The Overseas development institute (ODI) has released their annual report, Climate finance for cities: How Can International Climate Funds Support Low Carbon Resilient Urban Development. Succintly, the report concludes that transport is a key factor in urban development and has been the focus of climate financing from institutions since 2010.
The report states that the way in which cities develop over the coming decades will play a major role in determining the success of climate change mitigation efforts and the degree to which climate change impacts those at risk. Yet most cities in the developing world face severe barriers to planning and financing the infrastructure investments necessary to steer their growth in a climate compatible way. International public climate finance is a fraction of total financial flows, but has the potential to play a pivotal role in helping municipal governments and other urban actors overcome the many barriers they face.
The annual report paper reviews the approaches taken by multilateral climate funds in the period 2010-2014 to support low-emission and climate-resilient development in developing country cities. It identifies US$842 million in approved climate finance for explicitly urban projects, which equates to just over one in every ten dollars spent on climate finance over these five years. The majority of this finance has supported low-carbon urban transport systems in fast-growing middle-income countries. Adaptation funds financed only a handful of explicitly urban projects in the review period.
The figure presented below gives an overview where financing has been focused in the years 2010-14 with transport getting the “lions share” of 60% (US$ 503 million) of finance approved by climate funds for urban projects:
Furthermore, the report highlights the following key findings on climate finance in relations to the transport sector:
- Global annual investment in transport infrastructure accounted for US$ 1.2 – 2.4 trillion in 2013
- Between 2010 and 2014, 60% (US$ 503 million) of finance approved by dedicated climate funds for urban projects was to support urban transport projects in 14 countries (see figure above)
- Seven large CTF project supporting urban transport investments account for 6% of the total climate finance approved for over 700 projects between 2010 and 2014.
The ODI annual report, in full, can be downloaded here.