ISTANBUL INTERNATIONAL CENTER FOR PRIVATE SECTOR IN DEVELOPMENT ENGAGING THE PRIVATE SECTOR FOR INCLUSIVE URBANIZATION: The Role of Municipally Owned Enterprises ENGAGING THE PRIVATE SECTOR FOR INCLUSIVE URBANIZATION: The Role of Municipally Owned Enterprises ENGAGING THE PRIVATE SECTOR FOR INCLUSIVE URBANIZATION: The Role of Municipally Owned Enterprises The findings, interpretations and conclusions expressed in this study are those of the authors and should not be attributed to the United Nations Development Programme (UNDP), to its affiliated organizations or to members of its Board of Executive Directors or the countries they represent. Moreover, the views expressed do not necessarily represent the decision or the stated policy of the UNDP, nor does citing of trade names or commercial processes constitute endorsement. The designations employed and the presentation of material on the maps in this publication do not imply the expression of any opinion whatsoever on the part of the Secretariat of the United Nations or UNDP concerning the legal status of any country, territory, city or area or its authorities, or concerning the delimitation of its frontiers or boundaries. Cover and Graphic Design: Çizgi Reklam Copyright © 2019 United Nations Development Programme Istanbul International Center for Private Sector in Development All rights reserved. No part of this publication may be reproduced, stored in a retrieval system or transmitted, in any form by any means, electronic, mechanical, UNITED NATIONS DEVELOPMENT PROGRAMME photocopying or otherwise, without prior permission of UNDP ISTANBUL INTERNATIONAL CENTER FOR PRIVATE SECTOR IN DEVELOPMENT CONTENTS Abbreviations 2 Acknowledgements 3 Preface 4 Foreword 5 Executive Summary 6 1. Urbanization 7 Context and Issues 7 UN Strategy for Sustainable Urbanization 9 The New Urban Agenda 10 Relevance to UNDP 10 2. Providing Basic Municipal Services for Sustainable Urbanization 12 Water and Sanitation 13 Urban Waste Management 13 Urban Mobility 13 Urban Energy 14 Green Spaces 14 3. The Role of the Private Sector in Inclusive Urbanization 15 Public-Private Partnerships (PPPs) 16 State-Owned Enterprises (SOEs) 18 Municipally Owned Enterprises (MOEs) 18 4. Inclusive Urbanization through Municipally Owned Enterprises (MOEs) 19 MOEs: Global Practices 20 MOEs in European Union Member Countries 21 MOEs in the United States of America 23 MOEs in Latin America and the Caribbean 24 MOEs in Asia-Pacific 25 5. Good Practices from Istanbul: Istanbul Ağaç ve Peyzaj A.Ş. 27 The Urbanization of Istanbul 27 A MOE in Istanbul’s Green Spaces: Istanbul Ağaç ve Peyzaj A.Ş 27 Inclusive Business Models of Istanbul Ağaç ve Peyzaj A.Ş 28 Vocational Training Courses on Gardening 31 Capacity Building Model: Advanced Training Courses 33 Research and Development: 35 Bringing Advances in Landscaping to the Local Market—Soilless Agriculture 6. Conclusion and Way Forward 35 End Notes 36 ENGAGING THE PRIVATE SECTOR FOR INCLUSIVE URBANIZATION: The Role of Municipally Owned Enterprises 1 ABBREVIATIONS ACKNOWLEDGEMENTS GDP - Gross Domestic Product This report on the role of private sector for providing inclusive municipal services created by the team of UNDP Istanbul International Center for Private Sector in Development (IICPSD) in partnership with Istanbul Metropolitan Municipality. IFC - International Finance Corporation We wish to thank our researchers, partners, peer reviewers, editors, designers and interns for their dedication and high- ILO - International Labour Organization quality work. IMM - Istanbul Metropolitan Municipality The research team worked under the supervision of Gülçin Salıngan, Deputy Director of IICPSD, who ensured that the study benefited highly from valuable inputs, constructive comments and discussions from both public and private ISO - International Organization for Standardization sectors. We would like to extend our sincere gratitude to Dr. Hayri Baraçlı, Former Secretary General of Istanbul ISWM - Integrated Solid Waste Management Metropolitan Municipality; Faruk Kacır Former General Manager of Istanbul Ağaç ve Peyzaj A.Ş and Ümit Şahbaz, Head of Business Development, Istanbul Ağaç ve Peyzaj A.Ş. NGO - Non-Governmental Organization The research was carried out and authored by a core team composed of Ms. Gülçin Salıngan Deputy Director IICPSD, MDG - Millennium Development Goals Aslıhan Albostan, Research Analyst IICPSD and Gülşah Eker, Head of Solutions Mapping UNDP Accelerator Lab. The MOE - Municipal Owned Enterprise team members are recognized for their commitment and efforts in writing, updating, editing and assembling this report. IICPSD is grateful to its dedicated interns Çağın Bulakbaşı, Nazlı İlksavaş and Marta Vescovi who actively supported MSW - Municipal Solid Waste the publication preparations. ODA - Official Development Assistance We would like to thank the following people who graciously peer reviewed the publication and provided valuable OECD - Organization for Economic Co-operation and Development comments: Ben Slay, UNDP; Taimur Khilji, UNDP; Marco Kamiya, UN Habitat; Assist. Prof. Dr. Özge Nalan Bileşik, Yıldız Technical University; Pınar Akpınar, UN Volunteers; Barış Timur United Cities Local Governments-Middle East West PPP - Public Private Partnership Asia Section, Oguzhan Akinc, Interaktif Cevre Company Kibar Group Companies and Bilal Erol, Istanbul Metropolitan Municipality. SDG - Sustainable Development Goal SGEI - Services of General Economic Interest We also would like to thank the following people for their valuable inputs throughout our discussions: Mücahit Delibas and Rabia Hacıhaliloğlu , Istanbul Ağaç ve Peyzaj A.Ş; Uğur Karahan, Istanbul Metro A.Ş; Ramzan Özcan Yıldırım, SME - Small and Medium Enterprises Istanbul Metropolitan Municipality Corporate Development Department; Elif Aynur, Istanbul Metropolitan Municipality, Solid Waste Management Department; Jean Baptiste Buffet, United Cities Local Governments; Salim Korkmaz UCLG- SOE - State-Owned Enterprise MEWA Section; Alexis Le Coutour , European Centre of Employers and Enterprises Providing Public Service and Volkan UNDP - United Nations Development Program Ural, Interaktif Çevre Company, Kibar Group Companies. UNHCR - Office of the United Nations High Commissioner for Refugees WBG - The World Bank Group 2 ENGAGING THE PRIVATE SECTOR FOR INCLUSIVE URBANIZATION: The Role of Municipally Owned Enterprises 3 PREFACE FOREWORD The United Nation 2030 Agenda targets to transform the Cities more sustaianble, inclusive and resilient. To achive the The rapid rate of urbanization makes the cities critical entry point to address the development challenges. These targets of the 2030 Agenda; we have to fullfill our instutional and personal responsibilities. As Istanbul Agac ve Peyzaj challenges must be met with innovative and competitive solutions that simultaneously satisfy the needs of the society, A.Ş, we carry out the green area landscaping and afforestation activities in Istanbul in line with the vision of Istanbul economy and environment The UNDP Sustainable Urbanization Strategy1 highlights sustainable urbanization as setting Metropolitan Municipality. Our primary goal in green field works is to add value to the city view of Istanbul with a the right policies to ensure that no one is left behind, every person enjoys the benefits of urban growth and has sustainable landscape approach and to improve the quality of the life of the city dwellers. access to infrastructure and social services. To achieve this target; there is an urgent need for collective action where it concerns all actors, from public to private sectors. While creating new green spaces, it is our principle policy to ensure that the people of Istanbul meet with nature, reach out the green spaces easily. Within this frame we produce the necessary planting material in cooperation with our Private sector, private foundations and for-profit institutions have been playing a historical role in development, both local producers. Inline with our principle, we keep Research and Development activities in innovative approaches in by providing funding and being engaged in different ways including large infrastructure projects. But the need for agriculture and provide technical support to local producers. contributions from the private sector to the development agenda are becoming more significant. IICPSD’s global service offer related to its work with the private sector, which can be adopted to contribute to UNDP Sustainable With the partnership with UNDP we aim to repllicate and scale up our inclusive business models, capacity building Urbanization Strategy. This Report examines the role of private sector in building inclusive, sustainable and resilient training programs and innovative approaches in landscape. It is our pleasure to take place in this report as one of the cities for achieving the 2030 Agenda with an entry point of Municipally Owned Enterprises (MOEs). good practices of Municiple Owned Enterprises which takes a role in development by investing in Green Spaces by providing resilience and inclusion. I would like to state our intetion to share our know-how and expertise to replicate our IICPSD is well-positioned to encourage and support capacity development of MOEs to create and leverage the capacity Companies good practices in cities where there is a need and gap. and creating an ecosystem for attracting other private sector in basic municipal services which help tackling with urbanization challenges at local level. The global practices in the