Innovative Infrastructure Financing in Small Towns: A Comparison of Marondera Municipality (Zimbabwe) and Thulamela Local Municipality (South Africa)

Abstract

This study seeks to compare infrastructure financing successes and challenges in Marondera Municipality in Zimbabwe and the Thulamela Municipality in South Africa. Infrastructure financing is critical for providing services essential for the social, economic, and environmental well-being of cities. Traditionally, central governments have been responsible for funding infrastructure investment needs at local levels. However, the fiscal distress faced by many governments in developing countries has forced small towns to formulate alternative strategies and arrangements to finance capital investment or infrastructural maintenance needs. The main data-gathering techniques for this study were key expert-based interviews and a review of relevant institutional documents. Data analysis was largely qualitative, augmented by quantitative data to support qualitative findings. Results show that in some cases, market-based financing and local own-source revenue strategies have been successful, although more often than not there are challenges which come as a result of the restrictive policy environment, inadequate skills for resource mobilisation, and lack of public support. The study proposes building on lessons from the current strategies and contextual application of best practices from other developing countries as strategies for improving infrastructure financing mechanisms which resonate with financing principles echoed by United Nations (UN) in the New Urban Agenda. These lessons include enhancing the responsiveness of municipal land-use planning to market dynamics, improving value capture methods, legislative support, improving municipalities’ skills in designing and managing Public–Private Partnerships, and continuous public engagement.