Manila, 2 February 2024 – The Smart Green ASEAN Cities (SGAC) Programme held a meeting on urban financing experiences, and projects from cities, private sector, and development banks to strengthen coordination, partnership, and collaboration on smart and green initiatives at the national level.

Led by the Environment Management Bureau (EMB) in the Philippines, and organized by the United Nations Capital Development Fund (UNCDF), officials from the Department of Interior and Local Government, Department of Environment and Natural Resources Foreign-Assisted and Special Projects Service (DENR-FASPS), Public Private Partnership (PPP) Center, Local Government Unit (LGU) representatives, Land Bank of Philippines, Asian Development Bank (ADB), and UNDP Philippines joined the meeting to share experiences on financing, projects and synergies of smart and green initiatives at the sub-national levels.

Ms. Esperanza Sajul, Assistant Director of the EMB, opened the meeting by saying that they looked forward to this EU-ASEAN partnership. “With the Philippines being one of programme beneficiaries, cities will be supported to access private financing” she said. She hoped that the meeting would allow the cities and the invited stakeholders to share experiences, lessons learned, and identify partnership for the cities’ projects and further strengthen coordination and synergy.

SGAC beneficiary cities of Samal, Puerto Princesa, and Calapan presented their projects to enhance their public service delivery, particularly on waste treatment and management. Confronted by dwindling resources, increasing population and urban growth, the cities acknowledge the need to explore alternative financing and partnering with private sector on urban finance. However, the challenges lie in the limited capacity of the cities to design viable projects and finding private sector partners.

“Mobilization of private sector financing are the key pillars for development” stated Mr. John D Zafe, Director IV of Project Development Service, PPP Center, Manila. He also highlighted the tight fiscal space and increasing aspiration from the national and subnational governments and the private sector to be the key for sustainable development. The PPP Center said that they provided cities with Project Development and Monitoring Facility (PDMF) support to enhance the investment environment and develop viable project pipelines at sub national levels.

Furthermore, Mr. Ronaldo Averion as the representative of Land Bank of the Philippines, a government-owned entity, emphasized the changing trends in service delivery and partnering with local governments as critical. The Bank’s Smart City Development Financing Program is being applied to projects in infrastructure, transportation, healthcare, energy, technology etc. to reduce the financing gap of the cities in urban development.

The Asian Development Bank representative pointed out the need to think beyond PPP financing to address the gaps in sub-national financing.

“There is a need for strong commitment from the municipalities to take advantage of the opportunities while improving their capacities in governance, transparency, and fiscal management,” said Ms. Lara Arjan

SGAC shared the different financing mechanisms (i.e. grants, blended finance, city guarantees, loans, bonds) that UNCDF utilizes to support sub-national government to unlock additional and catalytic funding. SGAC will partner with the three cities to build capacity, develop financial/investment models and build synergy and partnership between governments and private sector.

The advanced fiscal and political decentralization policies in combination with active public private partnerships (PPP) implementation allows the cities a multitude of opportunities to access additional financial resources to service the different sectors. By bringing together the national and sub-national governments as well as external partners, the meeting reinforced the interest of private sector and banks to work with the sub-national governments to develop different investment models and to unlock additional resources to bridge the funding gap for urban development and reduce environmental impact.

About SGAC: The Smart Green ASEAN Cities Programme is funded by the European Union and implemented by UNCDF in partnership with the ASEAN Secretariat in Jakarta, Indonesia.

SGAC works with sub-national governments to catalyze financing from the private sector and design innovative financing mechanisms to address environmental and climate change impacts. Through seed financing grant, technical and capacity development support, the programme aims to identify green and smart city solutions and design appropriate financing mechanisms in collaboration with the local governments. SGAC is implemented in 15 cities selected from the eight ASEAN members states (Cambodia, Indonesia, Malaysia, Thailand, Laos, Vietnam, Philippines, and Myanmar).

For further information contact: Amadou Sy Communications Officer at UNCDF amadou,sy@uncdf.org; website: https://www.uncdf.org/