Securing Financing for Affordable, Green, and Resilient Housing and Buildings

The buildings sector is critical for decarbonization and managing the impacts of a changing climate. It represents 37% of energy related CO2 emissions (including operations and construction), and itis increasingly exposed to climate vulnerability and disasters, particularly in low- and middle- income countries (LMICs). The sector also has a significant role in the socioeconomic dynamics of urbanization. As we look forward 2050, when an estimated 68% of the global population will live in urban areas, the intersection of housing with socioeconomic development becomes more critical. The increasing urban population will drive a rise in the demand for housing that is not only green and sustainable but also affordable and resilient to the impacts of climate change.

While the buildings sector is key to achieving the objectives of the Paris Agreement to limit the global temperature increase to well below 2°Celsius and strengthen climate change adaptation and resilience, subnational governments, especially in LMICs, have limited access to adequate financing to scale up climate smart investments in the buildings sector and to provide affordable and sustainable housing. The role of multilateral development banks (MBDs), NGOs and the private sector is critical to support subnational governments in their transition to a green and resilient buildings sector and to address climate change, while ensuring affordability of housing for economic productivity, health, and well-being of their citizens This is critical for regions such as Africa where access to finance is limited and where the lack of adequate financial instruments, high upfront costs, and perceived risks make challenging to funding green buildings. MDBs can help mitigate these barriers by providing financing, expertise, and by leveraging additional private sector capital, playing a critical role in enabling the shift towards green and resilient urban development.

Overview of the session

This session is designed to enhance understanding of the financial challenges that subnational governments in LMICS face and to foster discussion on the different approaches and financial instruments available to support their needs. The session will feature a panel discussion with representatives from subnational governments, the World Bank, the International Finance Corporation, the African Development Bank, UN Habitat, and Shelter Afrique. They will share their experiences and strategies for securing finance to foster affordable housing and to advance the transition towards a low carbon and green building sector.