High level panel on the development of a Multidimensional Vulnerability Index

The international community has now acknowledged vulnerability as a serious obstacle to development
due to the damage caused by exogenous shocks and stressors to which countries are increasingly being
exposed. These shocks span diverse domains such as terms of trade fluctuations, natural disasters,
supply disruptions, conflicts, civil unrest, and unprecedented shocks such as the COVID-19 pandemic.
It is evident that low national income, often measured by Gross National Income per capita (GNI pc),
is a weak measure of development, material welfare, or well-being. This is particularly true for countries
facing high risks of external shocks and stressors, especially if they also lack resilience. However, there
is currently no international, widely accepted, quantitative benchmark to measure structural vulnerability
or lack of resilience across multiple dimensions of sustainable development at the national level.
Access to concessional financing windows generally depend on meeting lower income thresholds
(GNI pc). This means that countries who do not meet this threshold but may be vulnerable often lack
access to affordable development support such as concessional assistance to help them meet their
sustainable development goals while coping with, and adapting to, their structural vulnerabilities. A widely
accepted Multidimensional Vulnerability Index (MVI) has the potential to better guide country development
and donor assistance policies, aid in the diagnosis of development challenges and in the identification
of nations in need of heightened international assistance before a crisis hits.

The work of the High Level Panel on the Development of a MVI (hereafter, the Panel) seeks to fill this
gap. The Panel, which began its work in March 2022, took a systematic approach to consultation and
outreach, gathering inputs and suggestions from diverse stakeholders including potential user groups,
academics, and Member States. This Report summarizes the results of the Panel’s deliberations and
offers recommendations.

The proposed structure of the MVI aligns with the guidance provided by the United Nations (UN)
Secretary-General’s Report (A/76/211, paragraphs 80-83), while incorporating an additional component
the Vulnerability-Resilience Country Profiles (VRCP). This two-tiered structure provides:

A quantitative assessment of structural vulnerability and resilience using a common methodology
for all developing countries. The assessment is presented via a summary index number to rank countries
and a dashboard showing individual country scores on the component parts (the MVI score); and

A more detailed, tailored, and individualized characterization of a country’s vulnerability and resilience
factors, including non-structural resilience prepared by individual countries (the VRCP).

In developing the MVI index, the Panel followed a set of guiding principles and parameters provided by the UN
Secretary-General’s Report (A/76/211, paragraph 81) as follows:

Multidimensionality: Indicators used should cover all three dimensions of sustainable development,
i.e. economic, environmental, and social.

Universality: the design of the index should capture the vulnerabilities of all developing countries
to ensure credibility and comparability.

Exogeneity: The index must clearly differentiate between policy-induced and exogenous
(or inherited) factors to reflect the structural and inherent challenges faced by countries,
independent of the political will of their governments.

Availability: The index should use available, recognized, comparable, and reliable data.

Readability: The design of the index should be clear and easily comprehensible.

It should be noted that the primary objective of the MVI index is not to reflect overall progress toward
the Sustainable Development Goals (SDGs), but to provide a robust, acceptable, and simplified assessment
of vulnerability that can be effectively operationalized by and for the benefit of vulnerable countries.