Sustainable financing for digital development: Evidence building and experience sharing on mobilising domestic public resources and community-led partnerships

Anriette Esterhuysen argues that a financing deficit in WSIS implementation has existed since 2003, when the WSIS Task Force on Financing produced a comprehensive report whose recommendations were largely ignored in the Tunis Agenda. She contends that this unresolved deficit means the international community is now at a critical juncture where failure to confront financing seriously will prevent progress.

She noted her personal membership of the WSIS Task Force on Financing convened by the Secretary General at the end of 2003, which reported back to the second phase in Tunis, and observed that very little of its recommendations were taken seriously or included in the Tunis Agenda . She concluded that a WSIS implementation financing deficit has persisted since 2003 and that the current moment demands serious confrontation of this issue .

Anriette Esterhuysen observes that discussions at the current WSIS Forum have focused predominantly on financing digital technology rather than financing sustainable development. She argues this represents a problematic shift away from the original people-centred vision of WSIS.

She noted that her experience attending sessions during the week showed that conversations on financing had not addressed financing sustainable development but were primarily about financing digital , directly affirming David Souter's concern about this framing shift.

Anriette Esterhuysen argues that development actors, rather than the digital community, should be placed at the front of the financing conversation. She contends that engaging people such as development finance experts and understanding the broader development finance context is essential, as the picture looks very different when the entry point is digital rather than development.

She emphasised the importance of working with people such as Rob Floyd and others who work in development finance to understand the context from the perspective of financing development more holistically, noting that the picture could look very differently if the entry point is just digital .

Anriette Esterhuysen argues that partnerships, investments, and financing relationships must be driven and shaped by stakeholders within developing countries rather than by external interested parties. She frames this as a fundamental question of sovereignty and equity in the global digital financing landscape.

She raised the question of how to ensure that relationships, partnerships, and investments are driven and shaped by stakeholders within those countries rather than by external interested parties, noting this point had been raised frequently throughout the week .

David Souter expresses personal disappointment at how contentious the arguments around financing were during the WSIS+20 General Assembly negotiations, and surprise at the degree of opposition to establishing a financing task force. He notes that reaching an uncontested resolution required leaving some issues, including financing for development, unaddressed in depth.

He described the process as having been as successful as it could be, calling it an achievement to reach an uncontested resolution in very difficult circumstances, but acknowledged that doing so meant some issues were not addressed in depth, with financing for development being one of them . He stated he was personally disappointed by how bruising the arguments around financing were and surprised by the degree of opposition .

David Souter argues that ICTs must play a major part in achieving the Sustainable Development Goals, making the financing question fundamental rather than peripheral. He also points to the UN's recent commitment on finance for development as an obvious basis for discussions on financing digital development.

He cited three reasons why a financing task force was well justified: first, it is generally acknowledged that ICTs must play a major part in achieving the SDGs ; second, there was a precedent task force between the first and second WSIS sessions ; and third, the UN had just agreed a serious commitment on finance for development, providing an obvious basis for discussions on financing digital development .

David Souter raises the fundamental question of whether the goal of WSIS financing discussions is sustainable development or digital development, and whether the discussions are people-centred or technology-centred. He identifies this as a core tension that must be resolved to give direction to financing efforts.

He posed the question directly: is the goal about sustainable development or digital development, about the development of society or the development of technology ? He observed two paradigms in the negotiations, with developing countries focused on developmental impacts and OECD countries focused on digital governance .

David Souter identifies a fundamental divide between developing countries and OECD countries in how they approach digital financing discussions, with the former focused on developmental impacts and the latter on digital governance. He argues this paradigm divide shapes the starting point and framing of financing negotiations.

He noted that in the negotiations last year, developing countries focused on developmental impacts while OECD countries focused on digital governance , and that commercial businesses, which are major investors mostly located in the global north, have different investment priorities from governments in the global south, which focus on development .

David Souter argues that investment priorities for individual countries ought to be determined within those countries, in line with national priorities, rather than being resolved by the views, decisions, or priorities of external donors or commercial interests. He raises the question of how this principle can be upheld given the power asymmetries in today's digital environment.

He stated that investment priorities for individual countries ought to be determined within those countries in large numbers, in line with national priorities, not resolved from the views, decisions, or priorities of external donors or commercial interests , and asked how this would work given the power asymmetries in today's digital environment, particularly with AI .

David Souter argues that developing countries already have decades of experience navigating available financial resources, and that the bigger problem is ensuring donors and investors understand those countries' diverse circumstances and recognise their diverse national priorities. He identifies this as the area where the greatest need for help arises.

He noted that developing countries have decades of experience navigating the range of financial resources available to them, and that the bigger problem seems to be ensuring that donors and investors understand those countries' diverse circumstances and recognise their diverse national priorities, identifying this as where the biggest need for help arises .

Céliane Pochon argues that the WSIS architecture, while rich, is genuinely hard to navigate, especially for those with limited capacity, and that a help desk function would serve as a clear single entry point for governments and stakeholders seeking access to financing. She notes there is currently no clear single door for people to knock on.

She observed that there is no clear single door for people to knock on, and that the WSIS architecture is rich but genuinely hard to navigate, especially for those with limited capacity to track every mechanism, fund, and facilitator across the system . She noted the help desk idea builds on a recommendation from the UN Secretary General's high-level panel on digital cooperation, making it not a totally new idea .

Céliane Pochon argues that the proposed help desk should function as a liaison and signposting service rather than a parallel policy advice body, and should not duplicate the work of action line facilitators or other existing technical providers. Its role would be to connect member states and stakeholders to existing financial mechanisms that are currently scattered and poorly visible.

She specified that the help desk would sit as a liaison and signposting service, not a parallel policy advice body, and would not duplicate the action line facilitators or other existing technical providers . Concretely, it would connect member states and stakeholders to existing financial mechanisms - multilateral, bilateral, blended finance, private sector, and partnerships - that are currently existing but scattered and poorly visible .

Céliane Pochon proposes strengthening the existing WSIS architecture through an integrated policy cycle rather than creating new bodies, embodying the principle of integration over proliferation. The cycle would connect the IGF, UNGIS, the WSIS Forum, the Secretary General's biannual report, and ECOSOC in a coherent loop.

She described the proposed policy cycle: the IGF identifies emerging issues and frames the agenda; UNGIS turns this into concrete implementation planning; the WSIS Forum showcases progress; the Secretary General's biannual report builds the evidence base; and CSGD and ECOSOC provide intergovernmental guidance, leading back to the IGF . She also proposed a multi-stakeholder advisory group to complement UNGIS, grounded in the Sao Paulo multi-stakeholder guidelines .

Nandini Chami argues that foundational digital, data, and AI infrastructures require public financing because private and blended finance cannot fully meet the investment gap. She contends that the private sector does not invest in high-risk, low-return projects, which characterises digital infrastructure development for the most vulnerable.

She cited ITU research on financing for connectivity and the UNSD's report on innovative financing mechanisms for AI, which demonstrate that the private sector does not invest in high-risk, low-return projects such as financing digital infrastructure development for the most vulnerable and their human development needs .

Nandini Chami argues that the expected multiplier effect of public investment attracting private capital in blended financing models has not materialised in practice. She draws on evidence suggesting that concessional public finance is instead leveraging non-concessional public finance to support private initiatives, with limited participation from de-risked private capital.

She cited Mariana Mazzucato's evidence in a multi-sector study for UNDESA, which suggests that in practice, concessional public finance is leveraging non-concessional public finance to support private initiatives with limited participation from de-risked private capital .

Nandini Chami argues that global south countries are unable to effectively tax the virtualised business operations of multinational corporations, leading to significant revenue losses. This challenge is compounded as global trade becomes increasingly digital, further eroding the domestic resource base.

She identified the inability of the global south to effectively transform and tax virtualised business operations of multinational corporations as a key challenge, noting it leads to huge loss of revenues, especially as global trade becomes more and more digital .

Nandini Chami argues that increasing dependence on foreign AI models and cloud services creates a rising foreign exchange deficit and risks reproducing a dual economy structure. In this structure, a hyper-productive AI-integrating foreign-owned enclave coexists with a domestic sector forced to suppress wages and under-invest simply to remain viable.

She cited scholar Srimas Raghavendra's caution that as domestic economies' dependence on foreign AI models and cloud AI services increases, there is a rising foreign exchange deficit, risking a dual economy where the economy forks into a hyper-productive AI-integrating foreign-owned enclave and a domestic sector forced to adjust by suppressing wages, operating on thin margins, and under-investing . She noted this is of concern given that 25 out of 54 countries are spending more on interest payments than on health and food security .

Nandini Chami argues that there are no easy solutions to bridging the public finance gap for digital development, but that returning to blended financing approaches that have failed is not the answer. She calls for solutions that recognise fiscal justice as digital justice.

She stated that it is clear we cannot go back to the tired playbook of blended financing that has failed, and that we need solutions which recognise that fiscal justice is digital justice .

Mehdi Snene argues that digital transformation financing discussions must remain connected to real outcomes on the ground, such as job creation, better education, and improved health planning. He contends that the vision and final outcome of financing discussions should be these tangible development results.

He argued that we should not disconnect these realities from the discussion, meaning the vision and final outcome should be how to bring digital transformation to the ground in terms of job openings, better education, and better health planning . He referenced the COVID-19 crisis as a turning point that changed the vision of digital transformation across the global south, illustrating how countries were forced to confront digital infrastructure needs in order to roll out vaccination campaigns and manage social benefits .

Mehdi Snene argues that even the poorest countries are increasingly accelerating the scaling up of digital public infrastructure adoption, and that many countries previously left behind are now putting significant domestic budgetary efforts into digital transformation. He presents this as evidence that countries have recognised the return on investment from digital development.

He observed that from a Global Digital Compact perspective, even the poorest countries are still accelerating the scaling up of adoption of digital public infrastructure , and that many member states who had been isolated and fully left behind are today putting a lot of domestic efforts in terms of budgeting and implementing digital elements because they have seen from multiple other experiences how the return on investment can bring more job openings, better education, and better health planning .

Mehdi Snene argues that the notion of national sovereignty over data and AI is increasingly driving countries to prioritise digital transformation domestically. He presents sovereignty as an additional motivating factor, on top of development needs, that is pushing countries to invest in digital infrastructure.

He noted that as a national priority, the notion of national sovereignty when it comes to data and AI is being added on top of digital transformation priorities , and that this is contributing to countries putting domestic efforts into budgeting and implementing digital elements .

Mehdi Snene argues that the UNGIS interagency task force should adopt a bottom-up approach, starting from what is happening on the ground and building upward, rather than imposing top-down frameworks. He draws on the experience of the Secretary General's work on innovative financing and voluntary options for AI capacity building as a model.

He described the work done at the Secretariat on the Secretary General's Innovative Financing and Voluntary Options for AI Capacity Building Development, which reviewed multiple use cases on how to implement AI from compute to data collection to capacity building . He recommended a bottom-up approach - starting from what is on the ground and what is happening, then building on top of that - as a way to get a better and faster impact on the ground .

Rob Floyd argues that the scale of external debt service payments in African countries so vastly exceeds their digital economy budgets that there is simply not enough public finance to support digital development. He uses specific country-level data to illustrate the severity of this structural constraint.

He provided specific data points: in Nigeria, external debt service is 18 times the budget of the Ministry of Digital Economy; in Kenya, debt service is 45 times the ICT sector budget; in Uganda, it is 54 times the digital transformation budget; and in Tanzania, it is 64 times the budget of the ICT ministry .

Rob Floyd argues that in Africa, low tax-to-GDP ratios that limit domestic resources are not primarily a technical challenge but a political one. He contends that where there is influence over governments, advocacy for increased domestic resource mobilisation should be pursued.

He noted that for Africa, domestic resource tax-to-GDP ratios are generally low, in contrast to some parts of Asia and Latin America where they are relatively high, and characterised this as not a technical challenge but a political challenge, calling for influence on governments to increase domestic resource mobilisation .

Rob Floyd argues that there is simply less development finance in the system today, compounded by a higher cost of capital, particularly as emerging middle-income countries access the Eurobond market while carrying high debt loads. He frames this as a structural constraint on digital development financing.

He noted that the cost of capital is higher than it has been in the past, particularly as emerging middle-income countries go to the Eurobond market, and that there are high debt loads . He contextualised Nandini Chami's point about debt service exceeding health budgets by applying it specifically to digital budgets across four African countries .

Rob Floyd argues that strong support for ongoing global financial architecture reform — including work on debt, taxation, and the UN Convention on Global Taxation — is essential to lower the cost of capital and increase domestic resources for digital development. He presents this as a collective push that stakeholders in the room can contribute to.

He called for strong support for ongoing global financial architecture reform, including work around debt and taxation, and specifically mentioned the United Nations Convention on Global Taxation that is underway, noting that UNDESA and African member states at the UN are working on this .

Rob Floyd argues that institutional investors such as pension funds, insurance companies, and sovereign wealth funds represent a huge untapped bucket of resources that are currently underinvesting in domestic digital development. He contends these institutions could redirect a significant portion of their assets towards digital development within existing prudential rules.

He gave the example of Ghana, where pension funds invest only 1% of their balance sheets in alternative assets when prudential rules would allow up to 25%, suggesting this could very much be directed into digital development . He also noted that 11 African multilateral financial institutions have a collective balance sheet of $70 billion that could be better coordinated and directed at least in part towards digital investment .

Rob Floyd argues that the 11 African multilateral financial institutions, with a collective balance sheet of $70 billion, represent a significant opportunity if they coordinate better and become more innovative in directing resources towards digital investment. He presents improved coordination among these institutions as an underutilised lever.

He noted that there are 11 African multilateral financial institutions, and that if they would coordinate better and be more innovative, there is a collective balance sheet of $70 billion that could be invested at least in part in digital development .

Rob Floyd argues that efficiency gains in the use of existing budgets across developing countries represent a significant untapped resource for digital development. He contends that digital development itself can be a key driver of these efficiency improvements.

He stated that across developing countries, efficiency of the budget is very low and that there are huge gains to be made, particularly in digital development .

Rob Floyd argues that while ministers of finance generally have a good understanding of available financing avenues and instruments, ministries of ICT and digital economy often lack this expertise because they are frequently run by people from the tech industry rather than international development professionals. He contends a help desk targeted specifically at these ministries would be of huge value, particularly in Africa.

He observed that working with ministers of finance on a daily basis, they have a pretty good sense of what is available and what the instruments are, but that ministries of ICT or innovation or digital economy are often run by people from the tech industry or innovation ecosystem who simply do not have the wealth of experience of having worked in international development their entire professional career . He concluded that something targeted specifically to them would be of huge value, particularly in Africa .

Carlos Rey-Moreno argues that at the macro level, financing flows predominantly into large transactions, multilateral deals, and big operators such as fibre backhaul, tower companies, and data centres, creating a fundamental mismatch with the needs of communities. He acknowledges these investments are important but argues they are insufficient on their own.

He noted that at the macro level, money is mostly flowing into large transactions, multilateral deals, national funds, financing big operators, fibre backhaul, tower companies, and data centres , and that while these are important and do contribute to closing the digital divide, they are not enough .

Carlos Rey-Moreno argues that with more than two billion people still unconnected, achieving meaningful connectivity for excluded communities requires financing a much wider ecosystem of models beyond large-scale infrastructure. He draws on ITU resolutions and the Digital Infrastructure Investment Initiative to support this point.

He cited the ITU and the Digital Infrastructure Investment Initiative as having pointed out the need for complementary approaches, and referenced ITU resolutions stating that if we want meaningful connectivity for the communities that are still excluded - more than 2 billion people today - we need to finance a much wider ecosystem of models .

Carlos Rey-Moreno argues that blended finance approaches at the micro level, channelled through specialised intermediaries, can help close the digital divide at community level. He distinguishes this from the macro-level blended finance approaches that have been criticised for failing to deliver.

He described APC's work with support from FCDO and SIDA looking at how blended finance approaches at the micro level, channelled through specialised intermediaries, can really help close the digital divide, and noted there is evidence of this in other sectors .

Carlos Rey-Moreno argues that the real issue is not a competition between micro and macro financing approaches but the need for a financing bridge between them. He calls for mechanisms that can translate macro-level capital into support for smaller, community-led, and locally-rooted solutions.

He stated that the tension is not really between micro and macro as if there were two competing worlds, and that the real issue is that we need a financing bridge between them - mechanisms that can translate macro-level capital into support for smaller community-led and locally-routed solutions .

Lauren Bieniek argues that the global digital infrastructure financing gap is estimated at $2.6 to $2.8 trillion when accounting for hard infrastructure, digital upskilling, affordability, and policy and regulatory support. She notes this gap is growing as connectivity thresholds rise and the true cost of reaching the most remote populations becomes better understood.

She described the ITU's Digital Infrastructure Investment Initiative, launched in 2024, which estimated the digital infrastructure investment gap at $1.6 trillion focusing on hard infrastructure . The 2025 Connecting Humanity Action Blueprint expanded this to $2.6 to $2.8 trillion by also accounting for demand-side factors including digital upskilling, affordability, and policy and regulatory support . She noted the gap is growing not because more people are getting disconnected but because the cost to close the divide is actually growing as technology costs are better understood and connectivity thresholds rise .

Lauren Bieniek argues that the ITU's foundational work identified the need for small-ticket financing opportunities for Internet service providers as a complement to large-scale infrastructure financing. She expresses cautious optimism about blended finance if domestic public resources serve as the concessional layer.

She noted that in the foundational work of the Digital Infrastructure Investment Initiative, the need for small-ticket financing opportunities for Internet service providers was identified, addressing many of the challenges Carlos Rey-Moreno mentioned . She expressed being more optimistic about blended finance if government and domestic public resources serve as the concessional layer, creatively leveraging universal service funds and other public resources to bring national-level attention and leverage .

Lauren Bieniek argues that domestic public resources such as universal service funds and spectrum auction revenues can serve as the concessional layer in blended finance models, helping to leverage private or DFI investment based on national priorities. She presents this as a more promising approach than relying on development finance as the concessional layer.

She suggested that if government and domestic public resources are put as the concessional layer - creatively leveraging universal service funds and other public resources - this can bring national-level attention and leverage to attract private or DFI investment based on national priorities for small-ticket or other financing vehicles . She also highlighted innovative ways to raise financing from spectrum auctions, taxation, tax breaks, and government purchasing power as part of the equation .

Lauren Bieniek argues that innovative ways to raise financing — including spectrum auctions, taxation, tax breaks, and government purchasing power — should be part of the equation for closing the digital divide. She also emphasises the importance of better demonstrating the return on investment from digital development to help governments prioritise and protect these resources.

She highlighted innovative ways to raise financing from spectrum auctions, taxation, foregoing taxes and tax breaks, as well as the purchasing power that governments can bring to the table to anchor demand for networks . She also argued for better sharing of data and calculation of return on investment so that governments can continue to invest in digital development .

Lauren Bieniek argues that the ITU's Digital Infrastructure Investment Catalyzer platform, launched jointly with UNCTAD, can be leveraged by the UNGIS task force and would welcome the help desk idea to improve visibility into country pipelines. She presents the Catalyzer as a coordination platform bringing together multilateral development banks, DFIs, private sector tech companies, and civil society.

She described the Digital Infrastructure Investment Catalyzer, launched by ITU and UNCTAD at the Financing for Development Forum in Sevilla and part of the Sevilla Platform for Action, as a platform for coordination across multilateral development banks, DFIs, private sector tech companies, and civil society . She stated this platform can be leveraged by the task force and that they would welcome the help desk idea, as a big challenge is visibility into country pipelines and knowing the entry point to help further develop and scope projects .

Deniz Susar explains that the UNGIS interagency task force on financing has a specific mandate derived from paragraph 67 of the WSIS+20 outcome document, which tasks it with assessing gaps and challenges and making concrete recommendations. She notes that the mandate also gave ITU a new role as Secretariat of UNGIS to coordinate the task force.

She stated that the starting point is paragraph 67 of the WSIS Plus 20 outcome document, with a mandate that is quite specific, asking ITU as the Secretariat of UNGIS - a new designation - to coordinate the task force . She confirmed the task force is in place and set up, though yet to have its first meeting .

Deniz Susar argues that the task force must work to understand where financing gaps really are, as they differ significantly across countries and sectors. She calls for disaggregating the data to the extent possible to produce evidence-based and contextually relevant recommendations.

She stated that the task force needs to understand where the financing gaps really are, noting they are not the same in every country - in some cases it is connectivity, sometimes it is digital skills - and called for doing their best to disaggregate the data .

Deniz Susar argues that member states, particularly from the G77, have high expectations for concrete and practical recommendations from the task force, as the establishment of the task force was a major ask from developing countries during the WSIS+20 negotiations. She emphasises the need to produce something practical that developing countries can use.

She noted that the WSIS+20 outcome was a big ask from developing countries and the G77, and that member states want to see something concrete, requiring the task force to come up with practical examples and recommendations . She also noted that the government dialogue under the IGF and the task force were among the issues discussed until late at night during negotiations, indicating the high stakes involved .

Deniz Susar argues that the task force should avoid duplication, build on what already exists, and learn from existing initiatives such as the CIVIS proposal. She frames this as essential to producing recommendations that are genuinely concrete and useful.

She called for reading on what already exists and thanked the CIVIS initiative, suggesting it is good to identify what works, where gaps remain, and how to help countries navigate, and that the idea proposed by CIVIS colleagues deserves serious consideration . She summarised the task force's approach as: assess the real gaps, avoid duplication, learn from existing work, and produce recommendations that are really concrete .