Why the SDGs financing matters for Montenegro?

Podgorica, 22 August 2023

Increased financing of Sustainable Development Goals (SDGs) is critical for a country’s success in fulfilling the promise of Agenda 2030. This is one of the key conclusions of the latest UN report Policy Brief: SDG Financing which looks deep into the funding structure of the national SDGs implementation.

“SDG financing is a crucial area to achieve the 2030 Agenda. While effective policies are needed for reforms, finance is required to ensure implementation. Montenegro, as it continues its EU accession process, needs to explore varied sources of finance as Official Development Assistance will play a diminishing role in the future,” said the UN Resident Coordinator in Montenegro, Peter Lundberg.

To increase expenditures on SDGs, mobilizing domestic finances is going to play an increasingly important role. Despite the progress in growing expenditures for SDGs in the first five years of SDG implementation, the progress was still not fast enough to ensure all targets were on track.

“As Montenegro goes forward the focus will need to remain on using finite resources efficiently and effectively, targeted at supporting those who are most vulnerable to ensure that the central promise of the 2030 Agenda is achieved,” said David Wright, Economist in the UN Resident Coordinator’s Office and one of co-authors of the Policy Brief.

The report reveals that Montenegro strategically prioritized SDGs in the first five years of their implementation, indicating that majority of the Government funding for SDGs - 83.8% - was directed towards 5 SDGs: poverty reduction (SDG 1), health (SDG 3), education (SDG 4), sustainable cities and communities (SDG 11) and peace, justice and strong institutions (SDG 16).

The largest share has been allocated for poverty reduction (32%), helping the country reduce ‘at risk of poverty’ rate from 24 percent to 21.2 percent.

“It matters where finances are allocated. Public finance is an important means to support the provision of public goods and the delivery of the SDGs. Expenditures function as a signal to the private sector and support complementary expenditures,” Wright said, adding that increasing expenditures in social sectors such as health and education can also increase skills, innovation, and support households with their disposable incomes.

The Policy Brief on SDG Finances is produced as the first edition in a series of thematic UN Policy Briefs which will be produced quarterly by the UN Country Team, aiming to tackle issues that slow progress on the 2030 Agenda. Each piece will provide an analysis of the issue and will offer recommendations on how to address them.