Inter-Agency Policy Brief: Breaking the SDG finance gridlock through strengthening local government finance

In an ongoing initiative to advance SDG localization, UNDESA in collaboration with an inter-agency taskforce of UN entities and other relevant stakeholders issues a compilation of policy briefs providing evidence-based recommendations for SDG localization. This policy brief on local government finance was prepared by the UNCDF, UNDESA and UNDP in close collaboration with the Global Taskforce of Local and Regional Governments and Local 2030, with input from the Global Fund for Cities Development (FMDV), United Cities and Local Governments (UNCLG) and UN-Habitat.

The 2015 Addis Ababa Action Agenda, particularly paragraph 34 on subnational finance, marked a significant milestone in global discussions on local development finance, as it was the first time that UN Member States explicitly acknowledged the importance of enhancing municipal and subnational government capacities for funding and financing public services in a negotiated outcome document on Financing for Development. 

Since then, local governments across the globe have made significant strides in accountability, transparency and sound public financial management practices and have been at the forefront of climate action. 

This policy brief argues that (1) following the Addis Agenda the case for strengthening local government finance as an accelerator of national development has become stronger, (2) local and regional governments have continued to innovate on development finance (3) the Fourth International Conference on Financing for Development on 30 June-3 July 2025 in Sevilla, Spain (FFD4) provides a real chance to break the gridlock on development finance for achieving the SDGs by strengthening local government finance.

The Policy Brief is available as PDF and as interactive website version.