Building a complete picture of financing flows for Nigeria’s INFF
Under the leadership of the Ministry of Finance, Budget and National Planning, Nigeria has already made considerable progress on its Integrated National Financing Framework (INFF). It has recently concluded both a costing exercise with the IMF and a Development Finance Assessment with UNDP.
According to IMF estimates, an additional spending of 18 % of GDP by 2030 is required to achieve the SDG targets in education, health, electricity, roads and water and sanitation sectors in Nigeria. To achieve SDG targets in key sectors, spending would need to increase by 7.7% of GDP for education, 4% for health, 1% for electricity, 2% for roads, and 0.6% for water and sanitation by 2030.
The Development Finance Assessment (DFA) undertaken recently provides data and statistics for putting in place an INFF. The DFA shows the evolving trends in the financial flow landscape, the challenges faced by the COVID-19 pandemic and the numerous opportunities in innovative financing. Impact investment, diaspora bonds, and south-south cooperation are on the rise and if harnessed through an INFF have the potential of bridging the finance gap for Nigeria to achieve the SDGs.
To get a more complete picture of official and officially supported financing flows in support of sustainable development, a critical building block for an INFF, Nigeria has also been actively contributing to the development of Total Official Support for Sustainable Development (TOSSD). Together with the other members of the International TOSSD Task Force, Nigeria, through the Directorate of Technical Aid Corps (DTAC), has shaped the methodology for this new statistical framework.
In 2018, Nigeria participated in a pilot study on TOSSD, which tested the methodology based on the recipient country perspective, measured TOSSD flows to Nigeria and explored TOSSD as a way for Nigeria to report on its own support for sustainable development.
The study found that TOSSD flows to Nigeria amounted to 4.9 billion USD, which provides a more complete picture than, for instance, ODA (3.5 billion USD in 2018). Additional transparency on these flows is critical for the government as it develops its financing strategy within the context of the INFF.
As a country with a dual role (both recipient and provider of development co-operation), Nigeria can also use TOSSD to report on its own activities in support of sustainable development. Nigeria plays an active role in South-South cooperation, with extensive experience in providing technical co-operation to other countries, mainly through DTAC and the Directorate of Technical Co-operation in Africa.
With reporting on TOSSD launched in 2020, all countries now have the opportunity to be part of the international community that will help build this new, broader statistical measure of external support to the SDGs in line with the 2030 Agenda.
Bringing together statistics for financing for sustainable development
The first building block of an INFF consists in the review of the financing landscape of the country, which also includes the scoping of all financial flows for development, whether private or public, domestic or international. In several developing countries, Official Development Assistance (ODA) from bilateral and international donors, remains an important part of the financing mix to support their national development plans and the SDGs.
In recent years, donors have increasingly used official development aid also as a catalyst for other resources to support developing countries’ development agendas. These resources involve private finance, mobilised through PPPs (public-private-partnerships) and a wide range of other innovative financing instruments. In addition, an increasing number of other providers, South-South cooperation and emerging economies, play an important role in the financing landscape of developing countries.