The theme of this year’s World Cities Day, “Inclusive Cities, Shared Development”, reminds us of the important role urbanization playsin advancing development and social inclusion.

From our perspective, World Cities Day should not only be about iconic skylines and megacities. Instead, getting urbanization ‘right’ in the world's 48 Least Developed Countries (LDCs) is central to the world’s ability to meet not only SDG 11, but the other SDGs too. Two weeks ago at the Habitat III Conference, Member States adopted the New Urban Agenda, which promotes a vision for cities that are just, safe, accessible, resilient and sustainable. By reemphasizing the way cities and human settlements are planned, designed, financed, developed, governed, and managed, the New Urban Agenda seeks to help to end poverty, reduce inequalities, and promote inclusive and sustainable economic growth.

UNCDF was proud to contribute to this process together with our partners representing secondary cities in developing countries. By 2050, two-thirds of the global population will live in urban areas, with nearly 90 per cent of the increase concentrated in Asia and Africa, including in LDCs. Many secondary cities in LDCs are growing at a rate of 5-7 percent annually, as a result of natural demographic growth and domestic migration. Yet, these cities often lack the financial resources and capacities to meet the growing demands they face to provide quality public services, jobs for young people, and climate-resilient infrastructure. Local governments in LDCs often have weak local revenue bases, and decentralization systems typically devolve responsibilities without the resources required to deliver on those responsibilities. Transfers from central government are important sources of local finance but alone are insufficient to bridge the financing gap.

This is why making finance work for secondary cities – for example by ‘localizing’ more financial flows like climate adaptation funding, and innovating new financial instruments that empower municipalities - is so important in addressing the challenges and taking advantage of the opportunities posed by urbanization. 

The New Urban Agenda calls for supporting innovative financing frameworks and instruments and enabling strengthened municipal finance and local fiscal systems in order to create and share “the value generated by sustainable urban development in an inclusive manner”. In support of this imperative, UNCDF is developing and testing out financial models which mobilize domestic resources to meet local needs so that secondary cities in LDCs can become engines of inclusive growth, benefiting from and contributing more to shared development. This includes seeking to promote the sustainability of urban investment by linking it to the nationally determined contributions of LDCs to the Paris Agreement, which can unlock climate finance for local governments.

On this World Cities Day, UNCDF commits to implementing the New Urban Agenda and to helping to build cities that improve the lives and livelihoods of all their inhabitants.