All for sustainable urban infrastructure brings economic and social gains. For they also are creating prosperous, livable cities.
Scaling up investment for sustainable urban infrastructure:
A guide to national and sub-national reform was issued. To launch the report, there is also a launch event Friday with a panel featuring:
- Minister Bambang Brodjonegoro (Minister of National Development Planning of Indonesia)
Professor Lord Nicholas Stern (Co-Chair, Global Commission on the Economy and Climate and IG Patel Professor of Economics and Government, LSE)
Professor Ehtisham Ahmad (Senior Fellow, ZEF, University of Bonn and GRI, London School of Economics, Chinese Academy of Fiscal Science/Ministry of Finance Research Institute. Also Pao Yu-Kong Professor, Zhejiang University)
Dr Andrew Steer, President and CEO, World Resources Institute
Helen Mountford (Vice President for Climate and Economics, WRI and Program Director of the New Climate Economy)
Chair: Ani Dasgupta (Global Director, WRI Ross Center for Sustainable Cities and Global Co-Director, Coalition for Urban Transitions)
Cities and towns are expanding rapidly.
So by 2050 two thirds of the population will live in urban areas.
Delivering on the Sustainable Development Goals (SDGs) and the Paris Agreement on Climate Change will require coordinated policy actions. That’s as well as major investments at the national and sub-national levels.
They are creating clean, compact, and connected cities. All that would play a major role in generating sustainable growth. That’s including improving air quality and public health, enhancing accessibility and safety. Also as a result will be reducing poverty. As well as avoiding the costs of sprawl. Finally, all while reducing carbon emissions.
Currently the gap for sustainable urban infrastructure in cities exceeds US$1 trillion a year.
So this report recommends a coordinated or systems approach to scaling up financing for sustainable infrastructure in cities. Because “Traditional approaches” to urban finance have often focused on actions that cities can take. That’s such as issuing municipal green bonds or securing a good credit rating.
In addition, the paper argues that mobilizing private financing at scale. Scale through the effective deployment of a range of new financing instruments. It requires a greater focus on a systemic approach to urban finance reform. So including national and subnational domestic resource mobilization. As well as improved governance, and sustainable management of liabilities.
- The paper sets out a two-step framework to illustrate how national and subnational governments can systematically strengthen their urban finance systems:
- get the basic tax system right: create fair and efficient national and sub-national tax systems that systematically incentivize more sustainable and inclusive growth and investment in cities.
These could include: carbon pricing to incentivize low-emission urban development and property taxes which promote more efficient use of urban land rather than costly sprawl, complemented by fair and equitable systems of income tax and VAT, potentially with ‘piggy-backed’ arrangements to generate revenues at the local level.
These suggestions can lay the foundations for capturing the wealth generated by dynamic urban economies that – in the long run – generate higher tax receipts as well as reduce greenhouse gas emissions from construction, transport and land use change.Step two – mobilize private finance: complement the fiscal agenda above by deploying a range of financing instruments to crowd in key private sector investment.
Potential instruments include debt financing. For example, through the use of ‘green bonds’ to distribute the public costs of sustainable urban infrastructure investment equitably over time;well designed public-private partnerships which can secure private sector capabilities in the design, construction and management of large sustainable infrastructure projects; and land-based financing instruments. All to therefore harness the interrelationships between more productive use of land and rising land values.
Because that’ll unlock financing for sustainable urban infrastructure such as mass transport systems.
Decision-makers need to pay far greater consideration to a range of preconditions for the policy, institutional, investment and credit environment to ensure that these mechanisms are deployed in a fair and sustainable way.
The paper can help economic and financial decision-makers consider how to reform and strengthen both fiscal and finance systems to raise the scale of resources needed to fund core services and invest in sustainable urban infrastructure.
So therefore mobilizing finance for sustainable infrastructure as recommended in the paper will enable national and local governments to build prosperous, low-carbon, compact, connected and coordinated cities.
Notes to Editor
The paper is at: https://newclimateeconomy.
The research was conducted by Ehtisham Ahmad, LSE; Dan Dowling and Denise Chan, PwC; and Sarah Colenbrander and Nick Godfrey, Coalition for Urban Transitions.
The Coalition for Urban Transitions is a major global initiative to support national governments. All to therefore accelerate economic development and tackle dangerous climate change by transforming cities. It provides an independent, evidence-based approach for thinking about how to manage urban areas, and the accompanying process of economic, social, and environmental transformation, to maximize benefits for people and the planet.
In conclusion, the Coalition is a special initiative of the New Climate Economy and jointly managed by the C40 Cities Climate Leadership Group (C40) and World Resources Institute (WRI) Ross Center for Sustainable Cities. It brings together major institutions spanning five continents, including research institutions, city networks, international organisations, infrastructure providers, and strategic advisory companies and is guided and championed by an Urban Leadership Council.
initiative funded with UK Aid from the UK government. However the views expressed do not necessarily reflect the UK government’s official policies.