Ten Prescient Thinkers on Local Development Finance and the Approaches to Accelerate COVID-19 Recovery
The first season of Capital Locast has just concluded. This podcast series featured conversations with ten leading thinkers who have contributed to a deeper appreciation of the role of local government finance in international development.
Capital Locast advocates for a global financial ecosystem that works for cities and local governments. The series is driven by the work of United Nations Capital Development Fund (UNCDF) and United Cities and Local Governments (UCLG).
All ten episodes are freely available on your podcast provider of choice.
The conversations took place immediately prior to COVID-19 pandemic’s worldwide impact. Nevertheless, the interviews make fascinating listening now because they are so prescient on the importance of local government finance to meaningful, healthy and sustainable livelihoods – a lesson that the novel Coronavirus is teaching us.
The economic recovery from the impact of the COVID-19 lockdown will be tough for some countries. The climate emergency remains real. The scale of the plastics problem is only just starting to be understood. The world’s response to these development challenges are Agenda 2030 and the 2015 Paris Agreement – agreements between nation states. But the development finance architecture is missing something. Local Governments are the indispensable agents to solving these problems. Whilst national governments, civil society and the private sector can achieve a lot, without a revolution in local government finance it will be impossible to build a sustainable liveable world. UNCDF aims to re-purpose local government finance as an accelerator of global development. Capital LoCAST is talking local, globally.
Season 1: Episode 1. Raghuram Rajan - former Chief Economist at the International Monetary Fund, former Governor of the Reserve Bank of India and currently Professor of Finance at University of Chicago School of Business. Professor Rajan is author of The Third Pillar: How the State and Markets are leaving Communities Behind 2019. Raghuram was one of the few leading economists to forecast the 2008 financial crisis. We talk to Professor Rajan about the crucial role of local governments in national development and how capital markets can open up to local government finance. We touch upon national markets and also the international financial architecture and how it can be made more friendly to local government finance.
Season 1: Episode 2. Gillian Tett - US Managing Editor and member of Editorial Board at the Financial Times, author of Fool's Gold: How Unrestrained Greed Corrupted a Dream, Shattered Global Markets and Unleashed a Catastrophe, 2009 about the highly leveraged financial instruments traded prior to the 2008. Gillian analyses the anthropology of decision making and the importance of avoiding group think. Gillian’s recent book is The Silo Effect: The Peril of Expertise and the Promise of Breaking Down Barriers, 2015. We talk to Gillian about why, despite their potential to accelerate development, local governments are often ignored by global and national decision makers when formulating economic development policy.
Season 1: Episode 3. John Tomaney - Professor of Urban and Regional Planning at the Bartlett School of Planning, University College of London, co-author of Local and Regional Development, 2017. Professor Tomaney has provided expert evidence to OECD on regional development strategies and advised governments worldwide. John explains that whilst everything happens somewhere, not everything impacts positively on local development. Local economic development means more than simply investing in a local area. We discuss how economic theory is often spatially blind and ignores the geographical or territorial dimension with examples of good and bad practice in managing transitions to sustainable local economies.
Season 1: Episode 4. Rajivan Krishnaswamy - Rajivan is a former CEO of the Tamil Nadu Urban Development Fund in India and former Senior Urban Finance Specialist at the World Bank. Rajivan tells us that the form of the financing shapes the form of the city and stresses the importance of building capital markets and fiscal systems that provide a blend of financing. A full mix of financial options is necessary to produce resilient and inclusive urban futures. Rajivan outlines how intergovernmental fiscal transfers and own revenues are equally important to private sector funding. Importantly, Rajivan distinguishes between the types of private funding and their pros and cons for different urban development objectives.
Season 1: Episode 5. Francis Zinsou - Former Permanent Representative of Benin to the United Nations and former negotiator on behalf of the Least Developed Countries at the 2015 Financing for Development conference which produced the Addis Ababa Action Agenda – the global agenda for development finance which includes an enhanced recognition of the private sector as a development actor alongside public funding of Overseas Development Assistance. Local governments were excluded from early drafts of Addis, which only referenced a role for central government, civil society and the private sector. Ambassador Zinsou’s advocacy led to paragraph article 34 which recognises the role of local government finance.
Season 1: Episode 6. Jesper Steffensen - Senior Partner of DEGE Consult and a leading expert on fiscal transfers from central to local governments and author of the UNCDF publication Performance Based Grants, Best Practice and International Experience, 2010. Jesper outlines how all countries, from the wealthy to the poorest, operate some form of fiscal transfer of government revenue to local authorities. This is necessary for a functioning state system and is a redistribution of the national wealth to citizens across the whole territory that generated the wealth in the first place. Jesper explains how embracing intergovernmental fiscal transfers can accelerate national development.
Season 1: Episode 7. Honorable Lamin Dibba, Minister of the Environment, Climate Change and Natural Resources, Government of Gambia. Gambia has recognized that fiscal transfers from central to local government can significantly accelerate Gambia’s adaptation to climate change and boost the resilience of its local economies. Gambia also recognizes the relevance of local government finance for transboundary river basin management and for for addressing the challenge of rapid urbanization. Gambia has joined the Local Climate Adaptive Living Facility, a 23-country initiative, governed by its members, that channels of climate finance to local governments through fiscal transfer mechanisms. Honorable Dibba explains Gambia’s approach
Season 1: Episode 8. Brock Carlton, Chief Executive Officer of the Federation of Canadian Municipalities. Brock believes that “Cities and towns build nations; they just need the power.” Under Brock’s leadership the FCM has become a major factor in Canada’s development path - from strategic partnerships with central government to managing pooled investment funds. Brock tells us how the FCM has evolved to play such a major role, how it unites the interests of large cities such as Vancouver, Toronto and Montreal with small rural towns and how it has contributed to the unity of a country as diverse as Canada. Brock also details how Canada is pioneering the role of municipalities as international development actors.
Season 1: Episode 9. Jean Pierre Mbassi – Secretary General of United Cities and Local Governments – Africa. The future is already here – the scale and speed of African urbanization is striking. It is a phenomenon taking place so fast that conceptions of rural Africa are already outdated. How will Africa finance the jobs, mass public transportation, clean energy, drinking water, affordable housing, parks and public utilities for a beautiful urban future? And how will Africa do this in the face of the climate emergency? This is THE issue for African development right now – yet insufficient attention is being paid to it. How can local government finance become a channel for African development finance? Jean Pierre discusses these challenges.
Season 1: Episode 10. Emilia Saiz – Secretary General of United Cities and Local Governments – World Secretariat. UCLG the world’s leading local government body, its members represent over 200,000 local governments worldwide. Emilia is a leading global advocate for the role of cities in development and has been instrumental in raising the profile of UCLG, bringing cities and local governments to the table at forums that were previously the domain of central governments, the private sector and civil society only. UNCDF has joined with UCLG to create the coalition for a global financial ecosystem that works for cities and local governments. To close the first season of Capital Locast, we discuss the next steps for our coalition.
In Season 2 of Capital Locast, city leaders and their central government counterparts will present practical examples of how they are leading the recovery from the COVID19 pandemic. Coming soon…
Capital LoCAST is presented by David Jackson, Director of Local Development Finance at the United Nations Capital Development Fund.