Government funding guarantees proposed for urban development
Acting Executive Director of the Institute of Policy Studies, Dushni Weerakoon says that Asian governments had the ability to assist local authorities tackling the issue of swift urbanisation by providing financing guarantees that will enable them to spend on developing their cities to liveable standards.
This view was expressed at the Asian Development Bank (ADB) –Asian Think Tank Development Forum 2017.
According to Weerakoon, many developing nations like Sri Lanka faced the critical hurdle of securing funds since such governments had restricted fiscal areas to embark on ambitious infrastructure projects initiatives.
“Countries in the region need sustainable financing for infrastructure and urbanisation. The private sector has a role to play in investing in energy efficiency and ensuring transport systems are less polluting and in areas like waste management. Governments can also step in and raise access to capital markets for urban bodies by providing guarantees,” she said.
She further added that local authorities could capitalise on the appreciation in property prices as a result of large infrastructure projects and utilise urban planning to rectify problems such as regional congestion and income disparity.
“Today, good planning for urban development means creating sustainable cities that are environmentally-friendly and less resources consuming than in the past. Even Colombo is undergoing a rapid urbanisation process with high-rise apartments, mixed development projects and reclamation of land,” she stated.
Weerakoon pointed out that Sri Lanka’s Western Region Megapolis projectwhich was focused in the Colombo, Gampaha and Kalutara districts would cost an estimated USD 40 billion over a span of fifteen years.
“Emerging economies like India, Brazil and South Africa have floated municipal bonds to raise funds for investment, but mainly in larger cities. Most municipalities don’t have the local tax base in their cities, the tax base being too narrow, and do not have internationally recognised credit ratings to access capital markets.So we have to find different ways to mobilise resources,” she added.
Such a proposal will provide more public-private partnership (PPP) opportunities to further Sri Lanka’s economic development and enhance private sector participation.
|Article Code :||VBS/AT/26092017/Z_4|