Mayors and multilateral banks join forces against climate change

December 07, 2023

At an event during COP28, the mayors of Barranquilla, Santiago de Chile, Dakar, Melbourne, Reikjiavick, Marseille, Bristol and Freetown, among other cities, committed to accelerate adaptation to climate change and expressed their financing needs, which can be solved with the support of development banks. At the meeting, CAF shared its success stories with the subnational governments of the region, with a view to replicating them in the rest of the world.

Mayors and multilateral banks join forces against climate change

Cities have a determining role in the fight against climate change. 56% of the population lives there (80% in Latin America) and they produce 70% of greenhouse gas emissions. Therefore, if cities do not take sufficient mitigation and adaptation measures, it will be impossible to comply with the Paris Agreements.

And to do this they need the support of multilateral development banks to finance resilient infrastructure, environmentally friendly urban centers and urban projects that preserve biodiversity, promote clean transportation systems and promote urban resilience.

“In institutions like CAF we are prioritizing financing to subnational governments, through results-based programs, support in the implementation of projects and participation in large urban initiatives. Multilateral development banks have several competitive advantages, among them that we can attract more direct financing to cities,” said Ángel Cárdenas, manager of Urban Development, Water and Creative Economies at CAF, in his speech at the Global Commission on Finance. Sustainable Developments, of which CAF is co-president, held at COP28 in Dubai.

According to Cárdenas, development banks can also deploy help attract more new co-financing tools and integrate cities into global knowledge networks, and are not affected by exchange fluctuations of local currencies, something that allows access to financing with more attractive rates.

According to Jaime Pumarejo, mayor of Barranquilla, “cities are on the front line against climate change. With CAF we have been working on two very important fronts: generating more capacity in the city to access financing and to finance ourselves directly without a sovereign guarantee and in this way access more and better resources.”

“We don't get anything out of talking so much about climate change if we don't have the financing that reaches the cities and regions that are going to implement these changes. The possibility of multilateral banks, municipalities and non-profit organizations sitting at the same table is the opportunity to influence the international debate on climate change financing,” said Claudio Orrego, governor of the Motripolitana Region of Chile.