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Is there a need for DFID's urban programming to be more politically smart and locally led?

DFID-funded urban programming, while increasingly important, has not been as effective as it could be, facing challenges in meeting targets and promoting sustainable change. Palladium’s Harry Jones and Jehanzeb Khan explore opportunities for better urban development.

The clear and consistent lessons that emerge from this work is the need to better ensure urban programmes are politically smart and locally-led. Some simple steps would enable DFID to get a handle on this problem and begin to strengthen programming across its urban portfolio

Background
Poverty is urbanising. At least one billion people worldwide currently live in slums and informal settlements, and traditional poverty metrics mean the full extent of urban poverty is underestimated. Whatever the current level, it is undoubtable that urban poverty is fast increasing, and the vast majority of urban growth between now and 2050 is going to occur in developing countries.

Cities are central to a country’s development more broadly. Cities have a great potential to drive economic growth and transformation thanks to the productivity increases associated with urban clusters and agglomeration effects. However for the majority of cities in the developing world this growth potential has yet to be capitalised upon despite rapid urbanisation. Moreover if the cities are not managed well, there is a potential for serious negative impacts including environmental problems, and increasing vulnerability and resilience.

Strong and functional institutions are central to ensuring productive and inclusive cities. Shortfalls in public investment, insufficient or low quality infrastructure and services, and unregulated development are in many cases symptomatic of underlying institutional challenges, governance constraints or political economy problems. In contexts with weak government, delivering public goods and tackling market failures such as externalities faces collective action problems. In some cases rapid urbanisation has outpaced the ability of government and administrative systems to keep up, while in other cases under-development serves the interests of particular elite groups, who profit from or gain political benefits from informal settlements, for example. There are some unique challenges presented by the political economy of urban development, with constraints posed by the complexity and heterogeneity of urban landscapes and the value of rents available; there are also some opportunities and potentials unique to urban contexts.

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