French Development Agency Financing Low Carbon Cities in Asia and emerging countries Sylvie MARGAT, Deputy Director of AFD Bangkok

AFD, the French Development Agency French ODA Agency AFD is the Groupe Agence Française de Développement, a bi- lateral development finance institution established in 1941 AFD mission is to finance development according to France’s Overseas Development Assistance policies. AFD is 100% State-owned and works on behalf of the French government Untied aid Present in 60+ countries AFD’s activities are aimed at reducing poverty and inequalities (Millenium Development Goals), promoting sustainable economic growth (green and socially inclusive), and, in emerging countries especially, protecting “Global Public Goods” of benefit to all humanity. Protecting Global Public Goods includes the fight against climate change EUR 5 billion annual commitments in 2009 Asia region = average of 20-25% of commitments Urban development = 25% of yearly commitments, mainly through direct lending to cities

Some recent examples Direct loans to cities to support the implementation of municipal climate change action plans and social inclusion Durban, South Africa (under appraisal) Bangkok, Thailand (under discussion) Diyarbakir, Turkey Direct loans to cities for the financing of Mass transit systems: Istanbul, Turkey: 120M€ soft loan in 2006/2008, extension of metro and light rail systems (disbursed) Amman, Jordan: soft loan, under appraisal, for 3 BRT corridors Medellin, Colombia, loan, under appraisal Curitiba BRT and Biodiversity preservation (38 M€), Brasilia Tramway (to be signed) Not only in emerging countries: Dakar (10 M€), Energy Efficiency in public lighting (under implementation)

Additional information Sylvie MARGAT, Deputy Director of AFD Bangkok

AFD, the French Development Agency French ODA Agency AFD is the Groupe Agence Française de Développement, a bi- lateral development finance institution established in 1941 AFD mission is to finance development according to France’s Overseas Development Assistance policies. AFD is 100% State-owned and works on behalf of the French government AFD Group PROPARCO : financing of the private sector French GEF secretariat CEFEB: financial training center Present in 60+ countries AFD’s activities are aimed at reducing poverty and inequalities (Millenium Development Goals), promoting sustainable economic growth (green and socially inclusive), and protecting “Global Public Goods” of benefit to all humanity. Protecting Global Public Goods includes the fight against climate change and pandemics; the preservation of biodiversity; the promotion of social and environmental responsibility; as well as aid to countries weakened by strife, war and natural disasters.

AFD, the French Development Agency EUR 5 billion annual commitments in 2009 Asia region = average of 20-25% of commitments Infrastructure & urban development = 25% of yearly commitments Wide range of financing tools Grants (projects, study funds) Sovereign loans (from concessional to market conditions) Non sovereign loans (concessional or market conditions) Private sector loans (market conditions) Partial risk guarantees, loan guarantees, Guarantees on loans in local currency Equity financing Untied aid AFD works hand-in-hand with many partners: national, regional and local governments; local authorities and municipalities; international agencies; non-governmental organizations; foundations; private companies; entrepreneurs; and local banks, microfinance institutions and capital markets…

AFD’s field office expansion Jakarta 2007 New Delhi 2007 Islamabad 2007 Amman 2006 Sanaa 2007 Port Louis 2006 Brasilia + Sao Paulo 2007 Luanda 2008 Lagos 2008 Istanbul 2005 Beijing 2006 Colombo 2006 Damascus 2009 Cairo 2007 Kabul 2009 Bogota 2009 Mexico City 2009 Abidjan 2008 re- opening Manilla (Philippines) 2010 Almaty (Kazakhstan) 2011 Baghdad (Iraq) 2010 Paramaribo (Suriname) 2010

Bus Rapid Transit system in Amman, Jordan (under apraisal) Development of efficient public transport in Amman, fast growing capital city of 2,6 M hbts, 3 BRT lines, 32 km Great Amman Transport Master Plan previously financed by AFD (grant) Paris city cooperation Project impacts: access to transport for the poor populations, urban productivity improvement (big reduction in transportation time), CO2 emissions reduction, air quality improvement, increase safety

Bus Rapid Transit system in Amman, Jordan (aproved)

Integrated urban project of central east Medellin (under appraisal) Urban integrated program: main objective is social inclusion Massive public investments in a poor area AFD component: Financing a tramway line and 2 cable metro lines positive environmental impact and economic development cobenefits 2,5 M hbts, Colombia 2 nd City

Background Supporting the sustainable development / climate change program of the 3rd South African city Issues Implementation of an energy efficiency and renewable energy policy and financing of projects, Developing access to basic environmental urban services (sanitation, solid waste, etc.), Integrating disadvantaged population to the city by restructuring social housing projects Financing & technical assistance direct financing to the municipality in local currency Support to the energy office / climate change unit to lead & coordinate the program, and acquire the relevant expertise (EE, RE, social housing, urban development, etc.) Impacts: Reduce Durban environmental footprint / Support social policies / Promote pilot project to limit urban sprawl Supporting the sustainable development of Durban city in South Africa

Partner the Metropolitan Municipality of Istanbul (15 M hb.), created in 1982 to regroup all district municipalities Project Mass urban transportation program under construction, composed of several railway lines (metro, LRT, tramway lines) Positive social and environmental impact (CO2 emission reduction) and on urban productivity Financing Total cost of the program is above USD 1.5 Bn, half of the financing comes from the municipality’s own resources AFD provided the MMI with a € 120 M concessional loan (60 M€ in 2006 and 60 M€ in 2008) 15-year maturity with 5 year grace period Issues A first sub-sovereign financing in Turkey without the MOF guarantee After this first commitment from AFD, Istanbul got access to wider financial market (EIB, other banks) Public railways transportation program in Istanbul

Greenhouse Gas Emission in Bangkok Compare with Other Large Cities Source: World Resource Institute, % of the world total GHGs emission Sanfrancisco Sandiago Toronto Bangkok New York Tokyo London Source: Chulalongkorn University, 2007 CO 2 Million Tons per year Developing a partnership with Bangkok on the Global Warming Action Plan (under discussion)

The 5-Year Action Plan for Global Warming Alleviation (2007 – 2012): The 5 Approaches 1. Improvement of Transportation System 2. Promotion of Renewable Energy 3. Energy Conservation and Building Retrofit 4. Solid Waste and Wastewater Management 5. Expansion of green areas Ultimate Goal: 15% reduction of GHGs emission by 2012 In April 2008, BMA officially adopted: Developing a partnership with Bangkok on the Global Warming Action Plan for 2007:2012

Objective : “assist Guiyang establish a comprehensive Transport plan, covering the Greater Guiyang area and comprising all transportation modes, which will take into account environmental and energy consumption aspects” Contents. Transport demand model for Greater Guiyang (transport network and travel demand analysis capabilities; all modes, traffic-related air pollutant and energy consumption estimations derived from the model). Strategic Environmental Assessment (SEA) (focused on energy aspects; overall assessment of the urban development policies and specific assessment of the Transport Plan; using a mix of qualitative assessment and quantitative data; recommendations integrated in transport plan). Support to Transport Planning Process (facilitating integrated approach from an institutional point of view) Example :Guiyang Transport project, TA support

Requirements. Integration in formal planning exercise: - appropriate timing - “methodological” integration - inter-departmental collaboration. Political interest and will at municipal level. Legal framework + guidelines? Benefits and Co-benefits.Global Environmental, local environment, political, social, economic (economic benefits of better-dimensioned integrated system, city attractiveness, etc…). SEA a comprehensive tool to program appraisal and analysis.Long term partnership with development partners related to future investment.Field open to city-city international cooperation Contents Example :Guiyang Transport project, TA support Lessons learned