Page 13 - U4SSC Compendium of practices on innovative financing for smart sustainable cities projects

Introduction

Achieving the SDGs requires an increase in investments. Given that in many countries there is a
growing need to spend in social and economic infrastructures while facing budgetary constraints,
developing innovative ways to finance SDG-related projects is becoming more crucial. This is
particularly true for low- and middle-income countries. Innovative finance, including the use of
public-private partnerships (PPP) can help to close the financial gap by providing additional sources
to finance projects in municipalities and bringing the expertise of the private sector into project
cycle. Innovative finance can supplement limited public sector capacities in providing infrastructure
and services.

This was highlighted by the United Nations Secretary General Antonio Guterres during the High-
Level Meeting on Financing the 2030 Agenda for Sustainable Development held on 24 September
2018, wherein he released a financing strategy that emphasized the critical role of the United
Nations in supporting and accelerating the mobilization of project finance. It focused on three
objectives to accelerate progress, from global to local levels: (a) align global financial and economic
policies with the 2030 Agenda; (b) enhance sustainable financing strategies and investments, at
country and regional levels; and (c) seize the potential of financial innovations, new technologies
and digitalization, to provide equitable access to finance.

This Compendium of Practices on Innovative Financing was developed as a part of the United
for Smart Sustainable Cities Initiative (U4SSC) by its thematic group on Innovative Financing
Instruments for Smart Sustainable Cities, coordinated by the United Nations Economic Commission
for Europe (UNECE). The publication builds on the previous U4SSC deliverable, Guidelines on tools
and mechanisms for smart sustainable cities

U4SSC is a global United Nations initiative coordinated by ITU, UNECE and UN-Habitat and
supported by CBD, ECLAC, FAO, UNDP, UNECA, UNESCO, UNEP, UNEP-FI, UNFCCC, UNIDO,
UNOP, UNU-EGOV, UN-Women, UNWTO and WMO to achieve Sustainable Development Goal 11:
“Make cities and human settlements inclusive, safe, resilient and sustainable”. U4SSC serves as the
global platform to advocate for public policy and to encourage the use of ICTs to facilitate and
ease the transition to smart sustainable cities. 1

Methodology

The compendium is based on principles and approach outlined in the “U4SSC Guidelines on tools
and mechanisms to finance sustainable smart cities projects”, published in August 2021. Both
documents promote implementation of the 2030 Agenda for Sustainable Development and the
Addis Ababa Action Agenda of the Third International Conference on Financing for Development.

1 United 4 Smart Sustainable Cities. Available at https:// u4ssc .itu .int/ .

Compendium of practices on innovative financing for SSC projects | January 2023 1