Administrator Samantha Power at COP28 Advancing Low-Carbon and Climate-Resilient Solutions in Cities Event

MR. MARK WATTS: We have now got an incredibly high-powered and esteemed duo to come to the stage for a discussion here. First, if I can introduce them to come on to the stage as I call out their names, the USAID Administrator Samantha Power, and as we've just heard, the recently appointed Green Climate Fund Executive Director Mafalda Duarte, please welcome to the stage. 

Now, I have a very ambitious set of questions in front of me, and I'm now looking at a clock that's in red, counting down. I say to both our panelists, don't hold back on your main points. Let's make sure we get those out as we go. But I guess to start us off, Administrator Power, it's really great that you're co hosting this event. Just tell us the basics, why focus on cities in your work?

ADMINISTRATOR SAMANTHA POWER: Thank you so much. And thanks to you for all your leadership in making cities change agents. Thanks to you Mafalda, for squeezing us in – this is kind of a big week for you, a big COP for you, and we're thrilled to see your leadership being brought to the GCF. We know it's a hugely important tool in the toolbox, and we at USAID are really excited to figure out how we work with countries and communities so they are coming to you with bankable projects that look attractive to you to create a virtuous cycle.

And thanks to my friend Carlos, and thanks to Mayor Pete. I often say about USAID that part of our job here is to make USAID a climate agency because climate is touching, and setting back so many of the development gains that have been made in recent years. I think what Mayor Pete, Carlos, and the team are doing, is also recognizing that you can't think about transportation public policy anymore without taking into account climate mitigation and adaptation as a design feature. And it's been thrilling to see the leadership that has been brought to bear. 

In brief, Gillian made the point already about 75% of the planet's emissions coming from cities, but it's worth even putting that in perspective: 2% of the land mass, 75% of the emissions. So if you're going to invest your time and you have limited resources, that's a really important locus of focus. 

Second, though, I would say that at USAID, since I was privileged to take over as Administrator, we have more broadly made locally-led development a cornerstone of our efforts. And you'd be surprised, and I won't go into the details because we don't have time, but to know just how little of U.S. foreign assistance actually goes to local actors – and that's both cities and officials. We don't do a lot of government to government assistance anymore, period. Also at the national level, but also local organizations, communities themselves who know best what they are grappling with, and probably are in the best position to help us design – or for them to design and for us to support the solutions. So I think thinking about cities is part of a broader shift that needs to happen in the way assistance is deployed that puts communities in the driver's seat. 

And then finally, just to come back actually to a point Carlos made at the very end. I just agree with the point that when you talk to mayors, you know the expression, or you may know the acronym: GSD. Everybody know GSD? As a mother, I shouldn't be really, anyway, get something done? The mayoral GSD index is a lot higher. And I say that as somebody who works in national government, then many public officials. There's just as Carlos said, you either fix the pothole or you don't. You’re accountable in a much more direct way to communities. And to me that makes cities an incredibly important laboratory for innovation and iteration as we think about transportation, again, design in an entirely new way. As we think about everything from air conditioners to cars, and sidewalks, and greenery. I mean, if we can get it right in cities, we will get it right, or more right, than we have up to this point. And in a nutshell, there's no way to achieve, just back to where I started where you started, there's no way to achieve not only our climate, ambition, but our climate necessities, without cities being at the center of the effort.

MARK WATTS: There’s no way to achieve the climate ambition without cities at the center, and some of us just learned a new acronym. Thank you. 

ADMINISTRATOR POWER: But you’re famous for your GSD scores very high for one who wasn't familiar with the…

MR. WATTS: And I noticed the mayors were nodding. 

So, Executive Director, the same question for you as your kind of mapping out what you want to achieve with Green Climate Fund? Why would you put cities at the center of the climate work?

MR. MAFALDA DUARTE: Thank you very much. First to say, it's a pleasure to be here in the U.S. Pavilion. U.S. has been a champion and a great partner of the Green Climate Fund. And I need to note and thank U.S. government for the pledge that was announced just this week of $3 billion. That has made the difference between GCF having a replenishment that is above last time, last four years, and substantially and that will be important as we embark on the next four years with a new strategy. So thank you very much. 

Thank USAID, and Department of Transportation, the hosts of the event, for choosing to invite us. And it's an honor to be with you, Administrator, in the same panel, our first. Why do we focus on cities? I think we already heard some of the points – most people are in cities, most emissions, a lot of vulnerability in cities, in particular in developing countries.

There's another piece of statistics that is always very important that I keep in mind, is that most of the urban land that will still be developed in developing countries is still to be built – so 60%. We will see massive investments in urban areas there are needed, these investments in infrastructure in developing countries, and we really need to make sure that this infrastructure is low carbon and climate resilient.

GCF is the largest multilateral fund in support of developing countries, to help them meet their own ambition in terms of climate action, both on mitigation and adaptation. Working with partners, of course, we are there to unlock and enable much larger flows of investment.

And we tend to focus on areas that are under prioritized or has not yet have not yet received as much attention as others. And so cities is one of them. I think we need to see a lot more investments in cities, so it is one of a priority area for us. On the other hand, as part of our strategy, it's very clear that we also have to target the most vulnerable. It's one of the key objectives of our strategy, targeting the most vulnerable and we know that there are large chunks of the population in developing countries in urban areas that are extremely vulnerable to climate impacts. So from both angles, this is an agenda that is really important to us. We were very happy to see in this COP that actually a local action, and I was listening in as a matter of fact to a panel that was mostly mayors and them saying that congratulating UAE for actually having a dedicated focus on subnational level action.

And so we were also very happy to announce at this COP an initiative, a blended finance platform first to actually mobilize institutional capital to provide long term debt to subnational governments. So we look forward to seeing that off the ground, moving speedily into action. So this is in a nutshell why this is so critical for us.

MR. WATTS: Right, thank you and I think we're moving a bit there from the why cities to then the how you're looking to support, and Administrative Power, if we could move on to that same question with you also. So you've said you see the development community now starting to focus a bit more on cities in terms of climate action, and certainly, for your work. How do you think USAID is going to be focusing on cities and climate?

ADMINISTRATOR POWER: Well, again, for starters, all the work we do in other sectors, just as I was saying in the context of the Department of Transportation, our work in other sectors on economic growth, on governance and public financial management, I just mentioned sort of responsible use of debt – that doesn't leave you saddled, that doesn't leave future generations saddled for years as you try to make sensible investments in the here and now that ultimately will be in the interest of future generations. We have programming in all of these domains that is not explicitly climate mitigation or climate adaptation programming, but it is absolutely the necessary foundation to be able to take advantage, for example of the of the kind of opportunities that we hope under Mafalda’s leadership and that of her team, that institutions like the GCF will make possible.

Today as it happens, funny you should ask, but today we are committing more than $53 million for new low carbon and climate resilient activities in more than 23 cities in Asia, Africa, Latin America, and Caribbean. Again, this complements work that is underway. But it is going to be a more dedicated and concentrated kind of climate specific effort. Again, if we only do that, that's a tiny amount of money given the needs in the city. We view that money as enabling and as catalytic, and in the interest of helping those cities do everything from thinking about building codes and decarbonisation in a different way, to thinking about clean transportation and planning, releasing less methane, which people are finally coming to grips with just how much even more damaging methane is than then CO2. So, again, helping those cities in viewing ourselves as kind of enabling agents in support of the visions that those cities are themselves formulating.

MR. WATTS: Wonderful, great, great to hear all the new fun there. Executive Director Duarte, you've kind of teed this up a bit already, how are you seeing Green Climate Fund now financing city forum action? You talked about this new blended finance program, perhaps you can say a bit more about that and the other initiatives that you're taking?

MR. DUARTE: So the interesting thing about the Green Climate Fund and I’m relatively new and learning my way through the learning curve, but some of the things that I find interesting is that it has quite a wide range of very relevant tools. So what is called “Readiness Program,” so we actually have a really large amount of resources that our board has just recently decided to allocate for building capacity of institutions, for helping them enhance their policies, their plans, and developing a pipeline of projects. So this is one tool. 

We also have quite a significant amount of project preparation resources so we can also help provide dedicated resources for projects to help do the studies, feasibility studies and other analytical work that is necessary. And then of course, we have the investment and our investment arm and again, there with a lot of flexibility in terms of the financial instruments. So it's actually quite interesting to see the portfolio of GCF has a lot more equity investments and guarantee investments than I have seen in other funds. But we have the flexibility of providing grants as well, and even other financial instruments. So it's well equipped in terms of tools. We have been investing already in cities. And we have $1.7 billion of our own capital invested in a range of projects, focusing on the decarbonization of the energy systems, energy efficiency, compact and more resilient urban development, and circular urban economy. Of course, we have to do a lot more and as I said, I think we are quite committed to make this one of our priorities in the next four years. 

I'll just give you a couple of examples. One is a program that we have with the European Bank for Reconstruction and Development. So we've provided them $275 million and they are basically helping several cities with their capacity - capacity at institutional level - integration of policies, green procurement, and actually building that pipeline of investments. Another example with the World Bank, they have a large global cooling facility, we know how cooling is going to be a major driver of energy demand and GHG emissions. So again, we have put in that broader facility of almost $900 million, we've put $175 million. 

As I said, this new blended finance platform that we just announced at this COP, this is really targeted at subnational borrowers and basically trying to bring institutional capital to provide long term debt. But another thing that we are doing, we aligned quite closely with the UNSG call on making sure that all countries have early warning systems, robust early warning systems by 2027. This is important also for cities, and in terms of the resilience of the population. 

So we have already also made substantive commitments. But even this week, as well, we announced doubling down on our efforts so that we really help close that gap and join other partners to close that gap. So these are just some of the examples of what we are already doing, what we are planning to do. But I really look forward to seeing these innovative platforms. Just maybe one final one. We also announced this week, support to a Green Guarantee Company. This is basically to support guarantees, guarantee collaboration, a bond of climate issuance of climate bonds and loans. So again, another instrument that subnational entities might be able to use so they themselves, those that can I know that not all can, but those that can issue debt, they can benefit from these guarantees.

MR. WATTS: Right. And I certainly know that that support for early warning systems will be very well received in the cities that we work with. And it perhaps certainly leads on to my next question, which is about some of the challenges here and particularly around funding adaptation in cities. I know from C40’s experience we give equal weight to adaptation and mitigation, but 90 percent of the funding that we receive and are able to disperse is for mitigation. Which is not remotely a reflection of the demand for support from cities, and that's true in terms of climate finance, generally. Administrator, how do we change that? How do we get financial support for adaptation from public sources but also from the private sector into cities? 

ADMINISTRATOR POWER: Well, let me maybe just build on what Mafalda talked about because I thought she did an excellent job laying out the kind of menu of offerings from the Green Climate Fund, but I think she and we in the room would be all quick to acknowledge that when you go out, and you must see this in the cities that you work with, you rarely hear ‘wow, the climate finance architecture is working brilliantly.’ It's just like an iPad, accessing resources. So, simplification, de-bureaucratization all of that to be able to get access to that menu is so key. And we've been the co-chair of the board of the Green Climate Fund working with Pakistan, other board members, and above all, the leadership of the GCF to see steps in that direction. 

But I think what's so wonderful about these readiness funds these project preparation funds, is that you put your finger on what we hear most from communities that they need, they need to be able to adapt, they see their public transportation mired in floods or again, even the energy costs of keeping up with extreme heat, nevermind the emissions costs. And they're crying out for help to adapt to the temperatures and the extreme weather events that are already upon them. But many, and the mayors will probably speak to this, don't know how to get from here to there. Right? So, I think our job as an agency that doesn't, unfortunately, have huge amount of amounts of money ourselves to bring to this because we're still divided in the United States, more than we should be politically on these issues, even though so many American communities are themselves crying out for adequate adaptation – they don't call it adaptation support – but that's what they're looking for.

But to use our ground game – we have 13,000 people who work all around the world, we have full-fledged missions in 82 countries. Three quarters of our staff in these countries are nationals of the countries in which we work – they are Sierra Leoneans, for example. So how do we tap that network to support cities in being better able to access these large pools of finance? I think that is a comparative advantage that we and other development actors can have. 

And I think actually, I was just in Maldives, which is not known for its cities per se, but I was in Malé and USAID made a front end investment in an early warning system and I just give a plug for it. By dramatically increasing the computational capabilities brought online, they were able to predict not only this amount of rainfall is coming to Malé at this time, but as vivid as this: next to this school, the land will be submerged for 10 hours, with two inches of rain water to recede at this time. It's an extraordinary level of prognostication. We seeded it, we invested it, we created proof of concept. And then the GCF came in over the top now with real money to scale it, in that instance to other islands. You know, not to cities the size of those that we'll be hearing about, but I think it's another example of us creating proof of concept and then putting cities and leaders and communities in the position to then go to the bigger resource opportunities to scale.

MR. WATTS: Great. So Executive Director, if you would like to add to what you've already said about how you're going to stimulate more funding around adaptation in cities, but as we note the clock is ticking down in front of us. Perhaps you could also give us ten seconds on what gives you hope. And then if we can leave a bit of time, I'll come back to Administrator Power with the same question.

MR. DUARTE: Just to say that, I fully agree with Administrator Power, that we need to simplify access. I've been saying for some time, I've tried to emphasize this message during this COP: at the pace that we are going, if we keep going at this pace we are not going to make our climate goals. And we just have to think if we continue to use the processes we have today, how long does it take us to deliver finance and results on the ground. And we pretty quickly see that we will not make it because things that we invest today with the current processes will only deliver results in ten years, seven to ten years. So we really need to reform, and that's our commitment. The commitment of our board, it's my personal commitment, my team's commitment, we will simplify and we will be asking our partners to help us and, part of that process will be listening from those that are on the receiving end, and keep listening and feeding that back because we have to have fit for purpose processes.

But when it comes to the subnational level and support to mayors and municipalities, I think we need to respond to an integrated approach. So, as you said, there's a lot more disproportionate support to mitigation efforts or was labeled to mitigation efforts, compared to actual resilience. I think we need to support integrated approaches - tackling both mitigation and resilience. Because I was seeing mayor from Freetown saying those divisions are artificial, and therefore I think it's really important to take that into account. 

What gives me hope, it gives me hope to see so many champions of climate here, but many more even that are not here that are day by day, are they youth, the local communities, leaders, local leaders, other leaders. That's always what gives me hope. That you know, if we stick together even more and we forge strong partnerships. The clock is ticking, unfortunately, the science says it's ticking faster and faster, which is a little bit counter. And so we really need to be laser focused on delivery, action, delivery, action.

MR. WATTS: Wonderful. And the clock is ticked by Administrator Power, the one sentence version once given you hope in this cities and climate space.

ADMINISTRATOR POWER: I’m incapable of one sentence but I will do maybe two, which is 60% of people living in cities by 2030 will be under 18. And young people are the reason this COP has the energy it has. They're the reason whatever progress we've made, and we know it's woefully insufficient, that's because young people have stepped up and said they deserve more. 

And the second thing that gives me hope briefly, is even though it's too slow, the private sector is showing more interest in adaptation, not merely as part of corporate social responsibility, which is part of just national responsibility and corporate social responsibility, but increasingly as part of their business model. But that has to accelerate more than just about anything, because we will not make up for lost times and the vulnerability of those young people and older people alike in those cities if it's just left to public sector finance alone.