NDF contributes EUR 10 million to the AfDB Urban and Municipal Development Fund

Press Release (Helsinki, Finland and Abidjan, Côte d'Ivoire, 15 December 2022) — In partnership with the African Development Bank, the Nordic Development Fund (NDF) today announced a significant increase in its financial support to African countries and rapidly growing cities that bear the brunt of the burden of climate change and poverty.

The NDF confirmed that it will contribute 10 million Euros to the African Development Bank Group’s Urban and Municipal Development Fund (UMDF), a thematic multi-donor trust fund that helps African countries to spur climate resilient, livable and productive urbanization.

Africa is projected to face the fastest urban growth rate in the world; around 3.2 per cent per annum. By 2050 it is expected that around 1.5 billion people will live in Africa’s towns and cities: an additional urban population of 900 million people.  African countries remain the most vulnerable to climate change, and yet the most poorly prepared to deal with its impacts. About 70% of African cities are highly vulnerable to climate shocks, from the water crisis in Cape Town, sea level rise in Bizerte, storm surges in Beira or flooding in Lagos or Dakar.

After successfully establishing its African Cities Program, the Urban and Municipal Development Fund (UMDF) should now be enabled to scale-up its valuable support to more cities throughout the African continent. The NDF Board approved a new contribution of EUR 10 million at its meeting on 8 December in Helsinki. With this second grant, NDF is the largest contributor to date to the AfDB on sustainable urban development. NDF expects its contribution to have a catalytic effect on scaling-up the UMDF’s impact across African cities.

“We have been a proud anchor donor of UMDF and excited to be part of scaling up the programme to cities across the continent. Finding solutions for climate adaptation in Sub-Saharan Africa is at the top of our priority list, and we are pleased to see a strong commitment to gender equality and women’s empowerment in this initiative”, says Henrik Franklin, Director for Portfolio Origination and Management at NDF.

UMDF: Founded in 2019, the UMDF is a trust fund created by the African Development Bank to work upstream with African municipalities, local and national authorities by consolidating investment action plans, accelerating project identification and preparation (pre-investment activities), and offering capacity-building and mentoring programs. The Fund’s strategy is strongly anchored in the Sustainable Development Goals and the Paris Agreement. The Fund is for example supporting climate-adaptation projects in Addis Ababa, green waste recycling projects in Tunis, electric public transport in Marrakesh, and an e-mobility regulation framework in Angola.

NDF: The Nordic Development Fund (NDF) is the joint international finance institution of the five Nordic countries: Denmark, Finland, Iceland, Norway, and Sweden. NDF focuses on the nexus between climate change and development in lower-income countries and countries in fragile situations. Since the introduction of the climate mandate in 2009, NDF has built a track record of adding value by financing climate mitigation and adaptation projects in close interaction with its extensive network of strategic partners.

“The support from the governments of Denmark, Finland, Iceland, Norway and Sweden through the NDF is precious. This additional budget will boost the UMDF activities, allowing us to support better urban governance and planning, and to ensure that our continent’s cities are a transformative force for achieving the equitable and green growth across Africa” thanked Mike Salawou, director of the Infrastructure & Urban Development Department of the AfDB.

“The planning, governance and capacities of cities and towns must be significantly strengthened. This implies that systems are designed to enable cities to plan, fund and operate investments in essential services and climate resilient and low-carbon infrastructure themselves. For this, the integrated approach of urban planning and governance promoted by the UMDF is key to support African cities and municipalities to become more climate resilient, liveable, and productive. This support may be the most direct and effective way to unlock the development potential of Africa.” stated Aage Jørgensen, program manager at the Nordic Development Fund and also chairman of the UMDF oversight committee.