International private sector investment flows to developing and transition economies in sectors relevant for the sustainable development goals (SDGs) fell by one third in 2020 because of the COVID-19 pandemic. The value of newly announced greenfield investments in relevant sectors shrunk by 33% and that of international project finance (used for large infrastructure projects requiring multiple investors) by 36%. The COVID-19 pandemic has more than undone the increase in SDG investment since 2015 – the year the SDGs were adopted. Greenfield investment in SDG sectors in developing and transition economies is now almost 20% lower than before 2015, international project finance is more than 30% lower. The progress made in promoting and facilitating SDG investment is at risk. Full year data for 2020 shows that, except for renewable energy, where growth in new projects continued but was cut to less than one fifth of the pre-COVID rate, investment activity fell sharply across all SDG sectors. In infrastructure and infrastructure industries (including utilities and telecom), international project finance announcements were 60% lower in value. Greenfield project values across food and agriculture, water and sanitation, health and education were all one to two thirds lower than in 2019. The decline in SDG-relevant investment was much larger in developing and transition economies than in developed countries. In the latter group, gains in investment in renewable energy and digital infrastructure are a first sign of the asymmetric effect that large-scale public support packages in developed countries will have on global SDG investment trends.
