Financing Sustainable Urbanization: Counting the Costs and Closing the Gap

While we know that cities can be drivers for the achievement of Agenda 2030, lack of sufficient finance for investment in infrastructure and sustainable development prevents urban populations from reaching their full potential and increases the overall costs of municipalities. One obstacle for unleashing adequate finance is that there is a lack of understanding on the basic costs of a city. This necessitates a comprehensive costing estimation for SDG 11 on sustainable urbanization.

There is also a lack of capacity to cover such costs, partly stemming from inadequate awareness of the total financing capacity currently available and how to access it. This report presents an innovative pilot on how to count the costs for achieving SDG 11 developed by UN-Habitat and AidData. It furthermore presents UN-Habitat estimations on the total SDG and infrastructure investment gap as well as the total private and public financing capacity available. Finally, the report discusses possibilities for bridging the investment gap for SDG 11 and urban infrastructure, with a special emphasis on how local governments can access the currently underutilized institutional investor capacity.