Financing Cities
All over the world, cities have voiced their need to increase and diversify their financial resources in order to localize the Sustainable Development Goals.
However, the imperative of financing cities has been characterised by a market failure (i.e. a mismatch between the supply and demand for financing). Depending on the context, it is necessary to identify opportunities to mobilise additional resources.
This requires reforms of the institutional environment, to strengthen the capacity of local governments to develop innovative financial models and prepare attractive and investable projects and the strengthening of public or private financial intermediation at national or local level, etc.
Cities can meet these challenges by exchanging experiences and solutions with their peers, but also with all partners in the urban finance ecosystem: national governments, donors, investors, the private sector and civil society.
Voice of practitioners
Rémy Rioux
Geoffrey Makhubo
Thierry Déau
Rémy Rioux
Chief Executive Officer of the French Development Agency (AFD)
AFD is contributing to the development of sustainable cities, with a €1.6 billion in 2020 budget. AFD does so through a broad range of financial instruments, including direct loans to local governments or intermediated financing through public or private banks, guarantee mechanisms, grants, etc. AFD organized "Finance en commun" - the World Summit of public development banks - to demonstrate the major role of these institutions in financing global sustainable development agendas.
Geoffrey Makhubo
Executive Mayor of the City of Johannesburg
The City of Johannesburg has been a pioneer in financing the climate transition. It was the first city in the world to issue a green bond and is currently preparing to issue Africa's first ‘pooled green bond’. Its climate action plan is integrated into all its policies and budgetary choices. It plans to invest USD 1.8 billion in green infrastructure by 2030.
Thierry Déau
Founder and CEO at Meridiam
Meridiam is a leading private investor in sustainable cities. It has incorporated the SDGs and climate impact measurements into all of its investment procedures. For cities in developing countries, Meridiam is introducing blended finance vehicles with technical and financial partners. Meridiam manages the International Municipal Investment Fund (IMIF) launched by UNCDF, UCLG and FMDV.