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Kampala (Ouganda)
Financing of essential local services and sustainable infrastructure in African cities is not sufficient to meet current demand. Project preparation funds can provide both preliminary technical assistance and project support for resilient urban development programmes. In doing so, they facilitate both decision-making and financing, especially from private stakeholders.

African cities are at the heart of an accelerated transition (almost 684 million African urban citizens in 2020, compared with 290 million in 2000) which, combined with very limited investment resources, is hampering their ability to build sustainable infrastructure and provide quality public services. Urbanisation is not just a phenomenon in “megapolises” (i.e., Kinshasa, Cairo, Lagos, etc.): Africa now boasts 8,500 urban areas with over 10,000 inhabitants, compared to 5,180 in 2000. African urbanisation requires estimated investment of US$150 billion a year. With African countries only able to cover US$60 billion of this amount, funding requirements are estimated at US$90 billion. This will be essential for making cities more functional, meeting basic infrastructure requirements and providing essential services.

Alongside quantitative challenges, it is vital to trace a more sustainable development path for African cities faced with more difficult climatic conditions (average temperatures in Africa have already risen by 1.4°C since the pre-industrial era, compared with 1.1°C for the planet as a whole). Local authorities have an important role to play in implementing national commitments to reduce carbon emissions and adapt to climate change, either by implementing national strategies at local level, or by helping to achieve the country’s climate objectives through innovative actions on the ground.


African cities have been particularly hard hit by natural disasters, exacerbated by climate change, despite contributing only a very small proportion of global greenhouse gas emissions (even today, Africa generally makes only a marginal contribution of around 9% to annual global emissions). These cities are often located in coastal regions or by rivers and are therefore more exposed to rising sea levels. Regardless of their location, they are also subject to extreme hydrometeorological events (devastating floods and heat waves aggravated by humidity in tropical areas, etc.). Moreover, their development is often unregulated: 40% of their growth takes place through the formation or densification of informal settlements. The lack of sustainable infrastructure and essential services reinforces socio-economic inequalities, deprivation and insecurity, especially for women and the most vulnerable, and exacerbates the impacts of climate change on people’s daily lives.

It is therefore essential to help local authorities to produce operational studies that can generate financing for investments that make cities more sustainable and resilient. As part of this approach, AFD manages grant funds that enable local and international consultancy firms to prepare sustainable urban development projects. In sub-Saharan Africa, the CICLIA (Cities and Climate in Africa) and CoM SSA (Covenant of Mayors in sub-Saharan Africa) initiatives, co-financed by the European Union and/or the Swiss State Secretariat for Economic Affairs (SECO), are the main programmes achieving tangible results on the ground.

AFD has used CICLIA and CoM SSA to finance expertise and technical assistance for getting projects up and running. This support consolidates the preparation of resilient urban infrastructure projects and ensures they are more effectively aligned with UN Sustainable Development Goals (SDG 11: “Making cities inclusive, safe, resilient and sustainable”), meaning that these investments can be financed by national development banks, international financial institutions or the private sector. Consequently, 15 capital cities and 27 intermediate cities have been supported in 19 sub-Saharan African countries. They include Durban, Cape Town, Kigali, Lagos, Lomé, Abidjan, Yamoussoukro, Kampala, Yaoundé, Douala, Conakry, Bobo Dioulasso, Mwanza, Tanga, Ganvié and Djibouti. With just €15 million in cumulative grant endowment funds within CICLIA and CoM SSA, over €1.7 billion in catalytic investments can be deployed in these cities thanks to financial engineering and project structuring overseen by AFD. More than €710 million of this amount has already been formally allocated by AFD, the European Union and other financial backers.


Experience shows that “Cities and Climate” project preparation funds effectively deal with two shortcomings. They make it possible to bolster local teams (local authorities and ministries) by focusing expertise on specific project arrangements. They also make up for the lack of financial resources available to African municipalities wishing to commission costly project preparation studies.

They can help fund the emergence and operational deployment of core initiatives at local level, such as adapting urban infrastructure to extreme climate phenomena, preparing for natural disasters, preserving ecosystem services (“green infrastructure”), promoting low-carbon urban mobility, providing socio-collective amenities that improve quality of life in poor neighbourhoods, and so on. However, the role of these funds in supporting urban decarbonisation and climate adaptation may clash with the priorities of national and local authorities in terms of strengthening emergency services, without challenging norms, standards and operating methods and infrastructure maintenance. In certain cases, only limited consideration isgiven to the longer-term implications of climate change.

Lastly, it is essential to factor in the time needed to prepare and set up institutional arrangements for structuring investment projects in African cities. Identifying, planning and forging two-way political and technical dialogue between stakeholders takes time but this is a decisive phase. It makes it possible to perform in-depth preliminary analyses, to forge multi-stakeholder dialogue and co-design the project, and to work on ensuring that the proposed solutions are acceptable. It also enables the co-financiers to be coordinated and onboarded, thereby consolidating the large volumes of investment funding needed for the essential urban transition.


Funding preliminary studies – a vector for private sector involvement

CICLIA and CoM SSA funds are paving the way for private sector involvement wherever possible. It is as much about encouraging partnerships with private companies to build and operate infrastructure or urban services as raising private funding.

Street lighting, mobility and solid waste management are among the urban services most suited to private sector participation. When structured via these funds – i.e. with a constant focus on alignment with Sustainable Development Goals (SDGs) – these projects can become genuine “impact” investments for African cities, reducing inequalities and helping to preserve the environment and the climate. They are then likely to interest committed private players, specifically because the potential risks (financial, technical, environmental and social) are identified and managed more effectively thanks to the studies carried out and the multi-stakeholder dialogue that takes place in the pre-project phase. The studies are rooted in the areas in which the projects are located and focus on each city’s specific “situation and development path” (i.e., a place-based approach).

  • For example, CoM SSA financed a feasibility study for the Aga Khan Foundation university hospital project (a private not-for-profit organisation) in Kampala, Uganda. This study was used to perform a cost/benefit analysis to improve the energy efficiency of the hospital building with a view to obtaining green certification. In 2020, Proparco and the Aga Khan Foundation opted to pick up the additional cost of recommended energy efficiency measures amounting to US$ 1.5 million (2% of total construction costs).
  • In Djibouti, CICLIA has financed a feasibility study for a new sanitary landfill site that complies with waste treatment standards. The analysis included a diagnostic review of the local regulatory and institutional framework, as well as a comparison of possible options for operating the facility. It culminated in a pre-feasibility study of a public-private partnership and its potential features (contract term, division of activities between the parties, allocation of risks and risk mitigation measures, operator remuneration arrangements,operator performance criteria, etc.). Once the option has been validated by the Djibouti authorities, the work will continue with the drafting of the tender documents for a BOT-type contract (Build-Operate-Transfer), including pre-qualification, call for tenders and the draft contract.
  • In Yaoundé, CICLIA funded a feasibility study for the “Trans Yaoundé” Bus Rapid Transit (BRT) project, one of the city’s flagship sustainable urban mobility programmes developed in 2019 as part of the MobiliseYourCity partnership. The project is headed up by the Yaoundé Urban Authority. The study proposes that BRT services be operated by a private company and suggests ways of managing the risks identified, especially the possible mismatch between passenger revenue and operating costs - for example, by guaranteeing cheap energy, providing the operator with an initial inventory of spare parts, or compensation payments to be made by the public authorities in the event of abnormally low passenger numbers. The project could be of interest to Cameroonian, African or international operators. To prepare as effectively as possible for a potential operating contract with a private operator, the study stresses that the Yaoundé Urban Authority should retain the services of a transaction advisor for the first two years of operation.
  • Lastly, it is also instructive to take the example of a feasibility study financed by CoM SSA as part of the “Omi Eko” lagoon transport project in Lagos State (Nigeria). Alongside financial backers like AFD and the EIB, the EU and the State of Lagos, the project, with an estimated total cost of around €400 million, is expected to involve the private sector as part of a facilities and services contract. This contract would be used to operate intelligent transport systems covering both the supply of the systems (ticketing, passenger information and the control centre), operation and maintenance of said systems for a 10-year period, and operation of the pontoon bridges, terminals and control centre throughout the concession period.


Samuel Lefèvre

Samuel Lefèvre

Cities and Climate Coordinator
AFD Group


Samuel Lefèvre is head of project teams at Agence française de développement’s (AFD) Cities division after nine years spent working in the agency network (in Johannesburg, Beirut and Amman). His areas of expertise include financial engineering and financing urban infrastructure and local development projects. Samuel Lefèvre currently manages project preparation funds for the Cities & Climate in Africa (CICLIA) and Covenant of Mayors in Sub-Saharan Africa (CoM SSA) initiatives, co-financed by the European Union, the Swiss State Secretariat for Economic Affairs (SECO) and AFD, for the benefit of African cities. He also heads up AFD’s Cities and Climate practice community.

AFD Group

The Agence Française de Développement (AFD) Group funds, supports and accelerates the transitions to a fairer and more sustainable world. Focusing on climate, biodiversity, peace, education, urban development, health and governance, our teams carry out more than 4,200 projects in France’s overseas departments and territories and another 150 countries. In this way, we contribute to the commitment of France and French people to support the sustainable development goals.

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