Artificial Intelligence Budgeting

Successful risk-informed SDG-financing solutions depend on prudent public financial planning and management, and budget execution. Yet, all financial decisions confront an anomaly of risks, both explicit- where finite public funds contend with diverse SDG priorities, and implicit- when funds spent to advance an SDG collaterally degenerates outcomes on others. Determining how the two risks interact and how the different types of budget expenditures impact SDG performance remains an arduous task for policymakers.

Budgeting for the SDGs (B4SDGs) offers insights on how to optimize public spending efficiency, reduce opportunity costs and wastefulness, and enhance the effective use of domestic public resources. B4SDGs is key for budget planning, delivery, execution, and evaluation cycles and supports the development of evidence-based medium-term revenue and expenditure strategies.

Our approach

ESCWA developed an artificial budget intelligence powered toolkit (iBiT) to amplify the returns on public spending and optimize public expenditure efficiency. The toolkit is also aimed at maximizing SDG performance across a wide spectre of national targets, especially in countries facing severe fiscal space constraints. The iBiT represents a qualitative leap in public financial planning, management and budgeting for the SDGs. It quantitatively assesses the impacts of general government expenditures (direct and indirect) on SDG performance at the national and subnational levels. The iBiT overcomes fiscal space limitations, accounts for country idiosyncrasies, and captures how SDG-budget synergies and trade-offs manifest themselves in different country contexts.

Our partners

Partners include:

• Ministries of Planning, Economic Development, International Cooperation and Finance
• Central banks, national stakeholders and think tanks
• UN Trade and Development (UNCTAD)
• Department of Economic and Social Affairs (DESA)
• United Nations Development Programme (UNDP)
• United Nations Children’s Fund (UNICEF)
• United Nations University World Institute for Development Economics Research (UNU-WIDER)

Our activities

The iBiT provides valuable insights on some of the most pressing questions related to budget planning and execution, spending efficiency, and maximizing progress on national sustainable development ambitions, including:

• Which budget lines are consistently advancing/regressing the SDGs?
• How impactful is the budget spending towards achieving the SDGs?
• What is the cumulative contribution of public spending on SDG performance?
• Is the current budget optimally aligned with and effectively advancing the SDG performance?
• How optimal is the budget change allocation towards advancing the SDGs?
• How to optimize the current spending to maximize SDG outcomes?
• How to optimize the current spending to progress the SDGs and meet constitutional thresholds?
• What is the optimal allocation to advance the SDGs given the need for austerity?
• How much more could the SDGs progress if the additional financing was optimized?
• How much additional resources are needed to meet the SDGs?

(Related resources: Financing for Development Gateway: Financing is about transforming lives not just economies).