Nature Positive Financing the Tranisition in Cities

A multilateral approach to urban development is fundamental. National governments, subnational governments, private sector financial institutions and companies, non-government entities and international organizations such as MDBs all contribute to making cities liveable and prosperous. To appropriately involve all these stakeholders and to elicit the greatest impact for nature, local economies and people’s well-being, nature finance must be addressed through its two opportunity fronts: nature mainstreaming and nature-positive finance. Addressing existing limitations to cities’ enabling environments will also help local governments unlock strong MDB bilateral arrangements, which catalyse private sector funding. Six opportunities can help cities increase their nature-positive footprint within their urban bounds and embed nature across all processes. (see Figure 9). Strengthening regional and local government awareness and capasbilityAssessing opportunities to mainstream nature within existing processes and policiesAdopting a structured collaboration mechanism through which MDBs can easily engage with city governmentsUsing MDB creditworthiness programmes, guarantees and partnerships with credit rating agenciesUsing non-sovereign backed loans Using blended finance and partnerships with the private sectorOpportunities for strengthening nature finance in cities FIGURE 9 Source: World Economic Forum analysis. As cities continue to urbanize, they will have to consider nature-based solutions as a low-cost and effective form of infrastructure. Urban growth and expansion will continue to have a deleterious effect on the natural systems that cities depend on. At present, project developers struggle to convey the values and co-benefits of financing nature as urban infrastructure, and argue that greater awareness among financiers is necessary. Understanding the impact of urban development on nature, and the risks associated with nature loss, will enable cities to implement mechanisms to embed nature in project evaluations and cross- sector city initiatives. Opportunities for cities Cities can increase their awareness and technical knowledge of nature infrastructure solutions and the added values and co-benefits of investing in nature by: –Developing context-specific training programmes for staff, using information gained through a baseline assessment of current capabilities across government. –Forming partnerships with other cities through global communities such as C40 or the African Natural Capital Alliance to promote learning and collaboration. –Increasing nature-related training and skill development among public sector employees. –Hiring environmental, biodiversity and ecology specialists to advise on infrastructure development initiatives. –Establishing knowledge-sharing platforms and partnerships to promote government strategies and objectives and share progress. 5.1 Strengthening regional and local government awareness and capability $7 trillion is invested globally each year in activities that have a direct negative impact on nature from both public and private sector sources. Nature Positive: Financing the Transition in Cities 33