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solutions and frugal technologies. The rising SDG financing gap illustrates the compounding pressures on developing
economies, where fiscal space has been increasingly constrained due to ongoing crises. The COVID-19 pandemic,
for instance, diverted resources from development spending to emergency health responses and social protections,
increasing national debt burdens and fiscal deficits. For many countries in the Global South, debt servicing alone
occupies a significant portion of annual budgets, leaving limited scope for long-term investments in SDG-oriented
sectors.

5.1. Emerging South-South and Triangular Partnerships as a Solution
South-South cooperation enables developing countries to leverage shared experiences, cultural similarities, and
regionally applicable solutions to pursue SDG financing. Countries in the Global South, particularly emerging economies
like Brazil, India, China, and South Africa, have demonstrated innovative, cost-effective approaches to development that
align well with the needs of their peers. By sharing technical expertise, resources, and knowledge, these nations can
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foster sustainable development without reliance on traditional donor structures.

One notable example is India’s technical cooperation in healthcare and digital payment infrastructure, shared with
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African nations through platforms like the India-Africa Health Sciences Collaborative Platform (IAHSP). Similarly, Brazil’s
agricultural advancements in biofuels and sustainable farming provide a model for other countries aiming to balance food
security with environmental sustainability.

Triangular cooperation, which involves collaboration among two or more developing countries with support from a
third party (often an international organisation or developed country), offers an enhanced financing model. By involving
diverse partners, this approach brings in additional financial resources, risk mitigation, and technical support. Japan,
for example, has been actively engaged in triangular partnerships with African and Asian nations, supporting disaster
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management, infrastructure, and public health projects. Such collaborations pool resources while encouraging cross-
country learning and sustainable financing practices.

In addition, China’s BRI has also incorporated elements of triangular cooperation, bringing together Asian, African, and
Latin American countries on mutually beneficial infrastructure projects. The BRI’s influence on infrastructure financing
in the Global South exemplifies how large-scale development efforts, though sometimes controversial, can generate
significant regional spillovers, attracting additional investment for other SDG-related sectors.

5.2. Localised Financing Models and Frugal Technologies

Localised financing models, prioritising funding through local resources and community-driven projects, represent a vital
strategy for SDG financing in the Global South. By reducing reliance on external funding and focusing on locally relevant
goals, communities can allocate resources more effectively and sustain development outcomes. In countries like Kenya,
the local use of mobile banking (such as M-Pesa) has facilitated financial inclusion, enabling small businesses and low-
income populations to participate in the economy, thereby advancing multiple SDGs such as poverty reduction, gender
equality, and economic growth. 86

Frugal innovation—solutions that provide high social impact at a low cost—is well-suited for SDG financing across
the Global South. These technologies are typically affordable, scalable, and resource-efficient, often drawing on local
materials and expertise. For example, India’s solar water pumps offer a cost-effective alternative for small-scale farmers,
reducing both water and energy costs while enhancing agricultural productivity. Similarly, Rwanda’s use of drones for
medical supply distribution reduces healthcare delivery times in remote areas, demonstrating how low-cost technology
can address infrastructure deficits in resource-scarce regions.

83. Sunaina Kumar, “A greater G20, and BRICS-by-BRICS, the Global South-led reform of international governance”, The Interpreter, The Lowy Institute,
October 31, 2024, https://www.lowyinstitute.org/the-interpreter/greater-g20-brics-brics-global-south-led-reform-international-governance
84. Ministry of External Affairs, “MoU on India-Africa Health Sciences Cooperation between the Indian Council of Medical Research and
African Union”, Ministry of External Affairs, Government of India, March 27, 2019, https://www.mea.gov.in/press-releases.htm?dtl/31184/
MoU+on+IndiaAfrica+Health+Sciences+Cooperation+between+the+Indian+Council+of+Medical+Research+and+African+Union
85. “Japan’s Foreign Policy to Promote National and Global Interests”, Diplomatic Bluebook 2023, Ministry of Foreign Affairs of Japan, Government of Japan,
2023, https://www.mofa.go.jp/policy/other/bluebook/2023/en_html/chapter3/c030103.html
86. “Transforming Financial Inclusion: The Impact of M-Pesa in Kenya and Beyond”, Business Today, October 2023, https://businesstoday.co.ke/transforming-
financial-inclusion-the-impact-of-m-pesa-in-kenya-and-beyond/#:~:text=M-Pesa%20Kenya%20has%20profoundly%20enhanced%20financial%20
inclusion%2C%20utilizing,integrating%20excluded%20segments%20into%20the%20formal%20financial%20system.

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