A United Nations body is offering $40,000 for the best designed affordable housing for low-income workers at an industrial zone in Cambodia’s capital, as part of its strategy to encourage investment in sustainable development worldwide. The U.N. Development Programme’s SDG Impact Finance (UNSIF) aims to create 3,000 units of housing in a Special Economic Zone (SEZ) on the outskirts of Phnom Penh, which is growing rapidly as people migrate from the countryside for jobs.
The competition taps into the U.N.’s 17 Sustainable Development Goals (SDGs) that aim to tackle the world’s most challenging problems, from halting deforestation to reducing child mortality.
UNSIF was set up to draw money from the public and private sectors – including governments, corporations and venture philanthropists – to help fill a massive financing gap in achieving the SDGs. “UNSIF is led by the conviction that social good and profit making need not be mutually exclusive,” said David Galipeau, chief impact officer at UNSIF in Bangkok. “If there is a solid business plan for development opportunities, companies are happy to invest,” he told the Thomson Reuters Foundation.
The U.N. estimates that achieving the set of global targets by 2030 will require $5 trillion to $7 trillion. The investment gap in developing countries is about $2.5 trillion. Set up in 2016, UNSIF reflects the growing popularity of investments aimed at environmental and social benefits. The $114 billion market is expanding about 18 percent a year, according to non-profit Global Impact Investing Network.
Achieving the SDGs could create $12 trillion in market opportunities in the areas of food and agriculture, cities, energy and health, and generate some 380 million new jobs, according to the Business & Sustainable Development Commission. “Corporations are realising that capital creation is not just about wealth,” said Galipeau, who has a background in commodity trading and corporate finance, and was a dot-com entrepreneur in the 1990’s. “Every organisation can be a social enterprise,” he said, referring to business with a social purpose.
Among the initiatives UNSIF has launched are a $100-million fund for affordable housing in Bangladesh – the country’s first domestic impact fund – and a fund of the same value for social housing in India. Also in India, a $1 billion scheme will provide debt capital for agriculture, renewable energy and financial services.In Cambodia, investments will go toward facilities in the Phnom Penh SEZ, including low-cost homes for workers, as well as renewable energy.
With younger populations, newly-minted billionaires and growing numbers of women heading businesses, Asian nations can take the lead in social impact investing, Galipeau said. “They know what it means to be poor, so they are more open to ideas on how to spend the money in ways that can do good.”