Akinwumi Adesina, President of the African Development Bank (AfDB), has expressed a strong commitment to the development of cities and emphasized the need for increased investment and autonomy for municipalities.
Speaking at a high-level forum for mayors titled “Leveraging Cities and Municipalities for National Development,” held on the sidelines of the Africa Investment Forum (AIF) 2023 Market Days in Marrakech, Morocco, Adesina highlighted the crucial role cities play as engines for economic growth.
The forum brought together mayors and governors from major African cities, including Lagos, Dakar, Addis Ababa, Abidjan, Kigali, and Nairobi, along with representatives from governments, financial institutions, and development organizations.
The event aimed to launch new collaboration between financial institutions, cities, states, and municipalities to accelerate Africa’s growth and development.
A new report commissioned by the African Development Bank, titled “From Millions to Billions: Financing the Development of African Cities,” was presented during the session. The report underscores the rising urban population in Africa, expected to nearly triple in the next 25 years, reaching 1.5 billion inhabitants by 2050.
To address this challenge, African countries are estimated to need to invest about 5.5% of their annual GDP in their cities, approximately $140 billion per year.
Adesina outlined four ways to attract private investments into cities, including providing greater autonomy and fiscal responsibility to cities, using debt securities for financing, developing better mortgage financing for affordable housing, and providing additional regulatory space for raising financing on local capital markets through municipal and green bonds.
Adesina also announced approvals by the African Development Bank’s Board of Directors, including the Urban and Municipal Development Fund (UMDF), with $50 million mobilized for the period 2023-2027, to support urban project preparation, urban planning, and municipal access to financial support ecosystems.
Additionally, the African Development Bank will provide projected lending of approximately $2 billion in 2024 to support cities and municipalities.
The Africa Investment Forum will prioritize bankable projects for cities, dedicating special sessions to cities as a permanent agenda.
This commitment signals a concerted effort to prioritize and support urban development initiatives across the continent.