30 Jun Closing the Funding Gap: Assessing the Role of Multilateral Development Banks in Advancing SDG17

Ivana Soto

Law School, IE University, Madrid, Spain.

Dual Degree in Laws and International Relations.

E-mail: isoto.ieu2021@student.ie.edu.

Abstract

The global Sustainable Development Goals (SDG) annual finance gap is currently estimated at $4 trillion, creating a major impasse for low- and middle-income countries. Within this context, Multilateral Development Banks (MDBs) have emerged as key actors in addressing the gap by facilitating access to financing and fostering multi-stakeholder partnerships. Focusing on two strategic instruments—blended finance and thematic bonds—this article examines how MDBs leverage resources, de-risk private investment, and catalyse cooperation among governments, private actors, and civil society in support of SDG 17. It argues that while MDBs are uniquely positioned to advance SDG 17’s targets through their technical expertise and ability to mobilise alternative funding, existing structural challenges constrain their potential. To support a more effective deployment of blended finance and thematic bonds, the article offers policy recommendations focused on technical support and governance reform to strengthen MDB-led efforts.

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Keywords: Sustainable Development Goals, SDG 17, Development Finance, Partnerships, Multilateral Development Banks, Blended Finance, Thematic Bonds.