Cities as an Opportunity to Advance a Regional Sustainable Development Agenda

This article was published in Infobae

Cities play an increasingly pivotal role in the fight against climate change. Globally, they concentrate more than half of the population and are responsible for 70 percent of greenhouse gas emissions worldwide. As a result, Latin America needs a different approach in the economic and urban development model to move towards the construction of more sustainable communities. Although boosting productivity is one major pending task in the region, cities in Latin America and the Caribbean cannot continue to develop under models that have proven obsolete in terms of environmental protection and rational resource consumption.

Therefore, CAF—development bank of Latin America—aims to promote a vision of sustainable urban development that puts people at the center and rethinks the link between societies and nature. We aspire to become the green bank of Latin America and the Caribbean by the end of the decade, and expect at least 40 percent of our approvals in 2026 to finance adaptation and mitigation projects that improve climate resilience in our region.

In this context, we work towards the preservation of biodiversity, building sustainable habitats and improving urban management, in line with the Sustainable Development Goals (SDGs)—specifically SDG 11, “Sustainable Cities and Communities.” For example, we have developed the BiodiverCitiesNetwork, to which 94 local governments throughout Latin America have already adhered, in order to create spaces for the exchange of knowledge, experiences and best practices that help promote economic growth in harmony with nature.

We are also financing infrastructure mega-projects that help improve the quality of life of the people of the region. These include notably Paseo del Bajo in Buenos Aires, where we disbursed USD 400 million to exponentially improve urban mobility and provide a structural solution to problems such as traffic congestion and environmental pollution. In addition, we have granted three loans for a total of USD 332 million to encourage a comprehensive transformation of the Brazilian city of Fortaleza, helping enhance leisure spaces, boost commercial activity and implement multiple road projects. In addition, through non-reimbursable funds, we have collaborated to help structure plans with an environmental focus, such as the Rimac River Special Recovery Project, which is expected to improve the environmental quality of the surroundings of the watercourse where families in the Historic Center of Lima reside.

Similarly, we participated this week in the C40 World Mayors Summit, in Buenos Aires, which brought together more than 100 community leaders from cities around the world, who reflected, exchanged ideas and best practices around curbing emissions, the transformation and creation of green jobs, and access to financing to address the energy transition. In the closing panel of the meeting, which also gathered representatives of international organizations, regional banks and other local authorities, I had the opportunity to raise three issues that are central for CAF in the collaboration between financial institutions to promote climate actions in cities.

First, coordination as a fundamental pillar to establish multilateral work in Latin America and the Caribbean. The financing by regional organizations (CAF, World Bank, IDB, FONPLATA, Central American Bank, among others) is around USD 65 billion, and we know that closing the gaps in infrastructure and development prevailing in Latin America and the Caribbean requires some USD 600 billion every year. Thus, we need to ensure coordinated work that creates the greatest possible impact, prevents overlapping of programs, and moves towards increasing efficiency.

Second, the importance of a paradigm shift that promotes systems of environmental protection and care, and at the same time fosters a rational consumption of resources. Currently, more than 2 billion people in the world lack access to basic water and sanitation services, and thus, it is essential to advance transformations and changes in our habits in order to address the climate crisis. In the case of use of water resources, for example, it is important to move from a vision of abundance to a vision of water management efficiency.

And, Lastly, the importance of working together with local governments to move towards sustainable urban management in Latin America and the Caribbean. Local governments are closest to the people, listen to their claims, their complaints, proposals, and can better channel the concerns they receive to turn them into real policies that promote real changes.

Noteworthy is that there is no sustainable urban development without social development. Land use planning in cities should always include a space justice approach that promotes greater balance and, above all, create fairer, more resilient and inclusive urban development models.