Growing urbanisation means that new housing and new infrastructure needs to be built. The goals of the Paris climate agreement cannot be achieved if the cities of the future are built mainly from cement, steel and glass, as was the case in the past. Construction therefore needs to become more efficient, climate-friendly and resource-saving. By modernising existing buildings and ensuring that new ones meet sustainability standards, by 2050 the energy consumption of buildings could be reduced by half. Nature-based solutions offer a sustainable alternative or additional option to technological approaches.
In the next 15 years, an estimated 93 trillion US dollars will need to be invested worldwide in climate-friendly and sustainable infrastructure – more than 4.5 times the gross domestic product of the US.

Residential house in Tirana, Albania
Accordingly, a major share of German Financial Cooperation is already being directed towards urban infrastructure or towards supporting the urban population in our partner countries. As part of these efforts, innovative financing instruments are increasingly being used to mobilise private capital.
Furthermore, in order to continue supporting cities in coping with this massive need for investment, Germany has teamed up with partners from all over the world to launch the Leadership for Urban Climate Investments (LUCI) initiative.
LUCI assists cities and municipalities in developing and emerging countries in elaborating bankable, climate-smart infrastructure projects. This includes supporting them via a new City Climate Finance Gap Fund, which is to be used to mobilise up to four billion euros for climate-friendly infrastructure in cities. Furthermore, in collaboration with the cities network C40, the BMZ has been supporting cities’ efforts to prepare sustainable infrastructure projects for some time now.