Nature Positive Financing the Tranisition in Cities

Cover: 1-Pact Edition. Images: Getty Images Disclaimer This document is published by the World Economic Forum as a contribution to a project, insight area or interaction. The findings, interpretations and conclusions expressed herein are a result of a collaborative process facilitated and endorsed by the World Economic Forum but whose results do not necessarily represent the views of the World Economic Forum, nor the entirety of its Members, Partners or other stakeholders. © 2025 World Economic Forum. All rights reserved. No part of this publication may be reproduced or transmitted in any form or by any means, including photocopying and recording, or by any information storage and retrieval system.Contents About the Nature Positive Transitions series 3 Foreword 4 Executive summary 5 1 Global urbanization and the nature opportunity for cities 6 1.1 Protecting and restoring nature in a rapidly urbanizing world 7 1.2 Aligning on a definition for nature finance 8 2 Nature finance in urban development 10 2.1 Making space for nature in urban development finance 11 2.2 Nature mainstreaming in cities 12 2.3 Nature-positive finance in cities 14 2.4 Overcoming funding gaps 15 3 Shaping nature finance in cities: a spotlight on MDBs 16 3.1 The relationship between MDBs, urban development and nature 17 3.2 Carving space for cities and nature in MDB reforms 17 3.3 State of MDB urban nature finance 18 3.4 MDBs’ progress in mainstreaming nature 21 3.5 Streamlining assessment processes and evaluation frameworks for “nature positive” 22 3.6 Major funding mechanisms and the opportunity to further mainstream nature 23 3.7 Increasing nature finance in cities 25 4 Challenges with nature finance in cities 26 4.1 Limitations to nature finance in cities 27 4.2 Limitations in cities’ enabling environment 27 4.3 Emerging initiatives and progress 30 5 Addressing the limitations of nature finance 32 5.1 Strengthening regional and local government awareness and capability 33 5.2 Assessing opportunities to mainstream nature within existing processes and policies 34 5.3 Adopting a structured collaboration mechanism through which MDBs can easily engage with city governments 35 5.4 Using MDB creditworthiness programmes, guarantees and partnerships with credit rating agencies 36 5.5 Using non-sovereign-backed loans 37 5.6 Using blended finance and partnerships with the private sector 37 Conclusion 38 Appendix 39 Contributors 41 Endnotes 44