Recommendations to Strengthen the First Draft of the Fourth Financing for Development Conference Outcome Document

This report by the International Institute for Sustainable Development (IISD) provides detailed recommendations to strengthen the first draft of the outcome document for the Fourth Financing for Development Conference (FFD4). The document focuses on enhancing domestic resource mobilization, reforming private finance, improving climate financing for vulnerable nations, updating international trade rules, and establishing more robust debt-relief mechanisms.

• IISD recommends strengthening the taxation of natural resources to ensure revenues reflect the societal value of resources and support sustainable development. This is particularly critical for lower-income countries where natural resource rents represented more than 10% of GDP in 20 countries and more than 4% in over 40 countries in 2021.
• The report argues that the term "inefficient" regarding fossil fuel subsidies creates a loophole and should be removed. Instead, the document should specify that subsidies to be phased out are those that do not address just transitions or energy poverty, or require countries to create national roadmaps for phasing them out.
• IISD suggests that public procurement should be transformed from a bureaucratic process into a strategic policy tool for the Sustainable Development Goals (SDGs). This includes implementing performance-based procurement, life-cycle costing, and green public procurement to demand low-carbon solutions.
• To mobilize long-term financing for sustainable infrastructure, the report recommends building a domestic institutional investor base. It suggests providing incentives for local pension funds, mutual funds, and insurance companies to invest in domestic capital markets to reduce risks from external market volatility.
• For climate financing, IISD proposes a phased approach for Least Developed Countries (LDCs) to build foundational legal, regulatory, and governance systems before implementing innovative financial instruments. The report notes that in 2024, no carbon credit trading mechanisms existed in LDCs.
• The report calls for a comprehensive debt-relief initiative that serves both countries in debt distress and those facing high debt-servicing costs, regardless of whether they are solvent or illiquid. It recommends establishing a commission including the G20, Paris Club, and debtors to build consensus on this initiative.
• Regarding international trade, IISD suggests that unilateral trade-related environmental measures should be designed to support a global transformation toward sustainable production and be consistent with international obligations.

APA

International Institute for Sustainable Development (2025). Recommendations to Strengthen the First Draft of the Fourth Financing for Development Conference Outcome Document. https://www.iisd.org/system/files/2025-05/ffd4-outcome-document-recommendations.pdf

Chicago

International Institute for Sustainable Development. Recommendations to Strengthen the First Draft of the Fourth Financing for Development Conference Outcome Document. 2025. https://www.iisd.org/system/files/2025-05/ffd4-outcome-document-recommendations.pdf.

Wikipedia

{{cite report |author=International Institute for Sustainable Development |title=Recommendations to Strengthen the First Draft of the Fourth Financing for Development Conference Outcome Document |date=May 2025 |url=https://www.iisd.org/system/files/2025-05/ffd4-outcome-document-recommendations.pdf |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{internationalinstituteforsustainabledevelopment2025recommendations, author = {{International Institute for Sustainable Development}}, title = {{Recommendations to Strengthen the First Draft of the Fourth Financing for Development Conference Outcome Document}}, institution = {International Institute for Sustainable Development}, year = {2025}, month = may, url = {https://www.iisd.org/system/files/2025-05/ffd4-outcome-document-recommendations.pdf}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }