Making cities resilient: The need for financing sustainable urban development

As the Philippines tops the list of countries most vulnerable to climate change and disasters, more and more cities are taking steps to strengthen resilience in their localities. These resilience actions need investments to be implemented and development gains to be realized.

Just this October 2023, the Albay Provincial Government declared a State of Climate Emergency where the LGU committed to encourage renewable energy investment in the province’s energy sector; discourage the use of liquefied natural gas and other fossil fuels as primary energy sources; urge financial institutions to create clear roadmaps to immediately discontinue support for fossil fuel projects; implement circular and sustainable development in all aspects of work; and implement an action plan for the local government that addresses ecological challenges.

This is timely as Albay partners with the Strengthening Institutions and Empowering Localities Against Disasters and Climate Change in the Philippines (SHIELD), a program implemented through a consortium of partners supported by the Australian Government that aims to accelerate local resilience-building.

Albay’s declaration is similar to Makati City’s proclamation of a State of Climate of Emergency in August 2022 by Mayor Abby Binay, who was also recently named among the members of the COP28 (2023 UN Climate Change Conference) Advisory Committee.

World Cities Day focuses on financing sustainable

This year’s World Cities Day (October 31), with the theme “Financing sustainable urban future for all”, explores how localities can unlock transformative investment in urban planning and identify concrete tools available for cities to unlock financing for sustainable urban development.

“The time for action is now. We need to invest in our urban future. We need a new financing framework to unleash the potential of our cities,” said UN-Habitat Executive Director Maimunah Mohd Sharif in a statement.

She also emphasized that there is a need to invest in integrated planning and turbocharge global commitment to shelter and housing as a human right.

United Nations Secretary General Antonio Guterres, in observance of World Cities Day, stated that cities are engines of economic growth and innovation that hold the key to achieving the 2030 Agenda and the Sustainable Development Goals (SDGs).

“I am a strong advocate for equitable financing solutions at the global level.  These must be used, together with innovative and diverse funding sources, to strengthen local financing strategies that are climate-friendly, inclusive, and equitable,” Guterres further explained.

Financing solutions for cities

Earlier this month, UN-Habitat Philippines and the Department of Human Settlements and Urban Development (DHSUD) jointly tackled this issue during the Philippine Urban Forum (PhUF) held on October 5-6, at the Philippine International Convention Center (PICC) in Pasay City.  

A plenary session  attended by LGU stakeholders, representatives from financing institutions and government agencies discussed challenges, issues, and solutions revolving around access to funding for urban development projects to address climate change.

In this session entitled “Financing Sustainable Urban Development”, Asian Development Bank (ADB) Principal Urban Development Specialist Alan Baird elaborated on the importance of financial sustainability of cities.

This was followed by a panel discussion focusing on opportunities how LGUs can access funds for their climate resilience projects. The panel was composed of Smart Cities Network Vice-Chairman Syed Mubarak, ADB Cities Development Initiative for Asia (CDIA) Urban Development Specialist Lara Arjan, Development Bank of the Philippines (DBP) Senior Vice President and Head of Development and Resiliency Sector Carolyn Olfindo, Landbank Program Management Department Manager Ronaldo Averion, Jean Paula Regulano of the Climate Change Commission, DHSUD Environmental, Land Use and Urban Planning and Development Bureau Director Mylene Rivera, and Department of Transportation Assistant Secretary Leonel De Velez.

Ormoc City Planning and Development Coordinator Engr. Raoul Cam also shared how their LGU was able to tap the Cities Engagement Facility with the support of UN-Habitat’s Building Climate Resiliency through Urban Plans and Designs Project.

In a parallel PhUF session, the League of Cities of the Philippines organized a Mayors’ Roundtable Discussion on Financing Resilient Urban Economies. The discussion revolved around financing options for resilient housing. Mayors, NGAs, and city representatives discussed updating of schedule of market values to raise property taxes, explored socialized housing tax as a new revenue source, and introduced more strategic partnerships with the private sector to consolidate income sources.

Photo by League of Cities of the Philippines

LCP National Chairman and Bacolod City Mayor Albee Benitez and LCP Vice President for Luzon and Balanga City Mayor Francis Garcia both shared experiences on governance and revenue generation for sustainability.

As an ongoing effort, the SHIELD Programme, a UNDP-led consortium with partners UN-Habitat, Philippine Business for Social Progress, National Resilience Council, and the Consortium of Bangsamoro Civil Society, will strengthen LGU capacities to accelerate resilience-building efforts at the local level by collaborating with multiple stakeholders to unlock financing, invest in resilient development, and implement risk-informed and inclusive resilience actions. As a SHIELD consortium partner, UN-Habitat is responsible for capacitating LGUs in risk-informed planning, investment programming and budgeting as well as supporting LGUs to access funds at the national and local levels.

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The Future of Asian & Pacific Cities Report 2023 entitled, Crisis Resilient Urban Futures, is a comprehensive analysis and assessment of sustainable urban development in the Asia and Pacific region at a time of great disruption and uncertainty resulting from multiple interlinked global crises in a post-pandemic era.

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