World Bank Group President Robert B. Zoellick today joins senior officials from the Government of Singapore to launch a new global urban strategy that will guide Bank advisory services and financing in the sector over the next decade.
The launch comes at the inaugural World Bank–Singapore Infrastructure Finance Summit, a landmark event organized by the World Bank Group, the Singapore Ministry of Finance, and the Monetary Authority of Singapore, in association with the Financial Times. The Summit highlights the importance of urbanization as a defining phenomenon of this century. In the next two decades, cities are projected to expand by another two billion people, while 90 percent of urban population growth is expected to occur in the developing world. Developing countries need assistance in facing this historically unprecedented pace of urbanization, including anticipatory policies and financing for urban services.
“Urbanization is a vital phase of development, and if managed well, it can be a key driver of long-term economic growth in a country. Climate change, jobs, poverty, education, health, infrastructure – these are all development challenges closely intertwined with cities,” said Zoellick. “That’s why it is so important for the global community to help developing countries address the urbanization challenge. It is fitting to launch our Urban Strategy in Singapore, a world-recognized leader in urban planning.”
Countries that are able to harness the economic energy of urban growth are also able to reduce poverty and stimulate their economies. China and Vietnam are two examples of countries that invested heavily in regions with large populations. In Vietnam, urban poverty has been reduced by an impressive 11 percent a year over a 10-year period and in China, more than 50 percent of GDP is now generated in coastal cities representing only 20 percent of its territory.
The new Urban and Local Government Strategy aims to work with developing countries as they take advantage of the economic opportunities associated with rapid urbanization. The strategy offers a number of tools to help cities better manage urban growth, including:
- Planning and preparation. The strategy advocates careful planning and preparation, particularly in low-income, least-urbanized countries in Africa and South Asia where the risk of expanding slums and increased poverty is high if actions are not taken. The Bank’s Urbanization Review offers client countries the ability to examine demographic trends, impacts on land and housing affordability, mobility, and other key urban planning criteria. The Bank’s Urban Planning Audit helps client cities assess urbanization pressures and adjust regulations to enable more compact cities, which can also expand the housing supply and reduce infrastructure costs per household.
- Putting the Poor on the Map. The strategy calls for scaled-up approaches to urban poverty, which is growing across most developing regions, by applying GIS technologies to identify, map and better target the urban poor at a city-wide and national level. The Bank would support this work through vulnerability assessments, among other tools.
- Building sustainable cities. The strategy includes the Bank’s ECO Cities Program, which helps developing countries manage cities that are ecologically and environmentally sustainable. It also provides impetus to retrofit and redevelop existing areas. Using an ECO Cities Audit, cities can develop a baseline diagnosis of their current status and determine what steps need to be taken.
- Expanding reach and coverage. Urban population growth is greatest today in secondary cities. The Bank recognizes the growing diversity of its clients and the need to expand reach and coverage to more cities than ever before. The Bank will pursue “wholesaling” strategies on a larger scale to target an expanding number of cities by working with financial intermediaries and Municipal Funds for assistance to local governments.
The global launch of World Bank’s Urban Strategy from Singapore highlights the emergence of Singapore as a regional hub for knowledge on urban management. Building on Singapore’s extensive city management and public-private partnership experience, the first set of joint projects enabled by the World Bank-Singapore Urban Hub collaboration, were also announced at the Summit today.
Singapore's Minister for Finance, Mr. Tharman Shanmugaratnam said, “As a city-state, Singapore has learnt many lessons in urban management, often after years of experimentation. This is an exciting partnership with the World Bank, which will allow us to share what we have learnt with others at a time of massive urbanization in Asia. ”
The Singapore Cooperation Enterprise (SCE) and the World Bank will be signing Memoranda of Understanding (MOU) with the respective Governments of Mongolia and Vietnam, and the Municipal Government of Chongqing, China. Under the arrangement SCE will provide Singapore expertise to assist these governments in developing a regulatory and financing framework to prepare public-private partnership (“PPP”) projects for private sector investment. The cooperation will focus on development of commercially viable infrastructure projects in water and environmental management, power, expressways and roads. World Bank and SCE will also jointly organize knowledge-sharing workshops to share Singapore’s public and private sector expertise, experiences and best practices in structuring PPP infrastructure projects.
The three projects are:
1) Advisory services to Chongqing Expressway Group Company Ltd, China in structuring a transaction to sell toll-roads to international investors.
2) Capacity-building in Southern Mongolia to support PPPs in developing mining infrastructure.
3) Advisory services in Vietnam for the development of the Financing Framework for PPPs, and assistance in identifying and preparing of pilot transactions.
It is anticipated that these projects will lead to more collaboration on downstream projects with the respective countries that will in turn open up more opportunities for Singapore’s private sector players to assist the countries as investors and advisors.
The World Bank–Singapore Infrastructure Finance Summit – the first of an annual series – is being organized under the auspices of the newly established World Bank-Singapore Urban Hub and comes amid a massive new infrastructure push in Asia. The Summit will feature a series of presentations from finance ministers, mayors and other central and local government policy makers, as well as senior executives representing private investors, advisors and practitioners, which will showcase innovative infrastructure financing structures and models being undertaken by central and local governments. The Summit establishes a pioneering platform for governments across Asia to present their initiatives to the market, and for the private sector to learn about new investment opportunities. It also highlights Singapore's emergence as a regional and international hub for infrastructure financing and expertise on urban development