The International Finance Corporation (IFC), the private sector arm of the World Bank, has joined forces with the government of Switzerland to launch the second phase of the Sustainable Cities programme. This strategic collaboration aims to support the development of green urban infrastructure in emerging markets, providing essential assistance to subnational governments and private sector partners.
The Sustainable Cities programme, scheduled to run from 2023 to 2027, is focused on attracting crucial investments and financing for essential urban infrastructure projects across various sectors, including transport, water, wastewater, solid waste, and district energy. The ambitious goal of this programme is to facilitate over $500 million in commercial financing for sustainable urban projects through non-sovereign loans, municipal bonds, and public-private partnerships (PPPs).
Switzerland's State Secretariat for Economic Affairs (SECO) is contributing $19 million in support, building upon its previous backing of the programme. The first phase of IFC's Sustainable Cities programme, from 2018 to 2022, achieved nearly $400 million in financing, with 87% of the investments directed towards climate-related projects. Over 1.7 million people have benefited from the programme, which financed projects in more than ten cities worldwide, including Bogota, Casablanca, and Ekurhuleni.
Dagmar Vogel, head of the infrastructure financing division at SECO, expressed excitement about the renewed partnership with IFC, stating, "IFC's Sustainable Cities programme is well-aligned with our priority development areas and our mission to support green urban infrastructure in emerging markets. We are pleased to renew our long-standing partnership with IFC, demonstrating SECO's strategic approach to engaging the private sector in key partner countries and regions."
The Sustainable Cities programme closely aligns with the World Bank's climate change action plan, designed to increase climate finance, strengthen climate change adaptation, and align financial flows with the Paris Agreement on Climate Change. Additionally, it supports IFC's broader strategy to unlock new markets, develop bankable projects, and mobilise private sector solutions and investments in emerging markets. Part of the funding from SECO will be dedicated to supporting Ukraine's reconstruction efforts, leveraging donor and public funds while catalysing private investment.
Sumeet Thakur, IFC's global head for cities, water, and waste, emphasized the significance of the Sustainable Cities programme, stating, "Cities and metropolitan areas remain powerhouses of economic growth. However, they face a series of challenges in the context of rapid urbanisation and climate change. These challenges have amplified existing urban issues and need to be addressed through ramped-up investments in sustainable infrastructure, including subnational borrowing and public-private partnerships."
The second phase of the Sustainable Cities programme promises to further advance green urban infrastructure in Switzerland and beyond, creating a lasting impact on the development of sustainable and resilient cities worldwide. The collaboration between IFC and Switzerland sets the stage for innovative solutions and investments that will shape the cities of the future, enhancing the quality of life for millions of people while addressing the pressing challenges posed by climate change and rapid urbanisation.
With this renewed partnership, the world is witnessing a powerful commitment to sustainability and a shared vision for a greener, more prosperous urban future. As the programme unfolds, it will continue to drive transformative change in emerging markets, paving the way for a world where cities are not only economic powerhouses but also beacons of environmental stewardship and resilience.
