Considerable attention has been given to enhancing subnational development finance in response to the 2008 global financial crisis and recent global development agendas, including the Sustainable Development Goals, Financing for Development, and Habitat III/New Urban Agenda. Much work on this topic is fragmented, focusing on specific elements of development finance: fiscal transfers, capital market access, public-sector lending agencies, or public-private partnerships. Most countries, however, have a range of subnational governments with varying needs and capacities that require different and evolving mixes of development finance mechanisms. Enabling greater subnational borrowing is often desirable but requires adoption of other reform policies to improve the fiscal capacity and creditworthiness of subnational governments over time. This paper reviews the rationale and potential for improving subnational development finance, outlines the overall landscape of institutional arrangements available for this purpose, and considers broad challenges involved. Based on a review of global practice and experience in selected Asian developing countries with a range of special entities and innovations to enhance subnational investment, it proposes a more integrated, strategic approach to building subnational development finance.

This document is the result of the discussions held during the 2016 Uraía Workshop which took place in Nicosia, Cyprus on April 19 and 20th, 2016. It is a working paper made in collaboration with the participants who attended the workshop including representatives of local governments, city networks, service and technology providers, civil society, international organizations and research institutes from all around the world. It gathers general recommendations on the use of SMART technologies to improve municipal finances and it is based on the participants’ experiences.

Democratic decentralisation through ‘conventional’ institutions of local government is facing increasing challenges, whether from financial pressures, questions of representativeness, difficult central-local relations and from a perhaps growing belief that local government has failed to realise its potential and there may be better ways of achieving societal goals. It is clear there is need to contemplate quite radical change to ensure local government becomes or remains ‘fit for purpose’. This collection of papers illustrates the way in which the role of local government is evolving in different parts of the Commonwealth and provides practical examples of new local government at work. It showcases emerging practice, and highlights success stories from new ways of working and challenges confronting local government in both developed and developing countries. New Century Local Government makes a very valuable contribution to helping understand the changing role of local government, and will ensure that practitioners are up-to-date with the most innovative initiatives in local government planning and administration.

This resource guide provides practical guidance for designing, implementing and evaluating decentralisation reforms and local government practices to ensure they are as effective as possible. It also synthesises and presents current debates on the impact of decentralisation and local government on poverty reduction, service delivery and conflict as well as providing links to cutting-edge research and recent case studies.