Policy Brief 11 - Potential Financing Options for Large Cities
In South Africa large cities face a myriad of challenges including rapid urbanisation, poverty, inequality, unemployment and huge infrastructure needs. Although these are not unique to large cities, the
magnitude of the challenges in large cities is greater and is increasingly becoming a major risk to the socioeconomic development of the country. The ability of cities to deal with these challenges depends, to a large extent, on their ability to generate more of their own revenues. As transfers and own revenues for large cities are heavily constrained, it is critical that cities leverage non-traditional and other innovative financing mechanisms. This policy brief summarises the findings of a study that evaluated different non-traditional revenues sources for South Africa’s large cities. Findings from the study suggest different options to enhance borrowing for large cities as well as strategies to improve public private partnership (PPP) deal flows in large cities. In addition, the study brings to the fore the value of land value capture mechanisms.
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