NEW YORK: The United Nations warned on Monday that time is running out to meet the Sustainable Development Goals as conflict, climate pressures and shrinking development finance push the poorest and most vulnerable countries further off track. In its Financing for Sustainable Development Report 2026, the UN said that with four years left until the 2030 deadline, progress has stalled and in some cases reversed after the shocks of the pandemic, rising geopolitical tensions and worsening climate impacts. One quarter of developing countries still have lower per capita income than before the pandemic.
The report said development finance is under strain at a point when many governments are struggling to fund basic services and investment. It said 3.4 billion people live in countries that spend more on interest payments than on health or education, underscoring the pressure created by debt burdens and higher borrowing costs. The United Nations said official aid has fallen sharply, foreign direct investment remains weak and many countries are still unable to raise enough tax revenue to support development needs, leaving a financing gap of up to $4 trillion a year for developing economies.
The financing squeeze has been reinforced by a steep drop in official development assistance. OECD preliminary data published this month showed aid from members and associates of the Development Assistance Committee fell 23.1% in real terms in 2025 to $174.3 billion, the largest annual contraction on record and a second straight yearly decline. The UN report said aid had already fallen in 2024 and that debt servicing burdens have reached their highest levels in two decades, adding to pressure on lower-income countries that are already contending with slower growth and tighter fiscal space.
Aid Decline Deepens Pressure
The report said trade tensions have added another layer of strain for developing countries. Average tariffs on exports from the world’s least developed countries rose from 9% to 28% in 2025, while tariffs for other developing countries excluding China increased from 2% to 19%, according to the UN findings. The conflict in the Middle East has also intensified pressure by raising the cost of fuel, fertilizer and food and by disrupting trade, transportation and tourism, factors that have compounded external financing risks for countries with limited fiscal buffers.
The broader development backdrop has also deteriorated. The Sustainable Development Goals Report 2025 said only 35% of targets are on track or making moderate progress, while nearly half are moving too slowly and 18% are regressing. The financing report links those setbacks to the widening resource gap and frames implementation of the Sevilla Commitment, agreed in 2025, as the current multilateral framework for mobilizing more capital, improving debt sustainability and strengthening the voice of developing countries in the international financial system.
Renewable Investment Shows Resilience
Despite the financing pressures, the report pointed to areas of strength in the global economy. It said growth in 2025 exceeded expectations, trade among developing countries has expanded fourfold over the past two decades and investment in renewable energy reached a record $2.2 trillion in 2024, double the amount invested in fossil fuels. Those gains, however, have not offset the scale of the funding shortfall facing countries that need capital for health, education, infrastructure, climate adaptation and broader economic development.
The United Nations said narrowing the gap will require faster action to raise investment, strengthen multilateral cooperation and reform parts of the international financial architecture so that developing countries have greater access to financing and a stronger role in decision-making. The report also called for measures to improve resilience against future shocks as governments confront tighter credit conditions, heavier debt burdens and weaker aid flows at a critical stage for the 2030 agenda. – By Content Syndication Services.