Policymakers from developing countries in Asia and the Pacific, including the Philippines, called for urgent measures to address the region's pressing financing gaps for sustainable development.
During a high-level regional consultation on financing for development, leaders from the Economic and Social Commission for Asia and the Pacific (ESCAP) stressed the need for coordinated international support, enhanced domestic resource mobilization, and greater private sector engagement to address the staggering $4 trillion annual financing gap in developing countries worldwide.
“High public debt, rising borrowing costs, and limited international support are undermining progress,” ESCAP said in a statement, noting that while the Asia-Pacific region remains the most economically dynamic globally, tackling debt is a significant challenge.
In 2023, several Asia-Pacific economies faced debt distress, with interest payments consuming over 10 percent of government revenues in 15 countries.
“More than 2.2 billion people in the region live in countries that spent more on interest payments than on health care,” said Armida Salsiah Alisjahbana, United Nations Under-Secretary-General and ESCAP Executive Secretary. “Developing countries, therefore, need urgent solutions to their debt woes, which requires effective international coordination and response.”
Rebeca Grynspan, Secretary-General of the UN Conference on Trade and Development (UNCTAD), emphasized that “the smaller and least developed the country, the more patchy, volatile, and costly its access to finance. From a development perspective, this makes no sense. It means that if development were a race, the most behind are running on sandals, while those already ahead run on sneakers.”
H.E. Bishnu Prashad Paudel, Deputy Prime Minister and Minister of Finance of Nepal, called for innovative solutions, public-private partnerships, and a clear domestic revenue mobilization strategy with specific goals and targets.
Participants noted progress in development financing, with the region’s average tax revenue rising to 18.4 percent of gross domestic product (GDP) in 2022, up from 13 percent in 2001. However, they stressed that there is room to enhance tax revenues further in some developing economies.
An ESCAP study revealed that a rationalized tax structure, digitalized tax administration, and fewer wasteful tax exemptions are the three main factors that matter most for increasing tax revenues.
ESCAP, in partnership with UNCTAD, the Asian Development Bank (ADB), and the Asian Infrastructure Investment Bank (AIIB), organized the regional consultation ahead of the Fourth International Conference on Financing for Development in Spain from June 30 to July 3, 2025.