Upscaling transformations for urban and territorial equality


A new subnational governance culture is crucial in the face of growing inequalities. It is necessary to promote broad local partnerships, encourage greater participation and adequately empower LRGs, thus making multilevel governance truly effective. LRGs can advance pathways to equality by engaging practically with time frames that look beyond electoral cycles: recognizing different and unequal historical legacies and structural constraints, addressing the issue of time poverty, supporting radical incremental practices and working together to establish bold visions for a sustainable and equitable future.

These different pathways are grounded in local experiences and have great transformative potential. However, in order to materialize and expand their potential, there is an urgent need to implement appropriate policies and planning, and also to upscale equality-building processes so that they are capable of responding to the diverse needs of different territories and national contexts. The multidimensional expressions of inequalities analyzed in GOLD VI are deep-rooted in different spatial contexts and geographies and at different scales. They manifest themselves in the growing inequalities between urban systems and territories, and between globalized metropolises and regions. They can be seen in less integrated, or stagnant, intermediary cities and places, shrinking cities, and marginalized rural regions and towns. Spatialized inequalities manifest themselves at the intra-, inter-urban and regional scales. Mitigating multidimensional inequalities and upscaling local initiatives that create alternative development pathways requires an enabling framework. This enabling framework needs to be buttressed by an effective decentralization that facilitates innovation at the local level, accompanied by solidarity-based policies and planning that can reconfigure unequal territorial. No single level of government can address inequalities within cities and across territorial systems alone. As underlined in the different global sustainability agendas, including the 2030 Agenda, the Paris Agreement and the New Urban Agenda, adopting whole-of-government and whole-of-society approaches requires collaborative governance, policy cohesion, participative planning and balanced urban and territorial development. Harmonizing sectoral policies and strategies across territories through effective multilevel governance is a necessary condition if we are to leave no one and no place behind. Key actions to strengthen sustainable development at different scales already exist in some countries and regions. These include: territorial and urban policies (e.g. European Union cohesion policies, national urban policies in different countries), efforts to achieve SDG localization, and post COVID-19 recovery plans. However, in order to catalyze these transformative local actions, development policies and planning strategies need to highlight the realities of regional and urban inequalities in a more conscious and proactive way.

The principles of subsidiarity, shared responsibilities, collaborative implementation and solidarity between territories are central to this endeavour. These principles call for mechanisms such as cofinancing and monitoring, as well as closer and fairer collaboration between local, regional and national governments, and with civil society. They are necessary for effectively addressing inequalities in ways that strengthen local democracy and accountability. Within the framework of decentralization processes currently taking place in most countries across the world, devolution must be accompanied by an effective redistribution and sharing of powers, functions and resources between different social, environmental and economic domains.

LRGs need the fiscal capacity to increase their investment in urban infrastructure and services, to improve access to essential services and adequate housing, to promote caring and connectivity, to mitigate and adapt to climate changes, and to strengthen local resilience and prosperity, in ways that are cocreated with their communities. To achieve this, the rules of the game need to be renewed: it is necessary to promote financial ecosystems and partnerships that mutually support each other and to work to secure collaboration in urban and territorial investment projects. To boost local initiatives, national institutions should develop new financial models, as part of better balanced national urban and territorial strategies, and reinforce their technical capacity to localize finance.

As part of these efforts, poor neighbourhoods, cities and regions need to be given special consideration in order to foster endogenous development and strengthen local capabilities. This requires the delivery of adequate and reliable intergovernmental fiscal transfers from national governments to LRGs, coupled with transparent equalization mechanisms. To respond to local and regional needs, subnational investment can be strengthened through mechanisms such as subnational development banks, local government funding agencies, local green banks, or the issuing of bonds. Where possible, this should be done working in tandem with appropriate community-led financing initiatives. Likewise, LRGs need to gain greater autonomy over their own-source revenue, to strengthen local capacities, and to rebuild their fiscal space, via an adequate system of local taxes. They should be able to collect and capture the added value generated by urban and local development. Giving LRGs adequate fiscal autonomy is a precondition to them becoming empowered and able to innovate and use a wide array of financing mechanisms, including equity and debt financing, to support local investment.

The need for accelerated mitigation and adaptation to climate change and to social and natural disasters implies that local, regional and national financing will need to be further supplemented, and especially in the Global South 1 A large part of these adaptation efforts will require local, regional and national partnerships for their implementation, as well as support from development assistance and multilateral development banks, supplemented by contributions from NGOs and private climate funds. Investment projects developed by financial partners can have a significant social impact by supporting solidarity and circular economies. This can be done through cooperative and development banks, solidarity savings schemes, and financial and economic short circuits.

For the pathways to equality identified in this Report to effectively unleash their transformational potential, they will need to be embedded in strong local alliances and accompanied by structural reforms that improve local and multilevel collaborative governance across different sectors and territories. These are necessary conditions for upscaling the transformative actions that these pathways propose, triggering an incremental and cumulative effect. In doing so, these pathways can lead to a radical transformation of urban and territorial systems and help to make them more just and capable of meeting the sustainability commitments adopted by the international community.

  • 1 IPCC, “Strengthening and Implementing the Global Response. Global Warming of 1.5°C,” 2018,


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