This is a traditional quill stem#/media/File:Quill_stems.JPG), meaning it's shaped like a "7", with the vertical part fixed inside the steerer tube by a wedge bolt.
There should be an allen bolt at the top--it looks like it might be covered by a rubber plug here. Loosen that and give it a light tap with a mallet to dislodge the wedge. You should then be able to raise the stem. If you can't raise it as high as you want, you could replace it with a new stem that's taller.