LocationsClosing the global financial architecture gap
FFD4 offers a turning point to align finance with impact and redefine value
June 25, 2025
In Colombia integrated national financing has aligned more than US$1 billion in public spending, directing investment into agriculture and digital transformation.
Photo: UNDP Colombia/Freya Morales
The following is an excerpt of an op-ed that originally appeared in The Banker on 24 June 2025.
Around the world, countries have made significant progress in transforming their financial systems to build impact economies. Across government institutions, including finance ministries, national treasuries and planning commissions, there is meaningful reform underway. Countries are integrating climate priorities into budgets, aligning spending with the Sustainable Development Goals (SDGs), developing pipelines of investable projects, and creating conditions to attract private capital. These are bold and systemic efforts, and many developing countries are leading the way.
Yet the global financial architecture has not kept pace. The challenge is no longer ambition but alignment between national development strategies and the financial systems intended to support them. When reform efforts stall, it is often due to financial friction — the space between where capital exists and where it is needed. Outdated perceptions of risk, institutional inertia and fragmented instruments have widened this gap. Closing the gap will involve changing how finance aligns with national priorities, reflects contemporary circumstances, and operates effectively on a large scale.
Read the full op-ed here.
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