STATE OF THE WORLD'S CITIES 2012/2013 Prosperity

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participation and erodes the relationships between the citizenry and the level of government closest to them. 7 Box 3.1 highlights how decentralization can play a key role in the prosperity of cities. While the responsibilities of municipal governments have increased following reforms in recent years, many have no access to the financial resources needed to undertake these functions. This naturally creates a mismatch between responsibilities and financial resources, and is a major reason why decentralization has been less than successful in certain countries. National reforms relating to various aspects of decentralization – revenue allocation, community participation, local elections, local planning, pro-urban development strategies – all provide the enabling environment for cities to prosper. Box 3.1.1 Decentralization and the prosperity of cities A major benefit of decentralization as it relates to the prosperity of cities is that delivery of essential services such as water, sanitation and waste management, health and education can be carried out more effectively. Decentralization can make for better service delivery by providing greater opportunities for community-based groups to lobby for improved services. Proximity to physical demand for a service encourages effectiveness and promotes a more rational use of resources, while also allowing for closer monitoring by the beneficiary population of projects intended to serve them. The devolution of authority can foster community participation, too. Decentralization can lead to an institutional framework through which various political, religious, social, ethnic groups and multi-levels including towns and cities, can participate in making decisions that will affect them. Decentralized decision-making can provide a better framework for poverty reduction, so long as it is accompanied by fiscal devolution of powers to municipal authorities. Decentralization can accelerate economic development through active engagement of regional and municipal government units and local enterprises in economic activities. The transfer of authority and resources to local units of government and administration to design and implement programmes provides more opportunities for local citizens to play a more direct role in the development process. As catalysts for development and local change agents, they can make decisions about location of services and determine priorities. Source: UN-Habitat (2012) Decentralization in Iraq: Challenges and Solutions for Federal and Local Governments, Nairobi: UN-Habitat 95 POLICy System that creates equal opportunities The importance of this factor is most pronounced in Arabs States compared with other regions. This is because Arab States are one of the most egalitarian in terms of income distribution in the developing world. This is reflected in an overall (low) Gini coefficient of 0.36, which has been declining over time. 9 The low degree of inequality in the region has been attributed to a From Comparative Advantage to Urban Prosperity For decentralization to strengthen urban authorities’ commitment to urban prosperity, it must be backed by fiscal devolution. strong, cohesive social system, and the fact that redistribution constitutes a policy priority in Islamic economies. 10 A system that creates equal opportunities for all can use redistributive policies that give priority to low-income groups and areas. In Venezuela, the government has used redistributive policies to bring significant improvements to the living standards of the urban poor through massive investment in health and education. 11 With the provision of over 8,000 clinics in the barrios, people are able to access health services 24 hours a day at no cost. Similarly, illiteracy has been eliminated, pupils are no longer restricted to elementary school, and those with the required academic qualifications can attend university. Another form of redistribution policy involves conditional cash transfers. These enhance the human capital of beneficiaries through transfers which are made POLICy POLICy Decentralization works well when backed by strong commitment and support from central government. 8 FACT A system that guarantees equal opportunities for all is the third important factor underlying the prosperity of cities. The more egalitarian a city, the more prosperous it becomes. For a city to be truly prosperous, it must deploy systems that will ensure equal opportunities for all, especially the more vulnerable – the poor, women, children, the elderly, youth and the disabled. A prosperous city is one where the aspirations of all segments of the population are realized. Highly unequal cities are a ticking time bomb waiting to explode.
State of the World’s Cities 2012/2013 conditional on certain requirements such as school attendance, visits to clinics and periodic immunization. 12 Brazil’s Bolsa Família scheme, which benefits 11.1 million families, is the largest of its kind in the world, and has contributed to reducing poverty and inequality. 13 Indeed, 80 per cent of Bolsa Família benefits go to families living below the poverty line; the programme also accounted for 21 per cent of the decline in inequality in Brazil between 1995 and 200414 Policies that – all of FACT promote the which contribute to making participation of civil society cities more prosperous. are perceived as the fourth most important factor behind enhanced urban prosperity. POLICy Participation of civil society has the potential to empower communities, build social capital, lead to better design of urban projects, and allow for citizens’ concerns to be incorporated into development strategies. POLICy Lessons from experience suggest that successful civil society participation is dependent upon certain preconditions such as: (i) a political system that encourages active citizenship and is committed to equity and remedial action; (ii) the legal basis for participation; (iii) available resources in terms of skilled and committed professionals, as well as well-resourced and empowered local governments; and (iv) informed and organized communities and stakeholders. 16 Civil society participation The perceived importance of participation of civil society varies across regions. It is seen by local experts as the second most important factor in Latin America and the Caribbean, while in Arab 96 States, it is the fifth important factor. This is not surprising, given that participation of civil society has very strong roots in Latin American cities, with the best-known participatory approaches being participatory budgeting and participatory planning. A classic example of participatory planning process in Asia is the People’s Campaign for Decentralized Planning in Kerala (India), which strengthens democratic decentralization by identifying local needs and establishing local development options and priorities through local consultation and participation. 15 Elected local officials Research shows that durable democracy is correlated with economic development. 17 Across the world, the more prosperous cities (at least economically) tend to be located in countries that are stable democracies. Democratically elected local officials owe their mandate to the people, and as such, are best placed to respond to the people’s needs, which include providing good conditions for employment, Kerala, India: food security is critical for productivity. Ready access to a variety of wholesome food enhances quality of life. © 2012 Peter Herbert/fotoLIBRA.com
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PRODUCTIVITY ENVIRONMENTAL SUSTAINA
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Copyright © United Nations Human S
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Foreword This is a time of crises.
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Acknowledgements CORE TEAM Director
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Chapter 1.1 Conceptualizing Urban P
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State of the World’s Cities 2012/
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Part Two
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Chapter 2.1 Productivity and the Pr
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Urban Population (’000) Level of
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