The African Development Bank (AfDB) is launching the Municipal CFO Initiative in partnership with the United Cities and Local Governments (UCLG). This new mechanism, which will be implemented from September 2022, will enable African cities to strengthen their sources of financing for infrastructure projects in order to accelerate sustainable urban development on the continent.
Between population growth and global warming, the need for sustainable urban development is increasingly felt in Africa. In this context, a new mechanism of the African Development Bank (AfDB) called “Municipal CFO Initiative” will allow municipalities to strengthen their sources of financing for the implementation of their infrastructure projects and at the same time, improve their creditworthiness.
In concrete terms, the programme, which will start in September 2022, will equip municipal finance actors with accounting, debt and risk management skills, thanks to the intervention of experts working on the stock exchanges of Johannesburg in South Africa and Abidjan in Ivory Coast. According to François Paul Yatta, the director of programmes of the United Cities and Local Governments (UCLG), which supports this AfDB project, it will also be a question of understanding the ecosystem of investors interested in African cities.
“There is an urgent need for urban infrastructure to evolve and develop to meet the demands of Africa’s rapidly urbanising cities. This type of programme is a catalyst that will make municipalities important interlocutors for a large number of donors,” explains the head of urban development in the Infrastructure, Cities and Urban Development Department of the AfDB. According to Alice Nabalamba, the first phase of the “Municipal Finance Managers Initiative” will target ten municipalities spread across the continent’s sub-regions, including Southern, Central, East, West and North Africa.
Accelerating urban and sustainable development
Ultimately, this financing facility will facilitate the implementation of the AfDB’s Action Plan for Urban and Sustainable Development which is in line with the commitments made by local government leaders and economic actors during the 9th edition of the Africities Summit held in May 2022 in Kisumu, Kenya. These commitments include the promotion of green mobility, the creation of green jobs, the improvement of plastic waste management systems and the renovation of housing in African municipalities.
Meanwhile, the South African government, in partnership with the German Agency for International Development Cooperation (GIZ) and the United Nations Development Programme (UNEP), has provided municipalities with an essential financing manual for investing in climate change mitigation and adaptation projects. The book is already enabling city leaders to determine the environmental and economic impact of green bond issues on the South African economy.