SDG 17 - Partnerships for the goals

Strengthen the means of implementation and revitalise the global partnership for sustainable development


Data extracted in August 2018

Planned article update: September 2019

Highlights


EU trend of SDG 17 on partnership for the goals

This article provides an overview of statistical data on SDG 17 ‘Partnership for the goals’ in the European Union (EU). It is based on the set of EU SDG indicators for monitoring of progress towards the UN Sustainable Development Goals (SDGs) in an EU context.

This article is part of a set of statistical articles, which are based on the Eurostat publication ’Sustainable development in the European Union — Monitoring report - 2018 edition’. This report is the second edition of Eurostat’s series of monitoring reports on sustainable development, which provide a quantitative assessment of progress of the EU towards the SDGs in an EU context.

Goal 17 calls for a universal, rules-based, open, non-discriminatory and equitable multilateral trading system under the WTO and the implementation of duty-free and quota-free market access for all least developed countries. The goal highlights the importance of global macroeconomic stability and the need to mobilise financial resources for developing countries from international sources as well as through strengthened domestic capacities for revenue collection.

Full article

Partnership for the goals in the EU: overview and key trends

Monitoring SDG 17 in an EU context focuses on global partnership and financial governance within the EU. While the EU has achieved some progress in the area of global partnership, financial flows to developing countries have decreased over the past few years. The progress in the sphere of financial governance within the EU has been less favourable.

Global partnership

In an interconnected world, relationships can no longer be limited to North–South or state-to-state connections. To achieve the ambition of the 2030 Agenda, cooperative and strong partnerships are necessary at all levels and between different governments, the private sector and civil society. The EU has taken steps in this direction with the creation of a multi-stakeholder platform on the SDGs [1], with the aim to support and advise the European Commission on the implementation of SDGs at the EU level.

Advanced economies such as the EU can support the implementation of the 2030 Agenda in developing countries through the mobilisation of public and private, domestic and international resources. These resources can be both financial and non-financial [2], although this article focuses on the former. Overall, the trends shown by the indicators chosen for the global partnership paint a rather favourable picture for the EU over the past few years. For instance, trade relations with developing countries have intensified.

The EU supports country-led development through a range of financial support mechanisms

In 2015, in the Addis Ababa Action Agenda (AAAA), all countries, including EU Member States, recognised that international public finance plays an important role in complementing countries’ efforts to mobilise public resources domestically, especially in the poorest and most vulnerable countries with limited domestic resources. Official development assistance (ODA), other official flows (OOFs), private flows, such as foreign direct investment (FDI), and grants by NGOs are different types of financial flows from the EU and its Member States to developing countries. The EU’s financial assistance supports the 2030 Agenda by helping reduce poverty and vulnerability and improve well-being and development.

A positive trend regarding the total volume of financial flows from the EU to developing countries has been visible over the past two decades. The OECD estimates that total EU financing to developing countries, comprising flows from the public and private sector, amounted to EUR 144.7 billion in 2016. This is more than 2.5 times as high as the financial flows in 2001 and almost four times higher than in 2002, when financing to developing countries experienced a trough, at only EUR 38.8 billion. However, due to a decline in private flows in 2016 compared with previous years, the short-term trend over the period 2011 to 2016 is slightly unfavourable.

While OOFs and grants by non-governmental organisations (NGOs) have remained at a rather marginal level, ODA and private flows combined have accounted for a share of more than 95 % in total financing for development since 2006. Private flows, however, have experienced a huge variation over the years, ranging from only 0.8 % of total financing in 2002 to 69.0 % in 2007. Therefore, ODA can be seen as the most reliable and steady financial flow from the EU to developing countries [3].

Official development assistance: a long struggle to meet targets

Figure 2: Official development assistance as share of gross national income, EU-28, 2005–2017(% of GNI)
Source: OECD (sdg_17_10)

The idea that donor countries should contribute 0.7 % of their gross national income (GNI) to ODA has been on the international agenda for nearly half a century [4]. This target, originally set for 1975, was missed again in 2015 and was only met by four EU Member States in 2017. As a whole, the EU spent 0.5 % of its GNI on ODA in 2017, after having stagnated close to 0.4 % of GNI for the period 2005 to 2014. The increase between 2014 and 2017 by almost 0.1 percentage points is partly linked to the recent refugee crisis, as donor countries are allowed to count certain expenses for refugees for the first year after the refugees’ arrival as ODA. Thus, on the one hand, the extent of the recent refugee crisis is one reason why ODA saw such an increase in 2015 and 2016. On the other hand, collective EU ODA increased by 10 % in 2016 even when excluding donor refugee costs [5]. For 2017, however, figures show a 2.4 % decrease of EU collective ODA compared to 2016 [6]. The EU ODA/GNI ratio for 2017 stood at 0.50 %, down from 0.53 % in 2016. A decline in in-donor refugee costs contributed to this fall in EU collective ODA in 2017.

ODA as a share of GNI is intrinsically linked to the EU’s economic situation. This became particularly visible when overall flows fell during the economic downturn in 2008 and its aftermath, while the actual ratio of ODA to GNI did not change significantly. With several developments expected in the years ahead (for example, the withdrawal of the United Kingdom from the EU) there may be further negative effects on progress. Despite these challenges, the EU continues to commit itself to the 0.7 % target. Building on the EU Council Conclusions from 2015 [7], the new European Consensus on Development [8], signed in June 2017, reaffirms the EU target of providing 0.7 % of its GNI as ODA, this time by 2030. However, with only four EU countries having achieved this target in 2017, additional efforts will be needed from a majority of Member States to meet the renewed collective commitment.

The EU remains the biggest ODA donor in the world

In 2017, the EU maintained its position as the biggest ODA donor globally, providing EUR 75.7 billion [9]. This figure refers to the combined ODA provided by all EU Member States and the non-imputed spending by the EU institutions.

Additionally, with 0.5 % in 2017, the overall EU ODA/GNI ratio was significantly higher than for most other OECD donors such as Canada, Japan or the United States. At the same time, aid from emerging donors is increasing. For example, the United Arab Emirates spent 1.31 % of its GNI on ODA, which was the highest ratio for a country reporting to the Development Assistance Committee (DAC) in 2017 [10].

The EU seeks coherence between all financial flows to developing countries

Figure 3: EU financing to developing countries, by financing source, EU-28, 2000–2016 (billion EUR, current prices)
Source: OECD (sdg_17_20)

The EU seeks to pursue a coherent approach so that developing countries can combine aid, investment and trade with domestic resources and policies to build capacity and support self-reliance. ODA, for example, can be used to mobilise other financial resources such as domestic taxes or foreign investment, thus unlocking trade and private financing. Other innovative instruments have been developed, such as blending grants with loans or equity from public and private financiers, to reduce risks. Resources can also come from developing countries’ own national tax systems; the EU provides support to improve the mobilisation of these domestic resources.

The financial support offered by the EU, combined with domestic financial flows, provides a strong basis for achieving the goals of the 2030 Agenda, allowing for investment in social services, clean energy, sustainable infrastructure, transport and information and communications technologies. In the best-case scenario, developing countries could leapfrog some of the unsustainable modes of production and consumption that were — and still are — visible in industrialised countries.

The fastest growing type of bilateral ODA between 2000 and 2015 was for ‘economic infrastructure and services’, with an annual growth rate as high as 11.7 %. In contrast, bilateral ODA for ‘action related to debt’ decreased by 11.4 % annually during the same time period, making up only 0.7 % of total ODA in 2015, although a growing number of countries are being confronted with debt distress [11]. ODA related to ‘social infrastructure and services’ made up the largest share of bilateral ODA throughout the years, accounting for almost one-third (31.2 %) in 2015.

The EU particularly supports least developed countries

To target resources where they are most needed — least developed countries (LDCs) and countries in states of fragility and conflict — the EU also has a target to collectively provide 0.15–0.20 % of GNI to LDCs in the short term, reaching 0.20 % within the timeframe of the 2030 Agenda. Between 2000 and 2015, out of all country groups that were listed on the DAC’s lists of ODA recipients, growth in the EU's assistance was slowest for LDCs. The Consensus takes a comprehensive approach to implementation, combining aid with other resources, with sound policies and a strengthened approach to Policy Coherence for Development. It puts emphasis on better-tailored partnerships with a broader range of stakeholders and partner countries. Data show that EU aid to LDCs has been stagnating at 0.11 % of GNI and further efforts will be needed from a majority of Member States to meet the collective commitment by 2030.

EU imports from developing countries have more than doubled

Figure 4: EU Imports from developing countries, by country income groups, EU-28, 2000–2017 (billion EUR, current prices)
Source: Eurostat (sdg_17_30)

The potential contribution of trade to sustainable development has long been acknowledged. This is also reflected in the EU's trade and investment strategy ‘Trade for All’ [12], adopted in 2015. Exports can create domestic jobs and allow developing countries to obtain foreign currency, which they can use to import other goods needed either for consumption or production. Better integration of developing countries into world markets may thus reduce the need for external public flows such as ODA. Several of the SDGs refer to the importance of trade for sustainable development, with SDG 8 calling on countries to increase aid for trade, particularly for LDCs, and SDG 17 calling, among others, on countries to ‘significantly increase the exports of developing countries, in particular with a view to doubling the least developed countries’ share of global exports by 2020’.

Since 2002, EU imports from developing countries more than doubled, from EUR 359 billion to EUR 957 billion in 2017. In the long term, EU imports from developing countries grew by 6.8 % per year on average. In the short term since 2012, imports still grew, but less intensely so, with a growth rate of 2.1 % per year. The share of imports from developing countries to the EU in imports from all countries outside the EU increased from 38.3 % in 2002 to 51.5 % in 2017. China (excluding Hong Kong) alone accounted for 39.2 % of EU imports from developing countries in 2017. The share of imports from least developed countries increased between 2002 and 2017, at a slightly higher rate than that for all developing countries. Overall, the almost 50 countries classified as least developed by the UN accounted for only 2.0 % of all imports to the EU in 2017 [13].

While the share of LDCs in world merchandise and commercial services exports remains far too low, there are some positive signs for a potential recovery driven by access to EU markets. Firstly, over the past few years the EU strengthened its role as the main export market for LDCs’ goods, ahead of China (21 %) and the United States (8.2 %): its share of global LDCs’ exports of goods increased from 20.5 % in 2012 to nearly 25 % in 2016 [14]. Secondly, the composition of EU imports from LDCs has significantly changed, shifting progressively from fuel and mining products to manufactured goods. In 2017, EU imports of manufactured goods grew by 6.5 % to EUR 27.1 billion, or 71.8 % of total imports from LDCs, against 42.6 % in 2012. However, these trade figures can be volatile. A sharp fall in commodity prices in 2016 led to an 8.3 % decrease of EU imports from LDCs compared to 2015 [15].

‘Aid for trade’ is a part of ODA that is targeted at trade-related projects and programmes. Aid for trade aims to build trade capacity and infrastructure in developing countries, particularly least developed countries, so that they can benefit more strongly from trade. The EU and its Member States were the leading global providers of aid for trade in 2015, accounting for 49 % of total aid for trade provided by DAC donors. Their aid for trade almost doubled between 2006 and 2015, to reach EUR 2.8 billion in 2015 [16].

In spite of the positive developments in trade with developing countries, it needs to be acknowledged that the EU’s trade-related indicators — measuring the share of imports from developing countries and indicating which products developing countries export to the EU — do not provide insights on whether the products in question are produced in an environmentally and socially sustainable manner. They also do not enable conclusions about the EU’s trade balance with developing countries, as exports are not taken into account.

Financial Governance within the EU

To help others to advance their economies, it is pivotal to keep the EU’s own economies on a sustainable development path. Macroeconomic management that aims to ensure financial stability in the EU is therefore one pillar of the EU’s contribution to implementing the SDGs. In addition to financial stability, the EU seeks to transform its economy to become greener, for example through its Europe 2020 strategy for smart, sustainable and inclusive growth. In a global context, where consumption patterns in one region can severely impact production patterns elsewhere in the world, it is particularly important that prices reflect the real costs of consumption and production. They should therefore also include the payments for negative externalities of polluting or other damaging activities to human health and the environment.

The overall trends at the EU level based on the selected indicators look considerably less favourable than for the ‘global partnership’ above, with falling shares of environmental taxes since the early 2000s. To facilitate this, the EU calls for a shift from labour taxes to environmental taxes.

Financial stability: recovering after the economic crisis

Figure 5: General government gross debt, EU-28, 2002–2017 (% of GDP)
Source: Eurostat (sdg_17_40)

Government debt should be limited to a manageable level and not exceed 60 % of GDP, as laid down in the Treaty on the Functioning of the European Union. However, with the onset of the economic crisis in 2008, debt-to-GDP ratios have risen considerably in many EU Member States. The year 2015 was the first since the economic crisis in which governments’ debts fell slightly compared with the previous year, and this decrease continued in 2016 and 2017. At 81.6 % of GDP, the debt-to-GDP ratios of Member States nevertheless remained far above pre-crisis levels, when the ratio was close to the 60 % reference level.

Across the EU, debt-to-GDP ratios ranged from almost 180 % to less than 10 %. A total of 15 Member States reported a debt ratio above 60 % of GDP at the end of 2017. In the period between 2012 and 2017, 16 countries managed to reduce their debt-to-GDP ratios. The more recent decline of debt levels in the EU since 2014 was a result of falling debt-to-GDP ratios in 22 Member States.

‘Greening’ the taxation system remains a challenge

Figure 6: Shares of environmental and labour taxes in total tax revenues, EU-28, 2002–2016 (% of total tax revenues)
Source: Eurostat (sdg_17_50)

In a context where trade takes place globally, products produced in one region of the world are usually consumed elsewhere. Prices should thus also include the payments for negative externalities of polluting or other damaging activities to human health and the environment. However, prices that reflect the real costs of production and consumption are a challenge, in particular when the entire supply chain needs to be considered. EU policies such as Europe 2020 consequently call for a major shift of taxation from labour towards environmental taxes as part of a ‘greening’ of taxation systems, meaning that revenues from environmental taxes should increase relative to labour taxes. The indicator 'shares of environmental and labour taxes in total tax revenues' presents the shares of these taxes in total revenues from taxes and social contributions.

Overall, the data show there has been no shift of the taxation burden from labour to environment in the EU: in 2016, environmental taxes accounted for only 6.3 % of total tax revenues, while labour taxes accounted for 49.8 % of total tax revenues, an almost eight times higher share. Revenues from environmental and labour taxes as a share of total revenues from taxes and social contributions have both fallen slightly since 2002. In the short-term period since 2011, the decline in the shares of labour tax revenues was slightly stronger than for environmental taxes, indicating a small increase in the relative importance of environmental taxes.

In 2016, the shares of environmental taxes in total revenues from taxes and social contributions ranged from 4.6 % to 11.7 % across Member States. At the same time, labour taxes accounted for 34.0 % to 58.3 % of total tax revenues in these countries. The ratio of labour to environmental taxes shows how much higher the shares of labour tax revenues were compared to the shares of environmental taxes in a country. In 2016, this ratio ranged from 3.6 to 11.9 across Member States. The countries with rather high ratios such as Germany, Belgium, France and Sweden were all characterised by shares of labour taxes well above 50 % of total tax revenues, while environmental tax revenues only made up about 5 % of total tax revenues in these countries. In contrast, countries with lower ratios of labour to environmental taxes reported shares of labour taxes well below 40 %, while environmental taxes accounted for 8 % or more in total tax revenues. In a majority of Member States, the ratio of labour to environmental taxes has increased since 2004, indicating an increase in the relative importance of labour tax revenues compared to environmental taxes.

Context

The world today is more interconnected than ever before. The SDGs can only be realised with a strong commitment to global partnership and cooperation. Coordinating policies to help developing countries manage their debt, as well as promoting investment for the least developed ones, is vital to achieving sustainable growth and development. The EU has long been committed to global partnership by supporting less-developed economies through official development assistance. Over the past decade, there has been a shift in the balance of roles, from donor-recipient towards a more equal partnership. The EU has been strongly involved in processes such as the Busan Partnership for Effective Development Cooperation and the Nairobi High level Meeting of the Global Partnership. However, to help others, the EU also has to ensure its own financial stability and to focus on the financial governance of its Member States.


More detailed information on EU SDG indicators for monitoring of progress towards the UN Sustainable Development Goals (SDGs), such as indicator relevance, definitions, methodological notes, background and potential linkages, can be found in the introduction of the publication ’Sustainable development in the European Union — Monitoring report - 2018 edition’.

Notes

  1. European Commission, Multi-stakeholder platform on SDGs.
  2. Non-financial resources include domestic policy frameworks, effective institutions and support for good governance, democracy, rule of law, human rights, transparency and accountability; see also the Addis Ababa Action Agenda (AAAA).
  3. A new statistical measurement is being developed, TOSSD (Total Official Support for Sustainable Development) which aims to support the Addis Ababa Action Agenda by providing a more comprehensive picture of resources for sustainable development, including, among others, mobilised resources from the private sector, emerging donors' flows, and south-south cooperation.
  4. In 1970 the UN General Assembly ratified a Resolution which officially introduced the goal that “Each economically advanced country will progressively increase its official development assistance to the developing countries and will exert its best efforts to reach a minimum net amount of 0.7% of its gross national product at market prices by the middle of the Decade. UN (1970), International Development Strategy for the Second United Nations Development Decade, UN General Assembly Resolution 2626 (XXV), 24 October 1970, paragraph 43. For a summarising background, see also OECD (2003), Papers on Official Development Assistance (ODA), OECD Journal on Development, Vol. 3/4.
  5. European Commission (2017), EU Official Development Assistance reaches highest level ever, Brussels, press release, 11 April 2017.
  6. European Commission (2018), EU remains the world's leading donor of development assistance, Brussels, press release, 10 April 2018.
  7. Council of the European Union (2015), A New Global Partnership for Poverty Eradication and Sustainable Development after 2015’ — Council conclusions, 9241/15, Brussels.
  8. European Union (2017), The new European Consensus on Development ‘Our World, Our Dignity, Our Future’, Joint statement by the Council and the representatives of the governments of the Member States meeting within the Council, the European Parliament and the Commission. 2017/C 210/01. Official Journal of the European Union, Volume 60.
  9. European Commission (2018), EU remains the world's leading donor of development assistance: €75.7 billion in 2017, Brussels, press release, 10 April 2018.
  10. OECD (2018), Development aid stable in 2017 with more sent to poorest countries, preliminary 2017 data, 9 April 2018.
  11. Economic and Social Council (2018), International Development Cooperation, Debt Vulnerability Concerns Focus, as Economic and Social Council Wraps Up Financing for Development Forum, Forum on Financing for Development, 7th & 8th Meetings (AM & PM), ECOSOC/6909, 26 April 2018.
  12. European Commission (2015), Trade for all - Towards a more responsible trade and investment policy, Commission’s Communication, COM(2015)497 final.
  13. Source: Eurostat (online data code: (ext_lt_maineu)).
  14. European Commission (2017), Trade in goods with LDC (Least Developed Countries), p. 8; and European Commission (2013), Trade in goods with LDC (Least Developed Countries), p. 9.
  15. European Commission Directorate General Development and Cooperation — EuropeAid (2014), Cotonou Agreement and multiannual financial framework 2014–20, Luxembourg, Publications office of the European Union; and European Commission (2017), Trade in goods with LDC (Least Developed Countries), p. 7.
  16. European Commission (2017), Aid for Trade Report 2017: Review of progress by the EU and its Member States, p. 5.
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