries of blended finance were LDCs. And the bottom 10 LDC beneficiaries received less than $5m combined.

Why has that happened?

One of the key challenges for LDCs to attract private SDG investments is high-interest rates combined with high perceived risks.

For example, large renewable energy projects require high upfront investments and are perceived as risky, leading to a high Cost of Capital. Compounded with sovereign risk premiums, it becomes almost impossible to mobilize private investments for climate and SDG projects in LDCs.

We need to find ways to address this situation.

In my country Nepal, the annual average development financing gap to achieve the SDGs by 2030 is estimated at $17 billion, which is almost 50% of the country’s GDP. Blended finance can play an important role in helping to address this gap.

But this will not happen without public and private partners committing to significantly scale up the blended finance for LDCs.

While the IFIs and Development finance institutions have a primary role to play, as highlighted in the Secretary-General’s SDG Stimulus proposal, we also count on our bilateral development partners and the UN Development System to do more.

In this context, let me highlight a few additional actions to scale up blended finance for the LDCs:

  • First, the LDC Group has called for $100 billion of Special Drawing Rights (SDRs) to be reallocated for LDCs[1]. We should think creatively about how to use some of these reallocated SDRs to support SDG investments. Such investment also can attract private capital, perhaps through national development banks or as guarantees for increased SME lending.
  • Second, LDCs need to develop and deepen capital markets to better engage domestic and international investors. Blended finance can be prioritized to support the development of domestic financial institutions and intermediation.
  • Third, blended finance should be focused on SDG projects that are key national priorities.
  • Last, we need more support to develop pipelines of bankable projects and to create a more conducive climate for private investments, to complement blended finance.

To conclude, Excellencies, as we convene for the SDG Summit and join forces to accelerate progress towards the SDGs, our success will be measured not in words, but in the lives we transform, the people we empower, and the world we leave to future generations.

I hope our conversation here today will be an important step in addressing the financing gap that we are facing as we seek to realize the SDGs.

Thank you.