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FINANCING of Smart Cities concept will come under the spotlight when international development financiers, technology providers, and urban planners gather to explore strategies on implementing the new concept next month.
The one-day engagement under the theme ‘Innovative financing solutions in the cities and rural communities’ ecosystem post Covid-19 pandemic’ is set for Harare.
It is being organized by DEAT Capital and targets about 300 delegates.
The proposed programme follows a successful inaugural Smart Cities and Rural Communities forum held on the sidelines of the recent Zimbabwe International Trade Fair (ZITF) in Bulawayo.
A ‘Smart City’ is one that uses information communication technologies to improve operational efficiency, share information with the public and provide a better quality of public service and citizen welfare.
Cowdray Park suburb and the former Ascot Race Course in Bulawayo have been identified as potential sites for the construction of smart cities, with a feasibility study already being embarked on.
President Mnangagwa has emphasised the need for the country to implement the smart city concept in line with the recently launched climate policy.
DEAT Capital managing director, Mr Nicky Moyo, said stakeholders will examine opportunities to catalyze resilience and innovation post-Covid-19 pandemic to support growth plans of the Zimbabwe Vision 2030.
He said financing is often stated as one of the biggest challenges to implement a smart city strategy.
“To realize the promise of Smart Cities, governments need a new approach for financing their projects, forming partnerships, procuring products and services, and providing governance,” said Mr Moyo.
“Our company DEAT Capital, a trade and investment consulting firm is organizing a high level one day Financing Smart Cities & Rural Connect Conference on 30 June 2022 at Rainbow Towers Hotel Harare Zimbabwe,” he said.
Investors, banks, infrastructure planners, construction providers, technologists, municipal leaders, senior Government officials, donors, financiers, investors, industrialists and academics are expected to attend.
“They will be a showcase of technical solutions for smart cities and rural applications such as smart traffic management solutions, smart housing, smart grids, agritech, e-commerce, digital finance, e-grocery platforms, smart transport system, smart tourism, smart education, smart health, smart geospatial systems, and e-governance,” said Mr Moyo.
According to a concept paper, Zimbabwe is embarking on a slate of ambitious and new, fourth-generation ‘smart cities’ on the cusp of the nation’s Sustainable Development Strategy Vision 2030.
Apart from different factors that contribute to the development of a smart city, finance acts as the backbone.
“Given the volume of funds required for modernizing infrastructure, smart cities and rural communities need to consider innovative financing strategies to transform their vision into reality.
“Traditionally, city and rural infrastructure have been provided by the public sector out of current fiscal resources. Grants from the central government can only meet a small part of the total needs for infrastructure and services. Concessionary loans and international donations rarely make up the shortfall, even for developing nations like Zimbabwe,” reads part of the paper.
“Cities and rural communities are also now more reliant than ever before on private sector support to scope, finance, and deliver projects.
“Governments have treated traditional Smart Cities projects much as they treated any large infrastructure project, such as building a new light rail system or sewage treatment plant. They typically issue requests for proposals (RFPs) with detailed engineering specifications, give the projects large budgets, both for capital expenditures and ongoing operational costs, and assume most of those costs, along with the financial risks. Private sector entities often join the projects as vendors rather than partners.”
Mr Moyo said attracting investors requires a comprehensive strategic plan that communicates the opportunity and presents a robust business model, a creative approach to funding and financing.
As cities and rural communities look to upgrade their infrastructure with smart technologies, paying for those projects presents a significant challenge of introducing smart technologies on a wide-scale basis, he added.
“Financiers that generally understand smart cities and rural communities often have an infrastructure background; however, their preference is for long-term projects,” he said.
“The shorter-term nature of technology-related projects can be outside their remit or bring additional risk and challenges to smart cities projects that need to be considered. While there are numerous options available to source finance for smart cities and inclusive rural communities’ investments, a challenge in taking advantage of many of these options is matching the project to the most appropriate financing tool.
“This requires that you fully understand the project, its potential cash flows, the range of financing options available locally and internationally, and available procurement methods to the Government in order to deliver for private sector and institutional investors, developing economies present significant challenges, including political, regulatory, macroeconomic, business, and technical risks,” said Mr Moyo.
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