The handbook presents an up-to-date, comprehensive, and in-depth analysis of the challenges posed by rapid urbanization and the financing tools municipalities have at their disposal.
The handbook provides city leaders with a range of financing solutions that emphasize sustainability, inclusion and financial autonomy.
An estimated US$3 trillion to 4 trillion is required annually to achieve the SDGs and cities play an important role in closing this financial gap, note the authors.
9 April 2018: The UN Human Settlements Programme (UN-Habitat) has launched a resource guide on municipal finance, highlighting the importance for implementation of the New Urban Agenda (NUA) and the SDGs, particularly SDG 11 (sustainable cities and communities). The handbook provides city leaders with a range of financing solutions that emphasize sustainability, inclusion and financial autonomy, aiming to contribute to discussions on how cities can finance large capital expenditures, infrastructure maintenance and operation, and public services.
The resource titled, ‘Finance for City Leaders Handbook,’ includes analyses, presentations and training materials, related to challenges posed by rapid urbanization and the financing tools municipalities have at their disposal. The information is presented in an interactive manner for use as a training tool for strengthening municipal finance to facilitate the mainstreaming of such finance into capacity building exercises. The publication stresses that an estimated US$3 trillion to 4 trillion is required annually to achieve the SDGs, and that cities play an important role in closing this financial gap.
The publication includes three sections on: principles of municipal finance; designing financial products; and cross-cutting issues. The first section highlights: tools for raising local revenues; challenges local governments face such as insufficient and unreliable transfers from central government, poor tax collection and weak fiscal management; mechanisms on how to improve outdated governance systems, enhance revenues and build better local financial asset management systems; and fiscal decentralization as an important part of sustainable and autonomous municipal finance.
The second section, on designing financial products, discusses: non-tax tools for generating own-source revenues; credit-worthiness and its importance to cities in establishing long-term financial sustainability and receiving improved terms of financing from the capital market; green municipal bonds as an effective financing tool and challenges to obtaining them; the importance of pooled financing for small to medium-sized cities to be able to access long-term and fairly priced debt; the pros and cons of public-private partnerships (PPPs); Islamic municipal finance and different types of Islamic bonds; the role of real estate development in developing cities; and tools for improving capital markets for municipal finance in the least developed countries (LDCs).
The third section, on cross-cutting issues, explains how financing participatory slum upgrading promotes inclusive urbanization, adequate living conditions and prosperity for all, and highlights UN-Habitat’s Participatory Slum Upgrading Programme. It also: addresses how youth, gender and human rights relate to municipal finance and why they matter for city leaders, particularly to achieve the SDGs; and introduces a local economic development methodology to help city leaders stimulate economic growth, promote competitive sectors and generate jobs. [UN-Habitat News Story] [Publication: Finance for City Leaders Handbook] [Section on Principles of Municipal Finance] [Section on Designing inancial Products] [Section on Cross-cutting Issues] [UN-Habitat Participatory Slum Upgrading Programme]