Africa urbanisation key to economic growth

NAIROBI (HAN) May 24.2016. Public Diplomacy & Regional Security News. BY: Berna Namata. With two-thirds of Africans expected to live in cities by 2050, how the continent urbanises will be critical to its growth and development, the African Development Bank (AfDB) said Monday.

In its African Economic Outlook 2016 released on Monday during its 51st annual meeting in Lusaka, Zambia, the AfDB also said that Africa’s economy held firm last year amid global headwinds and regional shocks. The continent remained the second fastest growing economic region after East Asia.

According to the report, Africa’s economy is expected to grow 3.7 per cent this year and pick up to 4.5 per cent in 2017, provided that the world economy strengthens and commodity prices gradually recover.

“African countries, which include top worldwide growth champions, have shown remarkable resilience in the face of global economic adversity,” Abebe Shimeles, AfDB’s the acting director Development Research Department said.

“Turning Africa’s steady resilience into better lives for Africans requires strong policy action to promote faster and more inclusive growth,” he added.

According to the report, lack of urban planning leads to costly urban sprawl.

In Accra, Ghana, for example, the population nearly doubled between 1991 and 2000, increasing from 1.3 million to 2.5 million inhabitants at an average annual growth rate of 7.2 per cent. During the same period, the built up area of Accra tripled, increasing from 10 thousand hectares to 32 thousand hectares by an average annual rate of 12.8 per cent.

But two-thirds of the investments in urban infrastructure until 2050 have yet to be made. This presents a window for wide-ranging urban policies to turn African cities and towns into engines of growth and sustainable development for the continent as a whole.

“Africa’s ongoing, multi-faceted urban transition and the densification it produces offer new opportunities for improving economic and social development while protecting the environment in a holistic manner. These openings can be better harnessed to achieve the Sustainable Development Goals – especially SDG 11 on sustainable cities and communities – and the objectives of the African Union’s Agenda 2063,” said Mario Pezzini, the director and acting director of the OECD Development Centre and the OECD Development Co-operation Directorate respectively.

With adequate policies, analysts see urbanisation as key to helping advance economic development through higher agricultural productivity, industrialisation, services stimulated by the growth of the middle class, and foreign direct investment in urban corridors.

It also can promote social development through safer and inclusive urban housing and robust social safety nets.

“The benefits could accrue for both urban and rural dwellers, provided governments adopt an integrated approach,” Mr Pezzini said.

This approach, experts say, includes stepping up investment in urban infrastructure, improving connectivity with rural areas, better matching formal real estate markets with the housing demand by clarifying land rights, managing the growth of intermediary cities, and improving the provision of infrastructure and services within and between cities. Such investments need to be accompanied by productive formal employment – especially for the youth – and sufficient public goods.

The report notes that Africa’s youth is particularly at risk from slow human progress. In sub-Saharan Africa, nine out of ten working youth are poor or near poor.

“We need to invest in building economic opportunities, especially those of women of which 92 per cent work in the informal sector. Cities and towns have a key role to play in that process, but only if governments take bold policy action,” said Abdoulaye Mar Dieye, the director of the Regional Bureau for Africa at the United Nations Development Programme.According to the report, seizing this urbanisation dividend requires bold policy reforms and planning efforts. For example, tailoring national urban strategies to specific contexts and diverse urban realities and patterns is essential.




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