All eyes are on the Integrated National Financing Framework (INFF) Approach in Indonesia
Posted June 30, 2022
Jakarta, 21 June – As the world faces an enormous financial gap to fund the Sustainable Development Goals (SDGs) Agenda, Government of Indonesia in partnership with the United Nations team in Indonesia, endeavours to bridge the gap by developing a roadmap for the Integrated National Financing Framework (INFF).
In the recently organized Second Financing Dialogue of the Integrated National Financing Framework (INFF) event hosted by the Ministry of National Development Planning (Bappenas) in collaboration with the United Nations (UN) in Indonesia and the United Nations Development Programme (UNDP) Indonesia, the INFF's strategic role in aligning the massive investment in the financial system toward SDG achievement was highlighted – including its critical role in financing a more streamlined approach to SDG financing.
The INFF is an integrated tool to help countries strengthen planning and overcome challenges to financing the SDGs agenda. The scheme was first coined in 2015 in the Ethiopian capital, Addis Ababa, ahead of the launch of the SDG Agenda.
Indonesia's close pursuit of the INFF roadmap is in line with the country's transformation of its SDGs financial architecture, according to Vivi Yulaswati, Head of the SDGs National Secretariat of Bappenas.
"Indonesia has designed an economic transformation to build a sustainable future with the SDGs as the main framework. We have created a sustainable ecosystem by producing a sustainable finance roadmap, green taxonomy, SDGs investor mapping, Indonesia Impact Fund, ESG stock market index, and mainstreaming SDGs to state-owned enterprises and investment policy," said Yulaswati in her opening remarks.
"Given these initiatives, INFF is well-positioned to accelerate the creation of holistic financing strategy," she added.
The projected roadmap will alight on important concepts of gender responsiveness and climate-sensitive need in response to the increasing need for climate action and the Leave No One Behind goal.
Following the COVID-19 pandemic, many nations are now faced with a lack of funds to deal with the climate crisis, as well as the consequences of increased geopolitical tensions, such as rising food prices. Top finance and development experts believe that innovative SDG financing with the private sector should be the key to unlocking more funding.
"The real challenge is to align trillions of dollars invested in capital markets with the SDGs. Emphasizing the importance of this issue," UN Resident Coordinator in Indonesia, Valerie Julliand, said in her opening remarks.
"There is a vast amount of private capital, and that capital can help governments bridge the SDG financing gap. The INFF is key to unlocking resource mobilization opportunities and forging closer partnerships with the private sector," Julliand added.
UNDP Indonesia Resident Representative Norimasa Shimomura said that all stakeholders need to work together to identify catalyst solution on SDG financing.
``The COVID-19 pandemic and current global political landscape have caused disruption that is putting an additional strain on the SDGs and its financing. The world is forced to reassess its strategy to bring SDGs back on track and to fill greater financing gap. And in doing so, to identify financing opportunities that can deliver catalytic impact on the SDGs," said Mr. Shimomura in his opening address.
INFF helps reform policies and identify innovative instruments and platforms to mobilize and align finance with the SDGs. More than 80 countries worldwide are developing the blueprint for the INFF. Accordingly, during Indonesia's leadership of the G20 this year, UNDP is taking stock of INFF initiatives under the Government of Indonesia's guidance and is working to produce a compendium of good practices and financing strategies to inform the outcome of the G20 Development Working Group.
Among key issues discussed in the webinar were Sustainable Finance Instruments, Budget for SDGs, Blended Finance, Localization of SDGs, ESG, SMEs, Industry 4.0 and International Engagement, among others.
The planned INFF roadmap will be included in the Development Finance Assessment (DFA). The outcome of this virtual event will be incorporated into the prescriptive portion of DFA. The dialogue also contributed to the identification of priority areas for inclusion in the INFF, such as providing incentives to MSMEs, mainstreaming SDGs across policies and regulations, improving impact measurement, and strengthening partnerships to advance initiatives.
Text by Anisa Indah Pratiwi and Kamal Salehin
Edited by Tomi Soetjipto and Ranjit Jose