The 2025 World Investment Report reveals that funding to achieve the Sustainable Development Goals (SDGs) in developing countries has decreased significantly through 2024. Investment in infrastructure fell 35 per cent, renewable energy fell 31 per cent, water and sanitation fell 30 per cent, and agrifood shrank 19 per cent. Meanwhile, the health sector was the only one to show positive growth of 25 per cent - albeit from a relatively low base value - raising concerns that the pace of investment still falls short of SDG targets.
This contraction in investment funds has particularly affected poor and vulnerable countries. The decline in international project finance (IPF) funding, which in some countries accounts for more than 60 per cent of total infrastructure investment, has weakened efforts to close the SDG gap. With only the health sector growing, observers believe that the financing gap will widen further if it is not addressed through new policies and financial instruments, such as blended finance, to mobilise capital flows from both the public and private sectors.
