Official Bank Sites Related Information June 21, 2006—Satellite images of cities around the world tell a story that could be titled, Urban Sprawl. From Accra, Ghana, to Alexandria, Egypt, to Bandung, Indonesia, most cities are expanding faster than their populations are growing, say World Bank researchers who studied changes that occurred in 120 cities over a decade. Urbanization is no longer a phenomenon for rich countries only. In the next year or so, the world will cross a threshold where more than half the population lives in cities. Projected population growth will, for all intents and purposes, take place in cities, mostly in cities of the developing world. In the next 30 years, the number of people living in cities in developing nations is expected to double from 2 billion to 4 billion, at a rate five times faster than the urban populations of industrialized countries. By 2030, Africa and China each will add over 400 million new urban residents, and India will add about 300 million. The cities themselves will triple in area, increasing the cost of needed infrastructure, resources, and other costs of urbanization, says Katherine Sierra, World Bank Vice President for Infrastructure. Sierra traveled to the World Urban Forum in Vancouver, Canada, June 19 to 23, to convey the World Bank’s message on the rapid urbanization of the world. There is little that countries and the international community can do to reverse the trend towards urbanization in developing countries, says Sierra. Unless steps are taken to prepare cities, new growth will result in unplanned expansions of “existing slum settlements—poorly located, unserviced ghettoes, often on the urban periphery,” says Sierra. It's time, she says, to “accept the reality of urban expansion—to set aside the debate about whether it's good, bad, or otherwise, and to get ready.” Planning Needed The Bank’s urban development group has abandoned the idea that the problems of cities—such as slums, disease, lack of clean water and sanitation—can be reduced by halting or reversing migration to cities, says Senior Urban Development Specialist Robin Rajack. “Rather than advocate strong incentives to remain on the farm, the urban group is thinking, let’s prepare for this next wave of urban population,” he says. Cities that experience both population and economic growth “inevitably” expand, argues a 2005 study, The Dynamics of Global Urban Expansion, by Shlomo Angel, Stephen C. Sheppard, and Daniel L. Civco. “As incomes grow, people want more space, so the land cities occupy is growing more quickly than population to accommodate this rising standard of living,” says Patricia Annez, an Urban Advisor in the Transport and Urban Development Department. But countries shouldn’t necessarily seek to stop the growth of cities, says Annez. “Rapid economic growth takes place in cities,” she says. “All of the major countries that have grown faster in per capita terms than the United States over the last 20 years have had flourishing growth in the urban sectors—services and manufacturing—much higher than in agriculture. In China, these sectors have grown at rates more than twice the growth rate of agriculture. “Countries do not grow out of poverty without urban growth,” Annez adds. “At the end of the day, growth in cities, rather than being seen as a bad thing, is a necessary element of a vibrant economy. But it does need to be managed.” The key questions for local, national and international decision makers are how big the expansion of cities is likely to be and what needs to be done to prepare for it, says the Global Urban Expansion study. The study estimates that at the current rate of growth, governments of developing countries would have to build, on average “a new city of 1 million people every week for the next 40 years.” But few governments are actively preparing for urban population growth, partly because the “planning horizons of politicians are too short to engage in longer-term planning and preparation for orderly urban expansion,” and partly because of prevailing anti-urban growth attitudes, the study says. Existing vs. Future Needs The study charges that organizations such as the World Bank, regional banks, and the United Nations have not had “critical dialogues” with countries nor designed and implemented “effective investment programs to meet this challenge.” “The mistakes of the past stare us in the face. They need not be repeated. Humanity has indeed been given a second chance: we now need to build new urban areas yet again that are at least equivalent in size to the cities that we have already built, we need to do it better, and we need to do it in a very short time.” The prospect of undertaking major infrastructure projects and implementing urban plans seems daunting for local governments faced with large numbers of poor people who need services and housing, Rajack says. “How do you persuade the mayor not to focus on existing need, but to focus instead on the future wave of population, when there is so much need in the existing community, and when resources are scarce?” asks Rajack. “It's a catch 22 situation, but the reality is that if we don't do it, we're going to forever be in a catch 22 situation.” Bank's Efforts Since the Bank created an urban development group in 1972, it has lent about $25 billion for projects designated as urban. Bank lending in other areas, such as health, education, power, and transportation, also reaches urban areas. In 2005, the Bank lent about $7.1 billion to projects benefiting cities. But the Bank is a relatively small player in urban finance, says Lead Economist Larry Hannah. It can wield influence through its ideas, calls for action, and relationships with non-governmental organizations and local governments, he says. The Bank has helped governments develop better policies to address pressing issues like affordable housing, by “working with market processes rather than against them, and targeting scarce government resources to subsidies that can reach large numbers of the urban poor,” says Annez. “Cost-effective programs like slum upgrading that provide key infrastructure rather than expensive subsidized housing that cannot be replicated on a broad scale, have helped millions,” she says. Slums develop partly because of the high cost of urban land in poor countries. In Dhaka, Bangladesh, a city projected by the UN to have 22.8 million people by 2015 and where a third of the population lives in slums, land prices approach that of real estate in the suburbs of Manhattan, Annez says. But often even these poor conditions in the city offer advantages over the alternatives in the countryside, she says. Families that migrate to Dhaka are able to increase their monthly household spending by an average of 40 percent, according to recent Bank study on urban poverty in Bangladesh. The incidence of poverty in Dhaka has declined by nearly 15 percentage points, in spite of rapid population growth, notes Annez. “The opportunity is to take advantage of the global urban expansion to alleviate poverty as we know it, raising the quality of life for all,” says Sierra. “Our commitment may require understanding complex systems, but our approach to solving problems needs to be simple.” |
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