Urban Development

As the world undergoes the largest wave of urban growth in history, there is a tremendous opportunity to improve the lives of the more than one billion poor people living in cities.

Our work in Urban Development explores ways to help the urban poor improve their economic, health, and social well-being. We work in many cities and municipalities around the globe to support sustainable solutions enabling the poor to have a more meaningful voice in the planning and implementation of urban poverty alleviation programs.

The world’s cities are growing rapidly.

• For the first time in history more than half of the world’s people live in cities. Over 90 percent of urban growth is occurring in the developing world, adding an estimated 70 million new residents to urban areas each year. During the next two decades, the urban population of the world’s two poorest regions, South Asia and Sub-Saharan Africa, is expected to double.
• As the world’s population shifts to cities, poverty is increasing more rapidly in urban areas than in rural areas. By 2050, it’s estimated that 2.6 billion people – twice the population of today’s China – will live in cities struggling to meet basic human needs.
• Most of the growth is occurring in smaller towns and cities, which have fewer resources to meet the needs of the new influx of residents.

There is a pressing need to provide housing, health, and social services for the urban poor.

The scale and pace of urban growth and its often unplanned nature expose five critical problems that propagate the cycle of urban poverty: insecure and inadequate housing, lack of access to basic services, ineffective governance, paucity of income opportunities, and limited availability of municipal financing.

Although urbanization increasingly concentrates poverty, it also provides possibilities for escaping it.

Nations with the best economic performance over the last 40 years are those with the largest rural to urban migration. Cities generate jobs and income. With good governance, they can deliver education, health care and other services more efficiently than less densely settled areas simply because of their advantages of scale and proximity. Cities also present opportunities for social mobilization and women’s empowerment.

The most successful improvements to address the problems of poverty are being driven bottom up by the urban poor themselves.

Traditional urban poverty alleviation projects champion a top down approach that largely benefit the middle and upper classes in cities, further increasing inequities. The best urban projects are those which are created by the urban poor, take action within their communities, and work together with government to find solutions to urban poverty.

We aim to improve the lives of the urban poor by giving them the tools to lift themselves out of extreme poverty and create livable and prosperous cities in the developing world. Our work focuses on three priorities:

• Building the capacity of organizations working on-the-ground with the urban poor
• Integrating the voice of the poor into the urban planning process
• Building city-level partnerships

Next: Our Approach

We believe that investing in the lives of the urban poor has the potential to directly address inequities that perpetuate poverty in the developing world. Since 2007, we have committed more than $150 million to promote new tools and models for long term urban poverty alleviation in Africa, Asia, and Latin America. Our grants are currently focused on these three areas:

• Building the capacity of organizations working on-the-ground with the urban poor
• Integrating the voice of the poor into the urban planning process
• Building city-level partnerships

Strengthening Community-Level Organizations

We are exploring whether and how increased capacity within the urban community could lead to more sustained impact on the lives of the poor. Some examples of our work include: A $10 million grant to Slum Dwellers International helped create the Urban Poor Fund International, a self-governed financial facility that provides capital to slum dwellers savings federations undertaking community-level urban improvement and housing projects. A $15 million grant to the World Bank’s Cities Alliance focusing on land, citizenship and services that works at the national level on urban poverty alleviation programs in Uganda and Ghana, and will soon expand to two more countries. This grant allows national governments to engage with their local counterparts and directly with organizations of the urban poor to allocate land and improve service delivery.

Promoting Livelihood Opportunities for the Urban Working Poor

We also focus directly on improving the working lives of the urban poor. Our work in this category includes: A $40 million package of grants comprising the Global Project on Inclusive Municipal Planning for the Working Poor, aims to improve the livelihoods of more than 100 million urban working poor, many of them employed in the informal economy as waste pickers, street vendors and home-based workers. A $10 million grant to the UN Economic and Social Commission for Asia and the Pacific (UNESCAP) and Waste Concern is introducing a new mechanism for building the capacity of cities and citizens to sustainably process urban organic waste in 13 countries in Asia, helping to create jobs, reduce municipal costs, improve health and transform urban environments.

Building City-Level Partnerships

Our newest effort involves working directly with city governments and their communities to create sustainable and inclusive municipal processes, structures, and institutions that deliver new or improved jobs or services for the urban poor. While we are still testing this approach to urban poverty alleviation, we believe it could serve as a model for cities across the developing world to follow.