Financial Instruments for Urban Development Support. The Role of the World Bank in latin American Countries

The topic of financing sub-sovereign entities is gaining a central place in the agenda of many development stakeholders as a key factor for improving the productivity of urban economies. The availability of long term financial resources for financing urban infrastructure investments is essential for enhancing local economic development, at both the company and household level, and then for enabling cities to better cope with the globalization challenge. Urbanization which have recently affected many countries in the developing world, have sharply increased the responsibilities of local government in the delivery of public services in local communities, as well as urban infrastructure investment. The traditional sources of sub-sovereign financing have proved insufficient to adequately support these new tasks. Borrowing in the capital market is the most valuable way to finance the delivery of public services and bridge the financial resource gap of many local government. This book analyses the topic of financing for sub-national entities in Latin America in light of the urbanization and decentralization. The role the World Bank plays in helping local government access the capital markets is also examined. An analysis of the experiences in some developed countries helps identify the basic steps in local credit market development, and the possible lines of evolution it can foster in Latin America.