Building sustainable infrastructure to support urbanisation and climate change

Rapid urbanisation in recent decades has created many socio-economic advantages with cities and urban areas contributing significantly to economic growth. The growth also introduces several challenges that create severe constraints to sustainable development. The top two critical challenges being ability to attract infrastructure investment and climate change. The current urban population of East Africa is about 132 million. (UN Habitat) The rapid growth in population is putting pressure on urban infrastructure and affecting the way people live and move around in cities. The population in the region is expected to grow to about 418 million by 2050 further straining existing infrastructure and urban-based systems.

Against this backdrop the region must address burgeoning needs of city and urban population through adequate planning for critical infrastructure, which includes consistent supply of energy for households and commercial use, access to clean water, adequate waste management systems and construction and expansion of existing transport systems.

Cities consume a majority of the region’s energy, producing more than 60% of greenhouse gas emissions driven by infrastructure construction and its use, such as buildings and transport, industries and manufacturing plants. Additionally, cities in East Africa are particularly vulnerable because they are characterised by rapidly swelling informal settlements that lack basic infrastructure and services. Such living conditions further expose communities to the harshest impacts of climate change, such as flooding, lack of access to clean water and spread of tropical diseases further exacerbating the challenge of climate change mitigation and adaptation. Governments along with the private sector in the region should work together to create a balance between the required infrastructure for sustainable urbanisation, climate change adaptation and mitigation in economies with competing investment capital requirements

The region as a whole needs to take action to support, review and amend urban centres and cities infrastructure policies and plans to be more climate resilient. At a glance, focus should be placed on construction of affordable and sustainable housing, supply of sustainable energy, clean water access, sustainable waste management systems and construction of smart and green transport systems - including new road and rail systems that can manage the population pressure while balancing climate change impact. Improved access to these basic services will contribute to climate change mitigation, adaptation, and transition to net zero.

To spearhead this change, national governments and city-level administrations will need to review the existing public policies and align with international climate related standards. In the short run the policies could face political pushback but in the long term the value of investing in green infrastructure will be significant and yield more benefits to investors, local governments and city residents.

There is also a need to develop new ways of measuring the impact of green and non-green infrastructure projects on urban and city plans. As signatories to the Paris Accord, all East African countries have targets to reduce national carbon emissions. Implementation guidelines on carbon emission measurements however have not been enforced.

Also important on a local and national level will be factors such as green tax and incentives. Local municipalities in East Africa need to engage with their respective national governments to come up with clear green tax policies and incentives. Such incentives will encourage investors to fund and build sustainable infrastructure and promote projects that decarbonize, hence improving their bottom lines. The call to action is to all stakeholders to rally behind the greening of urban and city centres in the region.

On the plus side, climate friendly policies provide an opportunity for markets to attract investments in sustainable infrastructure. There is a growing base of stakeholders including investors and governments looking to develop and benefit from energy-efficient and sustainably built assets. Increased shareholder activism and a focus on environmental, social and governance (ESG) considerations has pushed significant pools of capital towards more sustainable projects, as climate change impacts are increasingly being recognised as a key risk for private investors.

There is no shortage of financing for sustainable infrastructure, even if the initial investment may be more expensive than high-carbon equivalents, investors will enjoy attractive subsidies and green taxes like carbon credits, while creating shared value for the environment and communities.

More cooperation and partnerships - from impact investors, sustainable businesses, governments, financial institutions - will be required to achieve sustainable infrastructure development within East Africa’s urban centres and cities to manage climate change risks. The multiple overlapping considerations - policy changes, regulatory frameworks, impact measurement and tax regimes mean the task of funding and building sustainable infrastructure to balance urbanisation is arguably one of the most complex challenges of our generation. But it’s a challenge worth overcoming!