Research and analytical services
Understanding urbanization at different scales: The World Bank is conducting a rich set of research on sustainable urban development. At the regional and country scales, the Urbanization Reviews offer a framework for city leaders to identify policy distortions and analyze investment priorities. A series of prototypes have been piloted to build a body of knowledge on urbanization challenges and public policy implications in a variety of country settings, including Colombia, India, Indonesia, and Vietnam. At the city level, City Diagnostics is an informative tool to pursue a shared vision of the city. This includes Transforming Karachi into a Livable and Competitive Megacity, which informed US$876 million of the cross-sectoral investment projects in Karachi.
Other recent analytical work and tools to help cities manage urbanization and support sustainable, inclusive growth include:
- Disasters triggered by natural hazards can strike at a moment’s notice, with devastating consequences on people, infrastructure, assets, and entire economies. And the coronavirus pandemic (COVID-19) fits into this category.
- Beyond its huge health impacts, there are significant economic losses to households, firms, and governments as well as large-scale disruptions to lives and livelihoods as a result of lockdowns, disruption of supply chains, and a steep drop-off in commercial activity as a result of COVID-19.
- For decades, the World Bank and the Global Facility for Disaster Reduction and Recovery (GFDRR) have been helping national and local governments to prepare for and mitigate the impacts of naturally occurring events – floods, droughts, cyclones, earthquakes, tsunamis, and more – investing $5 billion in disaster risk management and urban resilience projects, on average, every year.
- This is because prevention and preparedness make economic sense, from strengthening infrastructure and other risk reduction efforts to developing policies and programs that help safeguard the poorest and most vulnerable against disaster impacts.
- Innovative instruments such as our Development Policy Financing with Catastrophic Draw Down Option (Cat DDO) where, if a disaster due to a pandemic or extreme weather event strikes, countries that had previously prepared and approved a Cat-DDO would have quick access – less than 48 hours – to financing for emergency response.
- The CAT-DDO is a financing instrument that acts a little like a parametric catastrophe bond, in that they provide a source of capital contingent on a disaster being declared in the beneficiary country.
- They are similar to an insurance or reinsurance policy, or a catastrophe bond, except that once triggered the contingent financing facility opens up a loan, or line of credit, to the World Bank.
- Currently 17 countries have the Cat DDO option with a combined value of $2.4 billion (8 Cat DDOs have to date disbursed $1.2 billion and the rest are on the way); 13 more countries are preparing Cat-DDOs.
Financing the New Urban Agenda
The World Bank helps cities and national governments put in place the financial framework to attract investment and grow in a sustainable manner. The Bank is helping countries establish and strengthen urban institutions to deliver improved infrastructure and services, for example:
- In Sub-Saharan Africa, the World Bank has an operational portfolio of almost $1.1 billion in urban projects focusing on improving financial and institutional performance and strengthening decentralization in Ethiopia, Kenya, Senegal, Tanzania, and Uganda.
- In Morocco, a $200 million World Bank loan aims to improve the city of Casablanca’s investment capacity by improving its revenue management systems and attracting private investment to municipal infrastructure and services through public-private partnerships.
Innovative ways of leveraging investment are also needed, including from private and non-traditional sources, such as land value capture, sometimes in combination with multilateral development banks (MDBs) and other agencies; by reforming intergovernmental fiscal transfers; and strengthening municipal finances.
- Through the capital raising strategy of its City Resilience Program (CRP), the World Bank is pushing the boundaries in this area with its Capital Mobilization Strategy, which works with city leaders to consider the Bank a catalyst to development financial solutions beyond World Bank loans. To do so, the program connects cities to co-financing by donors and other international financial institutions (IFIs). The program also supports cities in combining public investment with private opportunities through private sector engagement, where feasible.
- The Resilient City Development Program (RECIDE), a partnership of the Spanish Agency for International Development Cooperation (AECID) and the World Bank, is empowering cities in Sub-Saharan Africa to strengthen resilience, and to access a broader range of financing options. RECIDE has been granted approval to access resources from the EU External Investment Plan of up to EUR 100 million in guarantees and EUR 14 million in technical assistance to source, originate, and execute transactions.
- The City Creditworthiness Initiative (CCI) aims to strengthen the financial performance of local governments and prepare them to tap domestic / regional capital markets without a sovereign guarantee. The initiative has trained over 630 municipal officials from 250 cities in 26 countries.
Promoting territorial development
- The World Bank’s report, East Asia and Pacific Cities: Expanding Opportunities for the Urban Poor, encourages cities in the region to ensure inclusive, equitable urban growth through a multi-dimensional approach to planning, incorporating aspects of economic, spatial, and social inclusion to foster economic growth and reduce poverty.
- Another report, Raising the Bar for Productive Cities in Latin America and the Caribbean, provides a rigorous analysis of the key factors constraining the productivity performance of cities in the region and provides evidence to show how planning, investments and policy reforms to promote a more connected, and, therefore, integrated, urban system can foster economic growth and inclusion.
- A new report, Which Way to Livable and Productive Cities? A Road Map for Sub-Saharan Africa, brings together a large body of analytic work to show that urban livability and prosperity cannot be pursued effectively without distinguishing priorities for larger cities from smaller towns. Lack of institutional capacity in the smaller towns across Africa may require a slower transition of responsibilities for planning and investment management, as well as enhanced technical assistance so that institutions can perform their tasks.
- In Kenya, northern areas of the country have mostly been excluded from the benefits of rising living standards. The World Bank is launching the North & Northeastern Development Initiative (NEDI), a multi-sectoral program with projects in transport, water, energy, agriculture, livelihoods, and social protection to help connect the region to national and global markets.
Enhancing urban resilience to climate change and disaster risks
In recent years, the World Bank has worked in cities and towns across over 140 countries, investing $4.5 billion during FY19 in disaster risk management.
- In Mozambique, the Mozambique Cities and Climate Change Project, funded by $120 million IDA credit, includes a stormwater drainage system whose 11 kilometers of canals and flood control systems to prevent the city from flooding, strengthening the city’s resilience to weather-related hazards. Soon after the Idai and Kenneth cyclones hit that affected millions of people, the port of Beira was back in operation and the city cleaned up, partly thanks to this project. The project also includes solar-powered street lighting, which at one point was the only source of light in the city. To help the cyclone recovery, the World Bank announced nearly $700 million in support for Mozambique, along with Malawi and Zimbabwe. Mozambique received a commitment of $350 million from the IDA Crisis Response Window to re-establish the water supply and rebuild damaged public infrastructure and crops. The financing supports disease prevention, food security, social protection, and early-warning systems in the impacted communities.
The World Bank has also facilitated global partnerships, including with the Agence Française de Développement (AFD) and the Asian Infrastructure Investment Bank (AIIB), to support countries in their urban resilience work.
- Through the CRP, supported by the Global Facility for Disaster Reduction and Recovery (GFDRR), the Swiss Economic Secretariat, and other partners, the World Bank is helping cities around the world raise the finance they need to build resilience to climate change and disaster risks, connect investors with bankable projects, and keep millions of people safer and stronger. The objective of the CRP is to support cities in embedding resilience into investment projects and mobilizing capital beyond World Bank loans. To do so, the program offers support in the planning process and capital mobilization. To support planning, the program engages with the tech community delivering digital tech solutions to better understand the built and natural environment. To support finance, the program engages with an ecosystem of donors, IFIs, and financial advisors to crowd in the necessary market to deliver finance to cities.
- Urban resilience goes hand-in-hand with environmental sustainability. The World Bank’s Global Platform for Sustainable Cities (GPSC) is a partnership and knowledge platform that includes 28 cities across 11 countries that have received $151 million from the Global Environment Facility.
o This support has leveraged $2.4 billion in project co-financing. The platform promotes integrated solutions and cutting-edge knowledge for cities seeking to improve their resilience and overall urban sustainability in the areas of indicators and tools, integrated urban planning and management, and municipal finance.
o One example of GPSC providing solutions and knowledge to cities is the Urban Sustainability Framework. This guidance document developed by GPSC includes the Measuring Frame work that incorporates 177 indicators into a clearly laid out process for cities to track their urban sustainability. The most important 14 “core” indicators are associated with SDG 11.
o By using these core indicators, GPSC helps establish comprehensive multicity data sets tied to each indicator and this in turn helps: track international progress toward SDG 11, allows cities to compare their performance with their peers, and overall enhances knowledge sharing between cities. GPSC is currently utilizing the SDG 11 core indicators to roll-out a benchmarking assessment for more than 30 cities worldwide.
More project results
In Belize, the Bank supported the national government in developing and implementing the National Climate Resilient Investment Plan (NCRIP) through the Climate Resilient Infrastructure Project, which helped position the country to leverage additional climate financing from international financing institutions. In the Eastern Caribbean countries, the Bank has mobilized over $200 million for enhancing climate resilience and strategically reducing their vulnerability to climate change and disasters caused by natural hazards, including $83 million from the Strategic Climate Fund, and immediately following disasters (e.g., Saint Lucia Disaster Vulnerability Reduction Project).
In Colombia, the national government has put forward a series of institutional and policy changes to promote the peace building process. With the support of the World Bank, these efforts focus on strengthening institutions for land management and territorial planning, as well as improving subnational financial management and investment prioritization.
In Georgia, the Regional Development Project assists the country’s regions in improving their infrastructure in order to capitalize on a growing tourism market; thus assisting in improving their local competitiveness and economic development. In Azerbaijan, World Bank loans supported the rehabilitation of the main landfill site and establishment of a state-owned waste management company, increasing the population served by the formal solid waste management to 74% in 2012. Support also led to further sustainable waste management practices, helping achieve a 25% recycling and reuse rate.
In Indonesia, the Indonesia National Slum Upgrading Program, which includes substantial additional finance through co-financing from the Asian Infrastructure Investment Bank (AIIB), is improving access to urban infrastructure and services in targeted slums. In Argentina, the Metropolitan Buenos Aires Urban Transformation Project is supporting the improvement of living conditions for around 48,000 residents in disadvantaged neighborhoods in the Buenos Aires Metropolitan Area.
In Jordan and Lebanon, two related projects are supporting local authorities and communities hosting Syrian refugees, and include strong consultation and feedback mechanisms. The Jordan project to address the urgently needed rehabilitation of municipal infrastructure has benefitted about two million people, including 250,000 Syrian refugees. In Lebanon, interventions to release tensions reached 250,000 people within a year – three times the initial target – particularly those in the host communities close to refugee camps, and also improved service delivery to more than one million Lebanese people.
In Pakistan, the World Bank is helping the five largest cities in the province of Punjab improve their systems for planning, resource management, and accountability through a $150 million results-based financing. The city governments are developing and implementing medium-term, integrated development and asset management plans with evidence-based prioritization for municipal infrastructure and services, resulting in increased revenue collection and reduced expenditures, providing financial headroom. Automated systems for public access to information and grievance redressal, as well as updated websites with information on budgets and procurements, are ensuring greater accountability.
In rapidly urbanizing Vietnam, the Vietnam Urban Upgrading Project – with $382 million financing from the World Bank – improved the lives of 7.5 million urban poor with better water and sewage connections, as well as improved roads, sewers, lakes, canals, and bridges.
Last Updated: Apr 20,2020