· The Human Settlements Conditions of the World's Urban Poor Table of Contents Preface Executive summary I. Introduction II. The concept and scale of urban poverty III. The urban

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The Human Settlements Conditions of the World'sUrban Poor

Table of Contents

Preface

Executive summary

I. Introduction

II. The concept and scale of urban poverty

III. The urban economy

IV. Trends in the human settlements conditions of the urban poor

V. Reaching the urban poor

VI. Reducing the human settlements problem of the urban poor

VII. Agenda for future work

VIII. Conclusions and recommendations

I. Introduction

A. The growth of human settlements

B. The urbanization of poverty

C. The challenge of the human settlements conditions of the world surban poor

II. The concept and scale of urban poverty

A. Income and housing poverty

B. The scale and characterization of urban poverty in developingcountries

C. Regional experiences of urban poverty

o 1. Asia

o 2. Sub-Saharan Africa and Latin America and the Caribbean

D. Concluding perspective

III. The urban economy

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A. The economic role of cities

B. Urban bias and post-1980 changes

C. New directions in urban economic development and policyframeworks

D. The productivity of housing

E. Conclusions

IV. Recent trends in the human settlements conditions of the world s urbanpoor

A. Latin America and the Caribbean

o 1. Urbanization and the growth of human settlements

o 2. The nature and extent of urban poverty

o 3. Housing and environmental conditions

o 4. Other infrastructural provision

o 5. Land availability

o 6. Summary

B. Sub-Saharan Africa






o 6. Summary

C. North Africa and the Middle East





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o 5. Summary

D. South Asia






o 6. Summary

E. India






o 6. Summary

F. East Asia and the Pacific






o 6. Summary

G. China




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o 6. Summary

V. Reaching the urban poor

A. The changing international policy context for urban development andshelter

B. The sites-and-services programme in Zimbabwe

o 1. The mobilization of financial resources and the question ofaffordability

o 2. The social impact of the programme

o 3. Conclusions

C. Brazil: the FUNACOM programme in Sao Paulo

o 1. The mobilization and allocation of resources

o 2. The organizational arrangements and the process ofself-management

o 3. The impact of the FUNACOM programme

o 4. Conclusions

D. An evaluation of the Employees Housing Programme (EHP) in theRepublic of Korea

o 1. The resource base for the EHP

o 2. The social impact of the EHP

o 3. Conclusions

E. India: An evaluation of a series of Slum Improvement Programmes

o 1. The scope of the Slum Improvement Projects (SIPs)

o 2. The social impact of the SIP projects

o 3. Conclusions

F. Conclusions: Assessing the experience of projects/programmesaimed at improving the human settlements conditions of the world s

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urban poor

VI. Reducing the human settlements problem of the urban poor

A. The scope for public/private partnerships

B. The potential for employment generation in human settlementsdevelopment through construction activity

C. The potential for employment generation from HBEs

D. Public participation and capacity-building

E. Increasing the access to residential land

F. Improving access to housing finance

G. Improving access to appropriate building materials

H. Improving infrastructure and sanitation

I. The effect of building and planning codes and regulations on thehuman settlements conditions of the urban poor

J. Renting as opposed to ownership: Options for the urban poor

VII. Agenda for future work

A. Countering urban poverty

B. Shelter, good governance and the enabling role

C. Specific policy areas in need of development

o 1. Improving the effectiveness of the land market

o 2. Encouraging the development of institutional housing finance forthe urban poor

o 3. The enhancement of local materials production

D. Strengthening shelter strategies for the poorest groups

E. Harnessing the benefits of research

F. The future role of local authorities

G. The role of CBOs and NGOs

H. The role of the private commercial sector

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VIII. Conclusions and recommendations

A. The incidence of urban poverty

B. The human settlements conditions of the world s urban poor

C. The shortcomings of past policies and initiatives for improving theconditions of the urban poor

D. The key principles of the GSS and the new agenda for development

E. Summary of recommendations

o 1. The supply of residential land

o 2. Sources of institutional housing finance

o 3. Improving access to, and affordability of, building materials forthe urban poor

o 4. The opportunities for employment generation

o 5. Encouraging the availability of accommodation for rent

o 6. Acknowledgement of the role of shelter also as a workplace

o 7. Encouraging partnerships between governments, local authoritiesand communities

Bibliography

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The Human Settlements Conditions of the World'sUrban PoorList of boxes

Box 1. Housing careers among the poor

Box 2. Living conditions of the urban poor

Box 3. Troops tread gently as takeover of Rio shanty towns gains pace

Box 4. SAPs and housing investment in Uganda

Box 5. The slum environment in Bangladesh

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Box 1. Housing careers among the poor

Preamble

The visual imagery of housing poverty in urban areas in developing countries is clear and wellknown. Fetid slums are widespread in the form of overcrowded tenements and ramshackle buildingserected by the poor on patches of invaded land. Living conditions are frequently unhealthy andhouseholds compete and struggle for work, for meagre incomes, for basic food, and for access to shelterand inadequate urban services. This visual imagery expresses part of the reality, and it is so plain andobvious that neither the relationship between poverty and housing nor the way that housing careers arepursued is adequately documented. Although the literature on housing in developing countries hasnumerous examples of sociological surveys of slums, of upgraded slums with improved urban services,and of sites-and-services projects, few authors go beyond the factual reporting of statistical categorieswhich shed some light on generalized living conditions. Consequently the housing literature has insufficientanalysis of the causal connections between housing poverty and income, and it lacks a perspective onchanging housing careers among the poor.

By the late 1980s it was becoming increasingly obvious to international aid donors, topolicy-makers, and to housing observers that, notwithstanding extensive efforts to improve the livingconditions of the poor, the level of effective achievement in relation to need and expectations wasdisappointing. In their review of low-income settlements, Hardoy and Satterthwaite (1989) reported therealities on such issues as low-income access to housing policy performance, the health-housingrelationship, squatting, eviction, social segregation, and pollution. They found large gaps between whatactually happened in these matters and what policy-makers said should happen. The legal and institutionalstructure of government and its housing agencies were not coping; local government was deficient inresources and responsibilities; and in some instances the authorities bulldozed squatter settlements andrepressed the poor. Amidst living conditions where crowding, disrepair and insanitary environmentsprevailed, land rights were, nevertheless, traded in active commercial markets, even though manysettlements had their legitimacy in question among the urban governing authorities.

It is in the context of the foregoing that the housing careers of the poor have been experienced inthe 1950 to 1995 period. Below follows some examples of housing careers and life experiences indeveloping countries.

Monica Cheboi was born in 1968 in the rural area of the Rift Valley in Western Kenya. As achild she lived in a rural self-help house without piped water, windows and an adequate roof. Shemarried young and had a son in 1986. When her husband deserted the family Monica relocated toMombasa on the Kenyan coast, leaving her son in the care of her parents in the Rift Valley. She had ajob in the Kenyan telecommunications industry, but was retrenched under structural adjustment policies inthe early 1990s. Alone, Monica Cheboi first rented a room in a crowded courtyard house in Mombasa,later moving to a three-roomed rented house in a forest clearing some 15 km from Mombasa. Her workwas trading in second-hand clothing in the city markets, but her job in the Kenyan telecommunicationsector was later reinstated. Housing is important in Monica's life, and she has been willing to makesacrifices on other things in order to have private and individualized accommodation, absorbing over 30per cent of her income.

Carmen Gomez was born in 1950 in San Miguel Allende, some 80 miles north-west of MexicoCity. In her adult life Carmen's housing has been in self-help dwellings. Like Monica Cheboi, Carmen'smarriage broke up and she was left to bring up her two children working in an art gallery in San MiguelAllende, a town of 100,000 population. Over a period of some 20 years Carmen and her grown children(who have families) have added rooms to their self-help (squatter) house, to meet their needs and to fit

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their life styles. By the 1990s the municipal authorities had provided sanitation, electricity and waterservices to San Rafael, the squatter area where Carmen lives some 2 km from the centre of San MiguelAllende. It is estimated that some 70 per cent of Mexican households live in self-help housing, therebyliving rent-free and spending parts of their savings on incremental improvements to the dwelling. Since themid-1970s Mexican authorities have been more disposed to 'regularize' land tenure, purchasing land andselling it with legal title to the occupants. Housing improvements are thus a central feature in the lives ofmany poor Mexican households.

Sim Sock Lee was born in Singapore in 1969. Apart from the years 1990 to 1992 when SockLee studied for her postgraduate degree in Australia, she has lived in a public housing apartment built bythe Singaporean government's housing agency, the Housing and Development Board. The Housing andDevelopment Board built housing estates in high-rise form near the central area and in new towns. Thehousing was at cross-subsidized rents for the poor and in home-ownership tenure for moderate andmiddle-income groups. Sock Lee's family were able to buy their apartment from the Housing andDevelopment Board using their credits in the mandated social security fund, the Central Provident Fund.Some 80 per cent of Singaporean families live in Housing and Development Board housing which issanitary, modern and well integrated with urban development. Sim Sock Lee had a good education in theSingaporean education system, including in the Economics Department at the National University ofSingapore. Following her postgraduate education in Australia, Sock Lee obtained an appointment at theSingapore Polytechnic, teaching economics and finance. She is now preparing for marriage and thepurchase of a Housing and Development Board apartment.

Source: Pugh, C. in personal communications with Monica Cheboi, Sim Sock Lee and CarmenGomez, and study programmes of housing in Kenya, Mexico and Singapore.

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Box 2. Living conditions of the urban poor

UNCHS (Habitat) and ILO have earlier detailed "the horrors which face many millions of peopleevery morning when they wake from a mosquito-disturbed sleep. Their night may have been spent on amat in a room with four, six, or up to ten others, with inadequate ventilation (either because windows aretoo small or because they have been boarded up to prevent burglary as poor preys on poor), and anearthen floor which allows dampness to rise. Their morning ablutions will comprise either a wash fromtepid and cloudy water in a tin or a queue to use the only bathroom in a tenement house shared by 50 or100 people. The toilet queue is too long, so a visit to the rubbish dump to defecate in the morning mist, orto the Augean public latrine where privacy is marginally better, is in order. The working clothes arerescued from their place over a string extended above the bed and the man sets off on the routine ofqueuing for crowded transport to his place of employment many miles away, often without breaking hisfast.

His wife is left to feed the children on last night's left-overs or some rice porridge cooked in cloudywater over a charcoal stove on the floor by the door, then to do the household chores and fetch water,before she clears a small space and begins the daily business of preparing food for city workers, orlaundering clothes, or smoking fish, or sewing up garments for a manufacturer to export to Europe. Atdusk she cooks the day's meal, squatting on the floor before the round of washing her children from asoapy bowl in the space outside the room. On wet days, the whole household is caked in mud, on drydays, the dust blows into the food and water, carrying cysts and parasites to plague them. The earth onwhich they tread harbours parasites, eager to enter a human host through bare feet, the dusty air theybreathe brings hepatitis A and meningitis, the fumes within it come from the sulphuric acid plant at thecopper mine or the chemical works down the hill, adding coughs to malarial fever. Their water is abreeding ground for mosquito larvae, salmonella, shigella, and E. coli, sometimes in as high a density asfound in the human intestine .. waiting to strike the children down with malaria or diarrhoea. Theirneighbours on the steep slopes suffer added danger from land-slips in the heavy rain; down by the river,flooding is regular and brings added dangers from sewage and other pollutants. Such, and similar, are theliving conditions of poor people in the cities and towns of developing countries."

Source: UNCHS/ILO, 1995.

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Box 3. Troops tread gently as takeover of Rio shanty towns gains pace

"The Brazilian army's intervention in the slum suburbs of Rio de Janeiro moved into top gear at theweekend when more than 1,000 troops sealed off two of the city's biggest shanty towns.

In Mangueira, home to one of Rio's most famous samba schools, three tanks pointed theirgun-barrels at the densely populated hillsides as the soldiers entered the favela. One soldier was shotand slightly wounded by a lookout of the local drugs gang, the Commando Vermelho (Red Command).

Fifty-two people were arrested and taken for questioning to a special operations centre, where 24prominent judges have been detailed to supervise the army's interrogations.

Tanks were also placed at the entrances to Dende, on Governor's Island, which houses the city'sinternational airport. Locals were forced to kneel at gunpoint as they were searched for drugs and arms.Dende is another established fiefdom of the Red Command.

The occupations followed limited interventions on Friday evening in five smaller favelas borderingmiddle-class districts of the city, to put a halt to the normally thriving weekend cocaine trade.

The haul of the army operation, for which a total of 65,000 troops have been placed on alert, hasso far been limited. In Mangueira, two pistols, two revolvers, a grenade and 7 lb of marijuana wereseized on Saturday. Nor have any of the top drug gangsters yet been taken. Indeed the prolonged'psychological' phase of army mobilisation which preceded the weekend interventions appears to havebeen designed to allow the top drug-runners to escape and thus reduce the likelihood of armedconfrontations in the densely populated favelas.

The army command stressed in its first communiqué of the operation that its success or failureshould be measured not by arms captured or drugs seized but by the eventual decline in the level ofviolence.

After soldiers barricaded the main entrances to the favelas, police special forces conducted asweep of the narrow alleyways before the army moved in to set up control points.

The army promises to have completed the pacification of the favelas by Christmas, restoring thestate's presence in districts which have been for several years no-go areas under the control of the drugtraffickers, and paving the way for unspecified 'social services' in the shanty towns.

So far the troops have met no significant resistance and have not opened fire. Residents said thesoldiers were asking permission to enter and search houses rather than forcing their way in.

The political opposition, headed by the Workers' Party leader Luis Inacio Lula da Silva, has notopposed the mobilisation, the biggest since the previous military regime left power in 1985, althoughseveral senior members have expressed strong reservations about the decision to enter the favelas.

"It is a lot of fireworks for little results", said a prominent parliamentarian, Jose Fortunati. "The realcauses of the violence are not being touched. The corrupt structure of the Rio police is being left as itwas".

Several lawyers have criticised the detention of people who could not produce identification, butothers have supported the action.

"The population is living in a state of total insecurity", the president of the São Paulo Institute of

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Lawyers, Rubens Approbato Machado, said."

Source: Guardian, 21 November 1994.

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Box 4. SAPs and housing investment in Uganda

The context for adjustment

The ascendancy to power of Amin in 1971 ushered in an era of economic mismanagement andrepression. Rival tribes were decimated; intellectuals and entrepreneurs terrorised; and natural resourcessquandered. The 'Liberation War' in 1979 inflicted further destruction on property, infrastructure andhuman life.

The aftermath of war was characterised by more civil strife, political intrigue, social unrest andeconomic disequilibria. In the meantime, however, the population over the decade had increased by 36per cent, rural-urban migration intensified and a series of demoralized public sector services providinghealth, eduction, utilities and shelter was overwhelmed.

External factors were also negative. Uganda suffered the full brunt of oil price increases in1973/1974; the adverse terms of trade in primary products reduced income from trade, and the politicalisolation of the country in the late 1970s was followed by the effects of global recession in the 1980s. Itwas against this background that Uganda embarked upon its Structural Adjustment Programme.

The adjustment programme

Adjustment in Uganda may be divided into two phases, the first between 1981 and 1984 and thesecond following 1987. The first phase involved exchange realignment, elimination of price controls, theremoval of subsidies, the increase of interest rates and the institution of produce price incentives. Whilethere was commendable success in terms of GDP growth, balance of payments and reduced inflation(and smuggling) the programme could not be sustained through 1984 due to scarce financial inflows,intensifying civil war and over reliance on the exchange rate.

The second phase involved the 1987 Economic Recovery Programme, supported by IMF'sStructural Adjustment Facility and an Economic Recovery Credit from the International DevelopmentAssociation (IDA). This programme was enhanced in 1989 and a second IDA Economic RecoveryCredit was approved in 1990.

The elements involved in the programme included liberalization of the foreign exchange market; theintroduction of user charges in public institutions and on utilities; liberalized commodity trade; theprivatization of some parastatals; the 'retrenchment' of some civil servants and the 'demobilisation' ofsoldiers. It has included periodic devaluation of the currency and the removal of price controls. Reformsin revenue collection have been effected and tough monetary and fiscal measures instituted.

Impacts on the shelter sector:

The effect of the SAP and other macro-economic measures has been to create an economicenvironment which has adversely impacted on the shelter sector in a number of ways:

By reducing public subsidies to agriculture and reducing support for publicly provided ruralservices, the SAP has fuelled rural-urban migration effectively, leading to a doubling of the urbanpopulation in twenty years. The effect of the SAP, therefore, has been to compound the problemsassociated with rapid urbanization.

Currency devaluations and inflation (40 per cent in 1991/1992) have increased the cost ofconstruction materials. Even locally produced materials, such as cement, have increased four or five timesin price between 1988 and 1993. The SAP has encouraged the process of land 'commodification'. Land

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prices have spiralled, sometimes more than doubling in price between 1989 and 1991.

The imposition of tight monetary controls and in particular the adherence to a 'positive' interest rate(i.e. a rate higher than inflation), has rendered the terms and conditions for borrowing money prohibitiveto all but a few.

The effects of these increases in costs (in materials, land, and the cost of borrowing), together withthe general financial climate of job losses and contracting investment, have stifled investment in the sheltersector, thereby negating the effectiveness of a shift towards a private-sector led shelter strategy.

The SAP has further undermined (indeed accelerated), the incapacity of state organizations toperform their role in the shelter delivery process. It has effectively discontinued the direct provision ofaccommodation (through the National Housing and Construction Corporation); it has reduced thecapacity of State agencies to provide essential services such as water, electricity, sanitation andinfrastructure; and by increasing user charges for these services, it is reducing access for the urban poor.The overall effect of the policies and austerity measures introduced by the Uganda Governmentthroughout the 1980s, a series of measures strongly influenced by the IMF, has been to createcircumstances in the shelter sector where the provision of adequate housing has become a luxury item forthe Ugandan citizen.

Source: Nuwagaba, 1994.

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Box 5. The slum environment in Bangladesh

The overwhelming first impression in a slum in Bangladesh is of dirt, and the slum dwellersthemselves see the dirt as a big problem. When asked about their problems they usually mention dirt firstand in almost every Slum Improvement Programme, the people spoke about dirt having been their majorproblem before the project came.

There are almost no paved roads or footpaths in the slums and in the rainy season mud is oftenknee-deep or worse. There is no organized drainage in slum areas so rivulets of dirty water and rawsewage trickle across paths and into living space, and stagnant filthy pools collect in low-lying areas.During the rainy season the raw sewage becomes indistinguishable from the surrounding mud.

There is no garbage collection, and there are no rubbish bins, so garbage is strewn everywhere andleft in festering heaps. Slum dwellers often work as trash pickers or in some other kind of recycling andbring garbage to their houses to carry on their work. Huge numbers of flies are attracted by the garbage.

In sweeper colonies (where the lower-caste population lives), pigs are usually kept, and they runfree throughout the slum area. In smaller towns, where slum conditions are less congested, chickens,goats, and even cows are kept. They are rarely penned in, and there is little concern about their faeces,although cow dung is often collected and used as fuel.

Source: Haaza (not dated).

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The Human Settlements Conditions of the World'sUrban PoorList of figures

Figure 1. World population (1950-2025)

Figure 2. Average annual population increase, urban and rural areas (1955-2025)

Figure 3. Average annual population increase, by region (1995-2025)

Figure 4. Average annual increase in number of households, by region(1995-2025)

Figure 5. Conceptualizing poverty

Figure 6. Share of population living in informal settlements, selected cities ofsub-Saharan Africa

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Figure 1. World population (1950-2025)

Source: Based on United Nations, 1994. Graphics by I. Jensen.

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Figure 2. Average annual population increase, urban and rural areas(1955-2025)


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Figure 3. Average annual population increase, by region (1995-2025)


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Figure 4. Average annual increase in number of households, byregion (1995-2025)


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Figure 5. Conceptualizing poverty

Source: UNCHS, 1994.

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Figure 6. Share of population living in informal settlements, selectedcities of sub-Saharan Africa

Source: Based on Mbogua, 1994.

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The Human Settlements Conditions of the World'sUrban PoorList of tables

Table 1. Urban population and level of urbanization, by region (1950-2025)

Table 2. Natural population increase and urban growth, by region (1975-2015)

Table 3. Labour force and production, by sector and region (1965-1990/1992)

Table 4. Income and production, by sector and region (1970-1993)

Table 5. Population growth rates, household growth rates, and household size,by region (1995-2025)

Table 6. Impact of economic reform on workers in four major reform patterns(types of transitions)

Table 7. Poverty in developing countries (1985-2000)

Table 8. Urban poverty in developing countries (1988)

Table 9. Poverty in developing countries, urban and rural areas, by region

Table 10. Profile of human deprivation: Urban-rural differences in access toservices, by region

Table 11. Various aspects of poverty in four Asian metropolises (1980-1982)

Table 12. Economic growth, selected countries of Latin America (1980-1992)

Table 13. Urban population and level of urbanization, selected countries of LatinAmerica and the Caribbean (1975-2025)

Table 14. Urban population growth, selected countries of Latin America and theCaribbean (1965-2025)

Table 15. Population growth, selected cities of Latin America and the Caribbean(1965-2015)

Table 16. The growth of self-help housing, selected cities of Latin America

Table 17. Urban population and level of urbanization, selected countries ofsub-Saharan Africa (1975-2025)

Table 18. Urban population growth, selected countries of sub-Saharan Africa(1965-2025)

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Table 19. Population growth, selected cities of sub-Saharan Africa (1965-2015)

Table 20. Distribution of water supplies and toilet facilities, Accra, Ghana

Table 21. Urban population and level of urbanization, selected countries of NorthAfrica and the Middle East (1975-2025)

Table 22. Urban population growth, selected countries of North Africa and theMiddle East (1965-2025)

Table 23. Population growth, selected cities of North Africa and the Middle East(1965-2015)

Table 24. Housing investments, Turkey

Table 25. Urban housing need and production, Turkey (1984-1989)

Table 26. The growth of squatter population and dwellings, Turkey (1950-1990)

Table 27. Urban population and level of urbanization, selected countries of SouthAsia, including India (1975-2025)

Table 28. Urban population growth, selected countries of South Asia, includingIndia (1965-2025)

Table 29. Population growth, selected cities of South Asia (1965-2015)

Table 30. Urban poverty projections, Bangladesh (1990-2000)

Table 31. Katchi abadis in Pakistan, by province (1988)

Table 32. Dhaka Metropolitan Areaa housing subsystems by location, incomegroup and land tenure.

Table 33. Housing programmes under the 1.5 Million Houses Programme, SriLanka (targets and performance)

Table 34. Utility services available in katchi abadis, Lahore, Pakistan

Table 35. Population growth, selected cities of India (1965-2015)

Table 36. Estimates of urban poverty, India (1970s and 1980s)

Table 37. Estimating the housing shortage, India, millions (1961-1991)

Table 38. Select indicators on the housing situation, India (1961-1991)

Table 39. Type of housing structures, by expenditure class, India (1983)

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Table 40. Prevalence and cost of rental housing, by expenditure class, India

Table 41. Urban population and level of urbanization, selected countries of EastAsia and the Pacific, including China (1975-2025)

Table 42. Urban population growth, selected countries of East Asia and thePacific, including China (1965-2025)

Table 43. Population growth, selected cities of East Asia and the Pacific(1965-2015)

Table 44. Official urban poverty lines, Indonesia (1976-1990)

Table 45. Urban housing shortage, Indonesia

Table 46. Quality of urban housing stock, Indonesia (1961-1983)

Table 47. Population growth, selected cities of China (1965-2015)

Table 48. Urban household income distribution (per cent of all households),China (1982-1988)

Table 49. Incomes and expenditures per capita, China (1982-1992)

Table 50. Incidence of urban poverty, China (1985-1987)

Table 51. Urban dwelling conditions, per household and capita, China(1982-1988)

Table 52. Urban household dwelling conditions (per cent), China (1982-1988)

Table 53. Basic conditions of urban public utilities, China (1965-1992)

Table 54. Housing units constructed under the EHP, Republic of Korea(1990/1991)

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Table 1. Urban population and level of urbanization, by region (1950-2025)

RegionUrban population

(millions) Share of population livingin urban areas (per cent)

1950 1975 1995 2000 2025 1950 1975 1995 2000 2025Latin America & Caribbean 69 196 358 401 601 41.6 61.3 74.2 76.6 84.6

Sub-Saharan Africa 20 70 184 233 661 11.3 21.0 30.8 34.0 51.4North Africa & Middle East 27 90 208 246 465 26.3 45.3 59.3 62.5 75.3

South Asia 11 33 82 105 284 9.9 16.8 25.4 28.4 47.6India 62 132 251 292 630 17.3 21.3 26.8 28.6 45.2

East Asia & Pacific 36 104 223 264 486 16.8 27.0 39.3 42.7 59.0China 61 160 369 443 832 11.0 17.3 30.3 34.5 54.5

Developing countries 286 785 1,675 1,983 3,957 17.0 26.3 37.4 40.5 56.9Industrialized countries 452 753 909 943 1,108 54.1 68.8 73.4 74.7 82.4

World total 738 1,538 2,584 2,926 5,065 29.3 37.7 45.2 47.5 61.1Source: Based on United Nations, 1994

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Table 2. Natural population increase and urban growth, by region (1975-2015)

RegionPercentage of urban population growth

due to natural population increase1975-1995 1995-2015

Latin America & Caribbean 65 70Sub-Saharan Africa 55 55

Middle East & North Africa 60 65South Asia 50 45

India 60 45East Asia & Pacific 45 45

China 30 25Developing countries 50 50

Note: The estimates are based on the assumption that the rates of natural population increase in rural andurban areas are identical.Source: Calculations based on United Nations, 1994.

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Table 3. Labour force and production, by sector and region (1965-1990/1992)

Regiona

Percentage of labour force inAgriculture

Industry

Services

1965 1990-1992 1965 1990-1

992 1965 1990-1992

Latin America & Caribbean 45 25 22 25 33 50Sub-Saharan Africa 78 67 9 8 14 25

Arab States 59 40 15 21 26 39South Asia 69 51 13 17 16 28

India 73 62 12 11 15 27East Asia 52 24 20 34 28 42

South East Asia & Pacific 70 58 10 14 20 28China 81 73 8 14 11 13

Developing countries 71 58 12 15 17 27Industrialized countries .. 10 .. 32 .. 58

World total .. 48 .. 18 .. 34a: The regions used in this table differs slightly from those used in the rest of this report: Djibouti; Somaliaand Sudan are classified as part of "Arab States" rather than "sub-Saharan Africa"; The Islamic Republicof Iran is classified as part of "South Asia" rather than "North Africa and the Middle East"; Turkey andCyprus are classified as part of "Europe" rather than "North Africa and the Middle East"; "East Asia andthe Pacific" is split in "East Asia" and "South East Asia and the Pacific"; and Israel is classified as anindustrialized rather than a developing country.Source: Based on UNDP, 1995.

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Table 4. Income and production, by sector and region (1970-1993)

RegionGNP/capita

1993($US)

GDP, 1993

Percentage of GDP from

Billionsof

($US)

Percent ofworldtotal

Agriculture

Industry

Services

1970 1993 1970 1993 1970 199

3Latin America &

Caribbean 2,950 1,406 6.08 12 .. 35 .. 53 ..

Sub-Saharan Africa 520 269 1.17 27 20 28 33 46 47Middle East & North

Africaa1,742 780 3.37 .. .. .. .. .. ..

South Asiaa 340 88 0.38 41 27 18 23 37 52India 300 225 0.98 45 31 22 27 33 41

East Asia & Pacifica 1,816 1,005 4.35 32 14 31 36 37 49China 490 426 1.84 34 19 38 48 28 33

Developingcountries a

998 4,199 18.17 .. 19b .. 34b .. 57b

Industrializedcountries a

15,594 18,913 81.83 .. .. .. .. .. ..

World total 4,420 23,113 100.00 .. .. .. .. .. ..a: Calculated on the basis of other data from the same source.b: Data from UNDP, 1995Source: Based on World Bank, 1995 (primarily); UNDP, 1995 (see note b).

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Table 5. Population growth rates, household growth rates, andhousehold size, by region (1995-2025)

Region

Average annualpopulation

growth rate (percent)

Average annualhousehold

growth rate (percent)

Averagenumber ofpersons

perhousehold

1995-

2005

2005-

2015

2015-

2025

1995-

2005

2005-

2015

2015-

20251995 2025

Latin America &Caribbean 1.59 1.43 1.28 2.70 2.55 2.37 4.31 3.32

Sub-Saharan Africa 2.80 2.72 2.64 2.54 2.70 2.86 5.99 5.57North Africa & Middle

East 2.23 2.10 1.90 2.86 2.84 2.74 5.59 4.72

South Asia 2.54 2.27 2.06 2.66 2.60 2.41 6.58 6.13India 1.70 1.53 1.33 2.32 2.29 2.16 5.62 4.69

East Asia & Pacific 1.55 1.36 1.20 2.55 2.38 2.22 4.48 3.54China 0.91 0.78 0.75 2.52 2.56 2.42 3.67 2.46

Developing countries 1.72 1.59 1.48 2.54 2.52 2.41 4.72 3.81Industrialized

countries 0.36 0.31 0.28 1.15 1.08 0.96 2.73 2.27

World total 1.44 1.34 1.25 2.09 2.08 1.98 4.07 3.43Source: Based on United Nations, 1994; UNCHS, 1996.

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Table 6. Impact of economic reform on workers in four major reform patterns(types of transitions)

Type of worker Industrialpostsocialista

Latin Americanb

Sub-SaharanAfricanc

Asianagrariand

Formal sector - + - -Informal sector + - + +

Urban + - - +Rural - + + +

Women +/- - - +Skilled workers + + + +

Unskilled workers - - - -Estimated number of

workers affected (millions) 195 155 70 1,000

a: Characterized by radical institutional reform, huge drops in GDP, and substantial redeployment of labouracross sectors and from the public to the private sector. Typical of former centrally planned economies.b: Combines stabilization and substantial liberalization, especially of trade. Associated with moderateredeployment of labour and some decline in GDP. Consistent with the experience of most Latin Americancountries, but also of some countries in the Middle East, North Africa as well as the Philippines.c: Normally preceded by macroeconomic decline. Characterized by profound restructuring within a smallmodern sector and by a relatively weak rural supply response. Typical of sub-Saharan Africa.d: Marked by steady growth in GDP, some institutional reform, and (over time) potentially a largeredeployment of labour. Typical pattern in primarily agrarian economies such as China, India and VietNam.Note: A plus sign indicates a gain, and a minus sign a loss, relative to the average worker.Source: World Bank, 1995a, pp. 98, 99, 107.

Page 32

Table 7. Poverty in developing countries (1985-2000)

RegionPercentage of population below

the poverty line a Number of poor (millions)

1985 1990 2000 1985 1990 2000Latin American &

Caribbean 22.4 25.5 24.9 87 108 126

Sub-Saharan Africa 47.6 47.8 49.7 184 216 304Middle East & North

Africa 30.6 33.1 30.6 60 73 89

South Asia (incl. India) 51.8 49.0 36.9 532 562 511East Asia (incl. China) 13.2 11.3 4.2 182 169 73

All developingcountries 30.9 30.2 24.3 1,046 1,128 1,103

a: The poverty line used ($370 annual income per capita in 1985 purchasing power parity dollars) is basedon estimates of poverty lines from a number of countries with low average incomes. In 1990 prices, thepoverty line would be approximately $420 annual income per capita. The estimates for 1985 have beenupdated from those in World Bank (1990) to incorporate new data and to ensure comparability acrossyears.Source: Adapted from World Bank, 1992.

Page 33

Table 8. Urban poverty in developing countries (1988)Region Number of poor (millions) Incidence of urban poverty (per cent)

Latin American & Caribbean 77.3 27Sub-Saharan Africa 55.5 42

North Africa & Middle East 59.5 34South and East Asiaa 136.5 23

All developing countries 328.8 28a: Including India and China.Source: World Bank, 1988a.

Page 34

Table 9. Poverty in developing countries, urban and rural areas, by region

Region

Percentage of population inabsolute povertya

(1980-1990)

Number of poorb

(1980-1990)(millions)

Total Urban Rural Total Urban RuralLatin American & Caribbean 40 31 61 180 95 85

Sub-Saharan Africa 54 23 65 300 35 260Middle East & North Africa 25 22 30 65 30 35

South Asia 52 26 59 155 25 125India 40 33 42 350 85 260

East Asia & Pacific East Asia 6 .. 11 5 .. 5

South East Asia & Pacific 35 24 40 165 35 130China 9 0 13 105 0 110

Total developing countries 31 28 c 37 1,300 300 1,000a: The number of people living in absolute poverty is based on absolute poverty lines in the countries,expressing in monetary terms the income or expenditure level below which a minimum, nutritionallyadequate diet plus essential non-food requirements are not affordable"b: Calculated on the basis of other data from the same source.c: The number of poor calculated on the basis of regional percentages as well as the total number of urbanpoor stated in the source, indicate that 21 per cent rather than 28 per cent of the urban population indeveloping countries are living in absolute poverty.Source: Based on UNDP, 1994.

Page 35

Table 10. Profile of human deprivation: Urban-rural differences in access toservices, by region

Regiona

Population (millions) without access toLife expectancy

at birth1992

(years)

Healthservices b

1985-93 Safe waterc

1988-93 Sanitationd

1988-93

Urbane Total Urbane

Total Urbane TotalLatin America &

Caribbean .. .. 30 90e 70 150e 68.6

Sub-Saharan Africa 30 200 40 270 60 290 51.3Arab States 0 40 10 60 60 70 62.8South Asia .. 150 10 100 30 210 59.9

India 0 130 40 190 90 650 60.4East Asia & Pacific .. 100e 40 240e 50 300e ..

East Asia .. 0e 0 20e 0 60e 71.5South East Asia &

Pacific .. 100e 40 220e 50 240e 63.9

China 0 120 0 370 140 990 68.5Developing countries .. .. 180 1,290 500 2,660e 63.2

Industrializedcountries .. .. .. .. .. .. 74.4

World total .. .. .. .. .. .. 65.7a: The regions used in this table differs slightly from those used in the rest of this report: Djibouti; Somaliaand Sudan are classified as part of "Arab States" rather than "sub-Saharan Africa"; The Islamic Republicof Iran is classified as part of "South Asia" rather than "North Africa and the Middle East"; Turkey andCyprus are classified as part of "Europe" rather than "North Africa and the Middle East"; "East Asia andthe Pacific" is split in "East Asia" and "South East Asia and the Pacific"; and Israel is classified as anindustrialized rather than a developing country.b: Health services access: "The percentage of the population that can reach appropriate local healthservices on foot or by local means of transport in no more than one hour."c: Safe water access = "The percentage of the population with reasonable access to safe water supply,including treated surface water, or untreated but uncontaminated water such as from springs, sanitarywells and protected boreholes."d: Sanitation access = "The percentage of the population with reasonable access to sanitary means ofexcreta and waste disposal, including outdoor latrines and composting."e: Calculated on the basis of other data from the same source.Source: Based on UNDP, 1995.

Page 36

Table 11. Various aspects of poverty in four Asian metropolises (1980-1982)Itema Manila Jakarta Calcutta Madras

Total population (millions of persons) 6.4 8.0b 9.2 5.0Area (km²) 646 550 800 1,170

Urban density (persons per hectare) 98 200 115 43Urban growth rate (per cent) 3.8 4.0 3.0c 3.5b

Average household size (number of persons) 5.4 5.0 5.1 5.2Average annual income ($ per capita per

year) 296c 132e 104b 104b

Absolute poverty level ($ per capita per year) 266d 124 132 132Percentage of population below absolute

poverty level 35 60 60 45

Percentage of population in substandardhousing (slums) 45 40 33 60

Percentage living in squatter or illegalsettlements 30 .. .. 25

Education levels (literacy rates) 85 78 65 66Percentage of labour force in the informal

sector 50 65 54 60

Percentage with access to water (homeconnection) 43 47 48 40

Percentage with daily garbage collection 70 25 55 78Percentage with access to human waste

disposal systems 60 42 45 58

a: Although the data are drawn from authoritative and reliable sources, they may not be internationallycomparable because of the lack of standardized definitions and concepts used by different countries incollecting data. The data are, nonetheless, useful to describe orders of magnitude, to indicate trends and tocharacterize certain significant differences among countries.b: 1975;c: 1980;d: 1982;e: 1984.Source: AsDB, 1994, p. 192.

Page 37

Table 12. Economic growth, selected countries of Latin America (1980-1992)

CountryAnnual growth in GDP (per cent)

1980-1984 1985-1989 1990-1992Argentina -3.0 -2.3 1.1

Brazil -0.5 2.5 -2.6Chile -0.1 4.8 4.2

Colombia -1.5 3.0 1.3Mexico -0.6 -1.2 1.4

Peru -2.4 -2.5 -3.8Venezuela -3.5 -0.9 6.1

Source: UNECLAC (quoted in Gilbert, 1994).

Page 38

Table 13. Urban population and level of urbanization, selected countries ofLatin America and the Caribbean (1975-2025)

CountryUrban population (thousands)

Per cent of population living in

urban areas1975 1995 2000 2025 1975 1995 2000 2025

Brazil 66,065 126,599 141,979 204,791 61.2 78.3 81.2 88.9Mexico 36,948 70,535 79,580 117,222 62.8 75.3 77.7 85.8

Colombia 14,434 25,526 28,447 41,532 60.7 72.7 75.2 84.1Argentina 21,029 30,463 32,762 43,083 80.7 88.1 89.4 93.4

Peru 9,319 17,175 19,437 30,653 61.5 72.2 74.5 83.5Venezuela 9,911 20,281 22,828 33,791 77.8 92.8 94.5 97.2

Chile 8,101 11,966 12,962 17,684 78.4 83.9 84.7 89.4Ecuador 2,926 6,698 7,833 13,456 42.4 58.4 61.9 75.6

Cuba 5,977 8,389 8,896 10,882 64.2 76.0 78.1 86.0Guatemala 2,211 4,404 5,394 13,389 36.7 41.5 44.1 61.8Dominican

Republic 2,289 5,051 5,789 8,890 45.3 64.6 68.1 79.6

Bolivia 1,975 4,505 5,432 10,370 41.5 60.8 65.2 79.0Haiti 1,069 2,266 2,775 7,076 21.7 31.6 34.9 53.9

South America 137,578 249,332 278,575 406,678 64.2 78.0 80.5 87.9Central

America 44,719 86,011 98,150 157,262 57.2 68.0 70.3 79.6

Caribbean 13,751 22,184 24,465 36,768 50.5 62.0 64.3 74.1Total 196,048 357,527 401,190 600,708 61.3 74.2 76.6 84.6

Source: Based on United Nations, 1994.

Page 39

Table 14. Urban population growth, selected countries of Latin Americaand the Caribbean (1965-2025)

Country

Average annual urban population growthPer cent

Thousands

1965-1975

1975-1985

1985-1995

1995-2005

2005-2015

2015-2025

1995-2005

2005-2015

2015-2025

Brazil 4.52 3.74 2.88 2.15 1.56 1.14 3,004 2,617 2,198Mexico 4.55 3.58 2.99 2.25 1.60 1.27 1,757 1,520 1,393

Colombia 3.84 3.19 2.59 2.07 1.61 1.23 580 543 477Argentina 2.17 2.03 1.71 1.41 1.16 0.92 459 428 376

Peru 4.59 3.49 2.72 2.40 1.94 1.50 461 462 425Venezuela 4.56 4.21 3.09 2.23 1.67 1.25 500 457 394

Chile 2.81 2.11 1.83 1.53 1.31 1.10 196 193 183Ecuador 4.34 4.74 3.71 3.00 2.31 1.75 230 231 214

Cuba 2.97 1.85 1.57 1.07 0.84 0.70 94 82 73Guatemala 3.60 3.21 3.80 4.17 3.95 3.21 222 313 363Dominican

Republic 5.54 4.48 3.59 2.54 1.81 1.36 144 128 113

Bolivia 2.80 4.22 4.20 3.58 2.76 2.12 190 200 196Haiti 3.92 3.62 4.04 4.12 3.95 3.53 113 161 208

SouthAmerica 3.83 3.35 2.68 2.11 1.61 1.22 5,781 5,310 4,643

CentralAmerica 4.45 3.55 3.10 2.51 1.96 1.62 2,425 2,367 2,333

Caribbean 3.39 2.57 2.27 1.90 1.70 1.50 460 491 508Total 3.94 3.34 2.76 2.19 1.70 1.34 8,666 8,168 7,485


Page 40

Table 15. Population growth, selected cities of Latin America and theCaribbean (1965-2015)

City

City population(thousands)

Average annual population growth (percent)

1995 2015 1965-1975

1975-1985

1985-1995

1995-2005 2005-2015

São Paulo, Brazil 16,417 20,783 4.8 3.1 2.0 1.5 0.9Mexico City,

Mexico 15,643 18,786 4.9 2.6 0.8 1.0 0.8

Buenos Aires,Argentina 10,990 12,376 1.9 1.2 0.7 0.7 0.5

Rio de Janeiro,Brazil 9,888 11,554 2.9 1.5 0.8 0.7 0.8

Lima, Peru 7,452 10,526 5.1 3.9 3.4 2.2 1.3Bogotá, Colombia 5,614 7,677 5.3 3.2 3.1 2.1 1.1

Santiago, Chile 5,065 6,255 3.0 2.5 2.0 1.3 0.8Belo Horizonte,

Brazil 3,899 5,540 5.3 3.8 3.2 2.3 1.2

Porto Alegre,Brazil 3,349 4,648 4.0 3.3 2.8 2.1 1.2

Recife, Brazil 3,168 4,381 2.9 2.2 2.7 2.0 1.2Guadalajara,

Mexico 3,165 4,209 4.8 3.2 2.2 1.7 1.2

Salvador, Brazil 2,819 4,134 4.4 3.7 3.5 2.5 1.3Fortaleza, Brazil 2,660 4,034 4.3 3.8 3.9 2.8 1.4


Page 41

Table 16. The growth of self-help housing, selected cities of Latin America

City Year City population(thousands)

Squatterpopulation

(thousands)

Squatters as percent

of city population

Mexico City1970 7,314 3,438 471976 11,312 5,656 501990 15,783 9,470 60

Lima, Peru1969 3,003 805 241981 4,601 1,150 251991 4,805 1,178 37

Buenos Aires, Argentina1970 8,353 434 51980 9,766 957 10

Caracas, Venezuela1964 1,590 556 351971 2,200 867 391985 2,742 1,673 61

Source: Gilbert, 1994.

Page 42

Table 17. Urban population and level of urbanization, selected countries ofsub-Saharan Africa (1975-2025)



urban areas1975 1995 2000 2025 1975 1995 2000 2025

Nigeria 14,676 43,884 55,751 146,948 23.4 39.3 43.3 61.6Ethiopia 3,061 7,371 9,516 37,929 9.5 13.4 14.9 29.9

Zaire 6,860 12,766 15,865 52,129 29.5 29.1 31.0 49.8South Africa 12,314 21,073 24,550 48,673 48.0 50.8 53.1 68.6

United Rep. ofTanzania 1,602 7,230 9,608 30,344 10.1 24.4 28.2 48.3

Kenya 1,775 7,817 10,347 32,616 12.9 27.7 31.8 51.5Sudan 3,033 6,915 8,742 27,075 18.9 24.6 27.3 46.4

Uganda 933 2,670 3,504 13,818 8.3 12.5 14.2 28.8Ghana 2,955 6,333 7,901 21,934 30.1 36.3 39.2 57.7

Mozambique 905 5,481 7,800 21,468 8.6 34.3 41.1 61.1Madagascar 1,253 4,003 5,308 17,378 16.1 27.1 30.8 50.5Côte d'Ivoire 2,168 6,211 7,869 23,611 32.1 43.6 47.0 64.1

Cameroon 2,022 5,938 7,521 19,504 26.9 44.9 49.3 66.9Zimbabwe 1,202 3,619 4,502 10,874 19.6 32.1 36.0 55.4

Malawi 402 1,505 1,894 7,083 7.7 13.5 15.6 31.7Angola 1,087 3,569 4,729 14,799 17.8 32.2 36.2 55.6

Mali 1,000 2,909 3,821 12,277 16.2 27.0 30.4 50.0Burkina Faso 394 2,809 4,386 14,376 6.4 27.2 37.5 66.4

Zambia 1,686 4,071 4,807 11,467 34.8 43.1 44.7 59.9Somalia 1,164 2,382 3,004 9,760 21.3 25.8 27.9 45.9

Niger 507 1,558 2,078 8,160 10.6 17.0 19.2 36.5Senegal 1,643 3,512 4,280 10,505 34.2 42.3 45.1 62.2Rwanda 175 483 610 2,367 4.0 6.1 6.7 15.0

Total 69,925 183,530 232,756 660,919 21.0 30.8 34.0 51.4Source: Based on United Nations, 1994.

Page 43

Table 18. Urban population growth, selected countries of sub-SaharanAfrica (1965-2025)

Country


Thousands

1965-1975

1975-1985

1985-1995

1995-2005

2005-2015

2015-2025

1995-2005

2005-2015

2015-2025

Nigeria 5.89 5.80 5.46 4.74 4.14 3.4

6 2,585 3,488 4,234

Ethiopia 4.68 4.43 4.56 5.40 5.95 5.49 511 976 1,570Zaire 4.12 2.59 3.72 4.68 5.18 4.54 741 1,327 1,869

South Africa 2.77 2.63 2.82 3.15 3.00 2.35 765 987 1,008United Rep. of Tanzania 9.98 9.13 6.54 5.65 4.88 4.17 529 764 1,018

Kenya 7.78 8.21 7.18 5.61 4.91 4.12 567 830 1,083Sudan 6.52 4.05 4.37 4.90 4.90 4.17 424 684 908

Uganda 6.00 4.85 5.95 5.58 5.76 5.55 193 345 577Ghana 3.77 3.45 4.32 4.56 4.43 3.69 356 537 667

Mozambique 9.04 11.27 7.61 6.40 4.02 3.57 471 492 635Madagascar 5.18 5.88 6.08 5.70 5.10 4.25 297 449 592Côte d'Ivoire 7.56 5.58 5.23 4.79 4.65 4.22 370 570 800

Cameroon 7.68 5.83 5.24 4.71 4.03 3.40 347 456 554Zimbabwe 6.44 5.83 5.50 4.33 3.79 3.08 191 249 285

Malawi 7.56 6.49 7.16 4.89 5.73 5.27 92 181 285Angola 5.31 6.05 6.20 5.54 4.84 4.20 255 369 499

Mali 4.90 5.22 5.75 5.49 4.99 4.28 205 311 420Burkina Faso 4.32 8.59 12.08 8.29 5.07 3.48 342 398 417

Zambia 7.18 5.24 3.78 3.40 3.64 3.50 162 244 334Somalia 3.50 4.61 2.69 4.86 5.10 4.48 145 247 347

Niger 7.37 6.04 5.51 5.93 5.87 5.23 121 213 326Senegal 3.32 3.92 3.82 4.03 3.87 3.26 170 241 288Rwanda 7.12 5.95 4.47 4.96 5.63 5.73 30 57 101

Total 5.08 4.93 4.96 4.79 4.44 3.86 10,953

15,956

20,830


Page 44

Table 19. Population growth, selected cities of sub-Saharan Africa (1965-2015)

City



1995 2015 1965-1975

1975-1985

1985-1995

1995-2005

2005-2015

Lagos, Nigeria 10,287 24,437 10.3 5.9 5.8 5.2 3.7Kinshasa, Zaire 4,214 9,855 8.2 4.8 4.2 4.1 4.6

Abidjan, Côte d'Ivoire 2,797 6,611 11.8 5.6 5.4 4.7 4.1Cape Town, South

Africa 2,671 4,508 3.5 3.7 3.3 2.8 2.5

Khartoum, Sudan 2,429 5,782 6.4 5.6 4.7 4.5 4.4Maputo, Mozambique 2,227 5,760 7.5 7.4 7.4 6.3 3.5

Addis Ababa, Ethiopia 2,209 5,850 4.5 4.8 4.0 4.6 5.4Luanda, Angola 2,207 5,548 7.8 6.4 5.9 5.1 4.3Nairobi, Kenya 2,079 5,361 6.9 5.2 6.3 5.3 4.4Dakar, Senegal 1,986 4,080 5.1 5.1 4.7 3.9 3.4


Page 45

Table 20. Distribution of water supplies and toilet facilities, Accra, Ghana Percentage of householdsSource of drinking water:

Inside plumbing 46 Water vendor and truck 23

Natural sources 13 Other 18

Type of toilet: Flush toilet 16 Pit latrine 27

Pan/bucket 20 Othera 37

a: Includes those without a toilet as well as those with facilities other than those mentioned.Source: Ghana Living Standards Survey, 1989 - cited by Songsore, 1992.

Page 46

Table 21. Urban population and level of urbanization, selected countries ofNorth Africa and the Middle East (1975-2025)



urban areas1975 1995 2000 2025 1975 1995 2000 2025

Islamic Republicof Iran 15,278 39,716 46,171 92,491 45.8 59.0 61.9 74.9

Egypt 16,877 28,170 32,054 60,519 43.5 44.8 46.4 62.2Turkey 16,651 42,598 50,701 79,102 41.6 68.8 74.8 87.0Algeria 6,460 15,591 18,586 33,675 40.3 55.8 59.7 74.1

Morocco 6,520 13,071 15,096 26,917 37.7 48.4 50.9 66.2Iraq 6,765 15,258 18,308 36,435 61.4 74.6 77.1 85.4

Saudi Arabia 4,257 14,339 17,388 37,618 58.7 80.2 81.8 88.2Syrian Arab

Republic 3,352 7,676 9,508 23,311 45.1 52.4 54.9 69.6

Yemen 1,147 4,877 6,550 19,674 16.4 33.6 38.4 58.4Tunisia 2,797 5,093 5,806 9,784 49.9 57.3 59.9 73.6

North Africa 34,199 66,744 77,401 143,323 42.6 50.4 52.9 68.2Middle East 55,918 141,619 168,274 321,311 47.1 64.7 68.1 78.9

Total 90,117 208,363 245,675 464,634 45.3 59.3 62.5 75.3Source: Based on United Nations, 1994.

Page 47

Table 22. Urban population growth, selected countries of North Africaand the Middle East (1965-2025)

Country


Thousands

1965-1975

1975-1985

1985-1995

1995-2005

2005-2015

2015-2025

1995-2005

2005-2015

2015-2025

IslamicRepubli

c ofIran

5.00 5.48 4.31 3.26 3.09 2.23 1,500 1,946 1,832

Egypt 2.77 2.61 2.58 2.69 2.72 2.34 856 1,131 1,248Turkey 4.59 4.72 4.90 3.13 1.81 1.32 1,537 1,142 972Algeria 3.71 4.88 4.13 3.38 2.46 1.96 615 598 595

Morocco 4.38 3.91 3.17 2.80 2.39 2.13 415 458 511Iraq 5.29 4.53 3.78 3.56 2.94 2.33 639 728 751

SaudiArabia 8.63 8.05 4.50 3.74 3.28 2.78 637 789 902

Syrian ArabRepublic 4.64 4.11 4.35 4.33 3.93 3.06 405 552 607

Yemen 5.94 7.40 7.61 5.77 4.66 3.86 367 493 620Tunisia 4.34 3.23 2.85 2.57 2.22 1.81 147 161 161NorthAfrica 3.66 3.59 3.21 2.95 2.59 2.20 2,252 2,604 2,802

MiddleEast 5.14 5.13 4.39 3.38 2.75 2.17 5,588 6,162 6,220

Total 4.55 4.57 3.99 3.25 2.70 2.18 7,840 8,766 9,021Source: Based on United Nations, 1994.

Page 48

Table 23. Population growth, selected cities of North Africa and the Middle East(1965-2015)

City



1995 2015 1965-1975

1975-1985

1985-1995

1995-2005

2005-2015

Cairo, Egypt 9,656 14,494 2.8 2.4 2.3 2.1 2.0Istanbul, Turkey 7,817 12,345 5.0 4.2 3.8 3.2 1.5

Teheran, Islamic Republicof Iran 6,830 10,211 5.5 3.1 1.6 1.7 2.3

Baghdad, Iraq 4,478 7,324 5.5 3.0 2.0 2.6 2.4Algiers, Algeria 3,702 6,276 4.2 4.2 4.2 3.4 2.0

Alexandria, Egypt 3,577 5,546 2.5 2.4 2.4 2.3 2.2Casablanca, Morocco 3,289 5,114 3.9 3.2 3.2 2.5 2.0

Tripoli, Libyan ArabJamhirya 3,272 6,044 11.1 11.1 5.4 3.6 2.6

Ankara, Turkey 2,826 4,095 4.6 2.8 2.3 2.3 1.5Riyadh, Saudi Arabia 2,576 5,117 12.0 7.1 6.3 4.1 2.8

Damascus, Syrian ArabRepublic 2,052 4,047 4.4 3.5 2.6 3.4 3.5

Esfahan, Islamic Republicof Iran 1,915 4,618 6.8 2.5 7.0 5.8 3.2


Page 49

Table 24. Housing investments, Turkey

YearHousing investment as percentage of

GNP total fixed capital investment1976 3.97 17.441978 4.70 21.671980 4.20 21.551982 2.42 12.821984 2.57 14.401986 3.72 16.101988 6.34 26.27

Source: State Planning Organisation, 1990 - quoted in Turel, 1991

Page 50

Table 25. Urban housing need and production, Turkey (1984-1989)

YearUrbanahousing need

(number ofdwelling units)

Urbanahousing productionNumber of

dwelling unitsb

Percentage ofhousing need

Percentage ofpublic sector

1984 272,000 122,580 45.1 4.41985 280,000 118,200 42.2 2.71986 290,000 168,600 58.1 3.61987 298,000 191,109 64.1 3.41988 305,000 205,483 67.3 2.81989 318,000 246,164 77.4 ..

Totals 1,763,000 1,052,000 59.7 3.4c

a: Municipalities with populations of more than 2,000.b: According to occupancy permits.c: 1985-1988 only.Source: Tokman, 1990.

Page 51

Table 26. The growth of squatter population and dwellings, Turkey (1950-1990)

Year

Number of squatterdwellings

Estimated squatterpopulation

Percentage ofurban population

living as squatters

Urban areas Ankara Urbanareas Ankara Urban

areas Ankara

1950 .. 12,000 .. 62,400 .. 21.81955 50,000 .. 250,000 .. 4.7 ..1960 240,000 70,000 1,200,000 364,000 16.4 56.01965 430,000 .. 2,150,000 .. 22.9 ..1970 600,000 144,000 3,000,000 748,000 23.6 60.61980 1,150,000 275,000 5,750,000 1,450,000 26.1 72.41990 1,750,000 350,000 8,750,000 1,750,000 33.9 58.3

Source: Based on Keles, 1990 - quoted in Aksoylu, 1994.

Page 52

Table 27. Urban population and level of urbanization, selected countries ofSouth Asia, including India (1975-2025)



urban areas1975 1995 2000 2025 1975 1995 2000 2025

India 132,272 250,681 291,901 629,757 21.3 26.8 28.6 45.2Pakistan 19,733 48,742 61,257 161,579 26.4 34.7 37.9 56.7

Bangladesh 7,108 22,034 28,603 78,430 9.3 18.3 21.3 40.0Nepal 649 2,996 4,148 13,959 5.0 13.7 16.7 34.3

Afghanistan 2,040 4,026 5,920 18,059 13.3 20.0 22.2 39.9Sri Lanka 2,998 4,108 4,722 10,660 22.0 22.4 24.2 42.6

Total (excl.India) 32,592 82,079 104,878 283,540 16.8 25.4 28.4 47.6

Total (incl.India) 164,864 332,760 396,779 913,297 20.2 26.4 28.5 46.0


Page 53

Table 28. Urban population growth, selected countries of South Asia,including India (1965-2025)

Country

Average annual population growthPer cent

Thousands

1965-1975

1975-1985

1985-1995

1995-2005

2005-2015

2015-2025

1995-2005

2005-2015

2015-2025

India 3.58 3.51 2.98 3.15 3.25 2.96 9,125 12,869 15,913Pakistan 3.90 4.47 4.78 4.64 4.27 3.32 2,800 3,984 4,499

Bangladesh 6.95 6.36 5.28 5.21 4.35 3.42 1,457 1,943 2,240Nepal 5.98 8.38 7.52 6.40 5.16 4.24 257 365 474

Afghanistan 6.09 1.87 5.07 6.54 4.68 4.18 356 440 607Sri Lanka 3.06 1.27 1.91 3.06 3.64 2.99 145 239 272

Total (excl. India) 4.58 4.61 4.85 4.89 4.33 3.43 5,029 6,992 8,125Total (incl. India) 3.77 3.74 3.41 3.61 3.56 3.10 14,154 19,862 24,039


Page 54

Table 29. Population growth, selected cities of South Asia (1965-2015)

City



1995 2015 1965-1975

1975-1985

1985-1995

1995-2005

2005-2015

Karachi, Pakistan 9,863 20,616 5.2 4.8 4.5 4.0 3.5Dacca, Bangladesh 7,832 18,964 7.8 8.6 5.9 5.2 3.9

Lahore, Pakistan 5,085 10,767 4.3 3.7 3.9 4.0 3.6Chittagong, Bangladesh 2,410 5,212 1.9 4.9 3.9 4.0 3.9

Kabul, Afghanistan 2,034 5,384 6.0 6.3 5.1 5.7 4.3Faisalabad, Pakistan 1,875 4,106 5.2 3.5 3.9 4.2 3.8


Page 55

Table 30. Urban poverty projections, Bangladesh (1990-2000)

YearTotal

urban population(millions)

Population below poverty linePer cent

Thousands

Poor Ultra Poor Poor UltraPoor

1990 22.9 50 30 11,450 6,8702000 37.3 45 25 16,760 9,000

Source: CUS, 1990.

Page 56

Table 31. Katchi abadis in Pakistan, by province (1988)

Province Number of katchiabadis Total land State land Private land Population

(millions)Punjab 902 9,376 8,875 501 1.6

Sind 1,300 26,000 24,300 1,700 3.8North West Frontier

Province 55 2,826 2,826 .. 0.3

Baluchistan 65 4,943 1,509 3,434 0.3Total 2,322 43,145 37,510 5,635 6.0

Source: Government of Pakistan, not dated.

Page 57

Table 32. Dhaka Metropolitan Areaa housing subsystems by location, incomegroup and land tenure.

Type ofhousing

sub-system

Locationwhere the

type ispredominant

Predominant income

groupb

Predominantstructure/ho

use type

Predominant type of

landtenure

Populationdensity

(persons/acre)

Share ofcity

population (percent)d

Share ofcity's

residential land

(percent)d

Squatters(includingpavement

dwellers andvagrants)

Inner,intermediate

and peripheralzones (along

the rail linebetween

Candaria andMahakhali,University

areas,Kamlapur, etc.)

EP

Mostrudimentaryshacks and

shanties

Illegal defacto

(mostly P)1500-8500 2.5 0.5

RefugeeRehabilitation

Colonies/squatter

resettlementcamps

(GovernmentAssistedHousing)

Intermediateand Fringe

Zones,Mohammadpur,

Mirpur,Bashabo,

Dattapara (Tongi), Chanpara

(Demra)

EP, PO,some LM

Kutchashacks,

thatchedhouses, semi-pucca single

storey

P, L, D 300-1500 6 2

Bustees:private rental

type (rentalhouses, row

houses, rentalmass units)

Extensivelylocated in inner,

intermediateand fringe

zones

EP, PO Kutchathatch,semi-pucca F, P, D 1000-2500 35

11

Bustees:private

owner-occupied houses

Extensivelylocated in inner,

intermediateand fringe

zones

PO, LMKutchathatch,

semi-pucca,pucca

F 500-2000 5

Conventionalurban

tenementslums, rental

andowner-occupie

d

Mostly innercity zone PO, LM

Semi-puccaandpucca

buildings, oldand

dilapidated, (1storey plus)

F 300-1500 15 4

Employeeshousing

(industrial,institutional,

privatehouseholds

Mostlysuburban andintermediate

zone

PO, LMKutcha, semi-pucca, pucca

, flatsP, F 300-5000 7 2

Otherlow-income

housing (freelodging, rural

commuter,etc.)

Diverselocations PO Varieties Various,

mainly F 100-300 1.5 0.5

Sub-total 70 20 Page 58

a: The study area, Dhaka Metropolitan Area, also includes population of Dattapara and Demra SquatterResettlement Camps. The total area covered under Dhaka Metropolitan Area in this study is 60 squaremiles with an estimated population of 4 million for early 1987. Total residential land is estimated at 30square miles.b: EP = Extreme-poor income group; PO = Poor income group; LM = Lower-middle income group.c: P = Public land; L = Leasehold under consideration; F = Freehold; D = Disputed land.d: The data in the last two columns are estimates.Source: Islam, 1992.

Page 59

Table 33. Housing programmes under the 1.5 Million Houses Programme, SriLanka (targets and performance)

Name ofSub-progra

mme

Targets

Programmeperformance duringits first three years

('000 units)

Notes(origi

naltarget

)

Status byJanuary 1996

a('000 units)

Agency

responsible

forreachi

ngtarget

Income

groups

Number ofunits('000)

1990 1991 1992 Built

Shortfall

fromtarget

NHDARural

Housingb

Ruralpoor 450 25 30 31

Assistance

through

grants,loans

andadvice

300 -150 NHDA

NHDAUrban

Housingb

Urbanpoor

middle

1505 5

..60

41

Asrural,

butmore

communitythan

individual

orientated.

Flats inColom

bo

502 -93 NHD

A

DisasterHousing

Alleffecte

d140 33 14 8

Specialassistance torelieveimpact

ofdisaste

rs(natura

l andman-m

ade)

100 0

NHDA/MRRSD/REPI

A

ProvincialHousing

Poor,middle 100 16 15 44

Landand

serviceprovisi

on,some

housing loans

100 0

NHDA andProvin

cialCounci

ls

MahaweliHousing


Settlement

associatedwith

irrigation

programme

20 -80 Mahaweli

PlantationsHousing


Nowpart of

theprivatis

ationof

plantations

30 -70

Plantations

Housing andSocial

Welfare Trust

c

EmployeeHousing

Allemploy

ees120 2 1 2

Individual

housing

through use

ofpensio

nfunds

10 -110 NHDA

IndividualHousingd

Allincome

s150 58 57 69

Effectively a

residual

group,it

includes all of

theinform

alsector

300 +150 NHDA

PrivateDevelopers

Middle,upper 25 0 0 0

Commercialunits

produced by

developers

1 -24 PrivateSector

Co-operativeHousing Poor 160 39 76 29

Loansthroug

hco-operative

societies,

banks

150 -10

Co-operative

s andbanks

Total 1,500 201 209 190 1,063 -437

Page 60

a: Estimate as of March 1993 by study team.b: These components of the Million Houses Programme reached 260,000 households in rural areas and40,000 households in urban areas.c: This programme target is likely to be achieved but over a slightly longer time frame.d: Technical assistance given to private sector informal self-build housing programme is also included.Source: Adapted from Fernando, 1994.

Page 61

Table 34. Utility services available inkatchi abadis, Lahore, PakistanType of services Per cent of households

Water supplyWater tap; inside house 80

Community water tap 8Hand-pump inside house 12

LatrinesSewerage system 25

Pit latrines 20Dry conservancy 55

DrainageSewerage system 24

Pucca drains 63Katcha or no drains 13

Domestic fuel

Piped gas 8Cylinder gas 4Kerosene oil 41

Wood or coal 42Cow-dung cakes, etc. 5

ElectricityConnection available 97

Connection not available 3

Garbage disposalRefuse depots accessible 32

Refuse depots inaccessible 17Refuse depots not available 51

Source: Katchi abadis survey, 1988 - cited in Zaidi, 1990.

Page 62

Table 35. Population growth, selected cities of India (1965-2015)

City


Average annual population growth (per cent)

1995 2015 1965-1975

1975-1985

1985-1995

1995-2005

2005-2015

Bombay 15,093 27,373 3.5 3.7 4.3 3.5 2.6Calcutta 11,673 17,621 2.5 2.3 1.7 1.8 2.4

Delhi 9,882 17,553 4.5 4.3 3.9 3.2 2.6Madras 5,906 9,451 4.9 2.7 2.3 2.2 2.5

Hyderabad 5,343 10,663 3.6 4.3 5.3 4.2 2.9Bangalore 4,749 8,324 4.3 4.8 3.4 3.0 2.7

Ahmedabad 3,688 6,124 3.8 3.3 2.6 2.5 2.7Pune (Poona) 2,940 5,407 4.2 4.0 4.0 3.4 2.8

Lucknow 2,029 4,057 2.2 3.4 5.0 4.0 3.0Based on United Nations, 1994.

Page 63

Table 36. Estimates of urban poverty, India (1970s and 1980s)

Source of estimate 1970-1971

1983

1987-1988

Urban Total Urban Total Urban TotalPlanning Commission

estimate Per cent .. .. 28.10 37.40 19.40 29.20

Direct all-India estimatePer cent 45.89 55.05 38.33 46.46 36.52 42.70Millions 50.07 301.76 65.96 333.27 74.96 336.42

Aggregation of Stateestimates

Per cent 46.17 56.25 39.74 48.11 37.76 45.85Millions 49.94 305.90 68.39 343.26 76.57 357.83

Note: Estimates are computed taking the per capita consumption expenditure of Rs. 56.64 as the povertyline at 1973-1974 prices for urban areas.Source: Minhas and others, 1991 - quoted in Kundu, 1993.

Page 64

Table 37. Estimating the housing shortage, India, millions (1961-1991)

Particulars1961

1971

1981a

1991

Urban Total Urban Total Urban Total Urban TotalPopulation 78.9 439.2 109.8 547.4 157.7 685.2 217.6 846.3

Number of Households 14.8 83.5 19.0 97.0 30.7 124.8 39.5 151.0Total housing stock 14.1 79.3 18.5 93.0 28.0 116.7 38.7 147.2

Pucca 6.5 15.0 11.8 26.0 18.1 36.9 28.2 61.3Semi-Pucca 4.9 29.0 4.3 31.9 6.8 40.1 6.9 45.6

Kutcha 2.8 35.3 2.4 35.1 3.1 39.7 3.7 40.4Usable housing stockb 11.4 68.8 16.1 81.7 24.9 102.7 .. ..

Housing shortage c 3.6 15.2 2.9 14.5 7.0 23.3 4.8 18.5a: The figures for population, households and housing stock in 1981 include the estimated values for thosestates where the population census could not be conducted. The number of households in urban areas isobtained after adjusting for congestion, the number of actual households being 29.3 million.b: Usable housing stock =pucca + semi-pucca + serviceable Katcha.c: Housing shortage = Number of households - usable housing stock.Source: NBO, 1990; Government of India (1992a).

Page 65

Table 38. Select indicators on the housing situation, India (1961-1991)

Particulars1961

1971

1981

1991

Urban Total Urban Total Urba

n Total Urban Total

Population/housing stock 5.64 5.55 5.88 5.89 5.70 5.87 4.18 4.34Population/usable housing stock 7.04 6.43 6.76 6.64 6.74 6.75 .. ..

Persons per room 2.62 2.62 2.78 2.77 2.53 2.71 .. ..Households per housing unit 1.06 1.05 1.06 1.07 1.06 1.07 1.32 1.29

Size of households 5.33 5.26 5.73 5.64 5.20 5.55 5.51 5.60Households in one-room units

(per cent) 53.05 49.00 50.10 47.82 45.80 44.72 39.55 40.49

Vacant houses (per cent) 7.23 5.80 7.47 6.31 6.41 5.33 8.53 6.36Houseless population (per cent) 0.37 0.29 0.43 0.36 0.39a 0.34a 0.08 0.06

a: These figures exclude Assam.Source: UNCHS, 1993c; Government of India (1992a).

Page 66

Table 39. Type of housing structures, by expenditure class, India (1983)Monthly per capita

expenditure class (Rs.)Types of housing structure

Average floor area per capita (m²)Kutcha Semi-Pucca Pucca

0-30 20.1 24.2 54.1 3.330-40 46.6 34.6 18.5 4.340-50 41.7 35.3 22.8 3.950-60 38.4 33.7 27.7 4.560-70 33.6 37.6 28.2 4.670-85 28.7 35.7 35.1 5.0

85-100 25.5 32.1 41.7 5.5100-125 20.6 31.8 47.1 6.7

0-125 average a 26.5 33.6 39.7 5.7All expenditure classes 16.4 25.7 57.2 7.8

a: The expenditure classes with a monthly expenditure below Rs. 125 per month comprise 40 per cent ofthe total urban population.Source: Kundu, 1993 (based on NSSO, 1987).

Page 67

Table 40. Prevalence and cost of rental housing, by expenditure class, IndiaMonthly per

capitaexpenditureclass (Rs.)

Average per capitamonthly rent (Rs.)

Households livingin rented houses (per

cent)

Monthly expenditure spenton actual rent (per cent)

Actual Imputed0-30 3.9 8.1 10.9 13.0

30-40 3.5 6.8 14.8 9.940-50 3.7 6.4 19.0 8.250-60 4.3 7.8 15.9 7.960-70 4.8 8.7 19.8 7.470-85 6.2 10.0 23.6 8.0

85-100 6.9 12.1 27.5 7.5100-125 8.8 16.4 30.8 7.8

0-125 average a 7.0 12.5 26.1 ..All classes 17.3 24.0 37.6 ..

a: The expenditure classes with a monthly expenditure below Rs. 125 per month comprise 40 per cent ofthe total urban population.Source: Kundu, 1993 (based on NSSO, 1987).

Page 68

Table 41. Urban population and level of urbanization, selected countries of East siaand the Pacific, including China (1975-2025)



urban areas1975 1995 2000 2025 1975 1995 2000 2025

China 160,047 369,492 443,057 831,880 17.3 30.3 34.5 54.5Indonesia 26,259 69,992 85,819 167,393 19.4 35.4 40.3 60.7Viet Nam 9,021 15,479 18,399 46,135 18.8 20.8 22.3 39.1

Philippines 15,294 36,614 44,005 77,622 35.6 54.2 59.0 74.3Thailand 6,244 11,787 13,555 28,756 15.1 20.1 21.9 39.1

Myanmar 7,282 12,188 14,640 35,759 23.9 26.2 28.4 47.3Republic of

Korea 16,947 36,572 40,651 50,987 48.0 81.3 86.2 93.7

D.P.R of Korea 9,356 14,650 16,392 25,094 56.5 61.3 63.1 75.2Malaysia 4,616 10,814 12,820 22,942 37.7 53.7 57.5 72.7

Cambodia 731 2,123 2,809 8,567 10.3 20.7 24.1 43.5South-East

Asia 72,214 163,131 196,671 395,326 22.3 33.7 37.3 55.4

East Asia 31,179 58,670 64,908 85,327 53.8 75.6 79.0 87.0Pacific Islands 895 1,668 1,977 4,847 20.1 24.2 25.8 40.5

Total (excl.China) 104,288 223,469 263,556 485,500 27.0 39.3 42.7 59.0

Total (incl.China) 264,335 592,961 706,613 1,317,38

0 20.1 33.1 37.2 56.1


Page 69

Table 42. Urban population growth, selectedcountries of East Asia and the Pacific, includingChina (1965-2025)

Country

Average annual urban population growthPer cent Thousands

1965-1975

1975-1985

1985-1995

1995-2005

2005-2015

2015-2025

1995-2005

2005-2015

2015-2025

China

1.89

4.19

4.36

3.45

2.69

2.09

14,912

15,783

15,544

Indonesia 4.50 5.24 4.81 3.90 2.83 2.13 3,258

3,299

3,183

Viet Nam 3.66 2.65 2.82 3.66 4.01 3.45 669 1,068

1,328

Philippines 4.21 4.40 4.52 3.47 2.42 1.73 1,486

1,390

1,224

Thailand 4.71 3.88 2.58 2.93 3.23 2.89 395 589 714Myanmar 3.69 2.16 3.06 3.86 3.94 3.16 561 840 957

Republic ofKorea 6.26 4.56 3.28 1.84 0.94 0.56 734 429 279

D.P.R. ofKorea 5.28 2.26 2.28 2.12 1.75 1.56 341 343 360

Malaysia 4.97 4.54 4.16 3.23 2.42 1.97 405 401 407Cambodia 0.95 4.35 6.61 5.51 4.77 4.01 151 215 278

South-EastAsia 4.16 4.18 4.13 3.65 2.97 2.37 7,02

97,93

78,25

3

East Asia 5.26 3.64 2.79 1.81 1.13 0.84 1,151 834 681

PacificIslands 5.91 3.26 3.06 3.56 3.82 3.48 70 108 141

Total (excl.China) 4.49 4.02 3.75 3.19 2.58 2.09 8,25

08,87

89,07

5Total (incl.

China) 2.83 4.12 4.12 3.35 2.65 2.09 23,162

24,661

24,619


Page 70

Table 43. Population growth, selected cities of East Asia and the Pacific(1965-2015)

City



1995 2015 1965-1975

1975-1985

1985-1995

1995-2005

2005-2015

Seoul, Republic ofKorea 11,641 13,139 7.0 3.5 2.0 0.9 0.3

Jakarta, Indonesia 11,500 21,170 3.9 4.5 4.5 3.8 2.4Metro Manila,

Philippines 9,280 14,711 5.9 3.3 3.0 2.9 1.8

Bangkok, Thailand 6,566 10,557 4.0 3.2 2.2 2.3 2.5Hong Kong 5,574 5,849 2.1 2.5 1.0 0.4 0.1

Pusan, Republic ofKorea 4,082 4,584 5.9 3.8 1.6 0.7 0.5

Yangon, Myanmar 3,851 7,407 4.3 4.7 3.3 3.3 3.4Ho Chi Minh, Viet Nam 3,555 6,439 3.8 2.4 1.8 2.6 3.4

Bandung, Indonesia 2,977 5,292 3.2 3.5 3.5 3.3 2.5Surabaja, Indonesia 2,742 4,762 2.9 3.2 3.2 3.1 2.5

Medan, Indonesia 2,222 4,094 5.5 3.9 3.9 3.6 2.6Source: Based on United Nations, 1994.

Page 71

Table 44. Official urban poverty lines, Indonesia (1976-1990)

YearPer capita poverty line

Population living below thepoverty line

Urbanpopulation

aspercentage

oftotal

populationRp. $ Millions Per cent

1976 4,522 11 10 39 191978 4,969 12 8 31 201980 6,831 12 10 29 221981 9,777 15 9 28 231984 13,731 13 9 23 271987 17,381 11 10 20 321990 20,614 11 9 17 31

Source: CBS, 1989; 1992; Swasembada magazine, 1988.

Page 72

Table 45. Urban housing shortage, Indonesia Number

Total urban housing stock 10,826,000Total number of households 11,690,000

Estimated shortage of dwellings 864,000Source: CBS, 1990; Suhandjaja, 1991.

Page 73

Table 46. Quality of urban housing stock, Indonesia (1961-1983)

Quality of dwelling1961

1983

Number ofunits per cent Number of

units per cent

Permanent dwellings 431,000 20.0 2,419,000 37.5Semi-permanent dwellings 539,000 25.0 2,096,000 32.5

Temporary dwellings 1,185,000 55.0 1,935,000 30.0All dwellings 2,155,000 100.0 6,450,000 100.0

Source: Suhandjaja, 1991.

Page 74

Table 47. Population growth, selected cities of China (1965-2015)

City


Average annual population growth (per cent)

1995 2015 1965-1975

1975-1985

1985-1995

1995-2005

2005-2015

Shanghai 15,082 23,382 0.5 0.8 2.0 2.6 1.9Beijing 12,362 19,423 1.1 1.4 2.4 2.7 1.9Tianjin 10,687 16,998 3.4 2.8 2.8 2.8 1.9

Shenyang 5,310 8,588 1.1 1.3 2.3 2.8 2.1Wuhan 4,399 7,182 1.5 1.6 2.5 2.9 2.1

Guangzhou 4,056 6,591 0.2 0.6 2.1 2.8 2.1Chongqing 3,525 5,788 1.1 1.3 2.4 2.9 2.1

Taipei 3,417 5,700 4.1 3.1 3.2 3.0 2.1Chengdu 3,401 5,623 2.5 2.3 2.7 2.9 2.2

Harbin 3,303 5,425 1.5 1.4 2.3 2.9 2.2Xian 3,283 5,472 1.8 2.2 3.1 3.0 2.2

Dalian 3,132 5,402 0.8 3.2 5.0 3.4 2.2Jinan 3,019 5,250 1.1 3.7 5.4 3.4 2.2

Nanjing 2,965 4,919 1.4 1.7 2.6 3.0 2.2Changchun 2,523 4,228 1.7 2.0 2.9 3.0 2.2

Taiyuan 2,502 4,189 2.3 2.2 2.8 3.0 2.2Source: Based on United Nations, 1994.

Page 75

Table 48. Urban household income distribution (per cent of all households), China(1982-1988)

Monthly income(yuan) 1982 1983 1984 1985 1986 1987 1988

Below 20 0.92 0.611.67

11.05 5.67 4.248.31

20-25 3.68 2.9725-35 25.63 20.32 10.5235-50 45.40 46.56 38.89 24.78 14.81 11.7050-60 14.20 16.42 22.67 19.53 16.17 13.36 7.6160-70

10.17 13.12 26.25

16.04 17.86 15.74 10.2670-80 10.96 14.82 14.60 12.5380-90 7.01 10.24 12.09 12.46

90-100 4.11 7.20 8.49 11.91100-110 2.63 4.60 6.08 9.21110-120

3.89

3.05 4.35 7.25120-130 1.83 3.03 5.32130-140 1.24 2.04 3.82140-150 0.69 1.11 2.95

Above 150 1.62 3.17 8.36All income groups 100.00 100.00 100.00 100.00 100.00 100.00 100.00

Note: Before 1985, the data are from a survey of families of staff and workers in cities. Since 1985, thedata include retired people, self-employed labourers, personnel other than workers or labourers, andresidents in county towns.Source: Lin Zhiqun, 1991b (Updated by the Beijing Housing Reform Office).

Page 76

Table 49. Incomes and expenditures per capita, China (1982-1992)

YearaAverage annual income

per family member (yuan)Average annual living expenditure b

per family member (yuan)1982 535 4711983 573 5061984 660 5591985 749 6731986 909 7991987 1,012 8841988 1,192 1,1041989 1,388 1,2111990 1,523 1,2791991 1,713 1,4531992 2,032 1,672

Note: Before 1985, the data are from a survey of families of staff and workers in cities. Since 1985, thedata include retired people, self-employed labourers, personnel other than workers or labourers, andresidents in county towns.b: Living expenditure income refers to the total income of a family that can be used to sustain the daily lifeof that family.Source: Lin Zhiqun, 1991b (updated by the Beijing Housing Reform Office).

Page 77

Table 50. Incidence of urban poverty, China (1985-1987)

Poverty lines

Size of urban population below poverty line (millions)1985

1987

1988

Unadjusted Adjusteda

Unadjusted

Adjusteda

Unadjusted

Adjusteda

U1 (50% of meanincome)b

19.52 25.79 15.17 17.91 17.95 21.07

U2 (Y375 adjusted)c 22.31 28.20 11.98 14.11 16.84 19.80U3 (Y300 adjusted)d 17.07 22.57 7.96 9.43 13.49 15.85

a: Unlike the Chinese official estimates, household distributions are adjusted for household size.b: U1 = 50 per cent of mean income (i.e. Y349 in 1985, Y458 in 1987 and Y560 in 1988).c: U2 = Y375 (1985 value, i.e. Y436 in 1987 and Y526 in 1988).d: U3 = Y300 (1985 value, i.e. Y349 in 1987 and Y421 in 1988).Source: Ahmad and Wang, 1991.

Page 78

Table 51. Urban dwelling conditions, per household and capita, China (1982-1988) 1982 1983 1984 1985 1986 1987 1988

Usable floor area m²/household .. 32.0 33.0 39.1 41.8 43.3 43.5Living floor area m²/household 23.3 24.1 25.5 29.2 30.9 31.9 31.9

Service floor area m²/household .. 7.9 7.5 9.9 10.9 11.3 11.6Number of rooms per household .. 1.9 2.1 2.2 2.4 2.4 2.4

Usable floor area m²/capita .. 7.9 8.2 10.0 10.9 11.5 12.0Living floor area m²/capita 5.6 5.9 6.3 7.5 8.0 8.5 8.8

Service floor area m²/capita .. 2.0 1.9 2.5 2.8 3.0 3.2Source: Lin Zhiqun, 1991b.

Page 79

Table 52. Urban household dwelling conditions (per cent), China (1982-1988) 1982 1983 1984 1985 1986 1987 1988

Unalloted householdsa 2.53 1.81 0.97 1.50 0.69 0.48 0.38Over-crowded householdsb 21.76 19.93 16.07 12.54 10.20 7.92 6.71

Households with inconvenientspace distributionc

9.27 10.00 9.59 8.71 7.60 7.55 7.77

Households with floor space of:4-6 m² 29.20 27.18 25.55 19.44 21.21 19.07 15.906-8 m² 20.46 21.80 23.73 22.63 21.67 22.22 21.14

over 8 m² 16.78 19.28 24.09 35.18 38.63 42.76 48.12Total 100.00 100.00 100.00 100.00 100.00 100.00 100.02

a: Unalloted households: households for whom no housing has been allocated because none is available; forexample, newly married couples may have to live in their parents' units that are already overcrowded.b: Over-crowded households: households which live in dwellings with a floor area below the averageminimum standard; (i.e. per capita living floor area of less than 4 m²).c: Households with inconvenient space distribution: households living in a dwelling where separatebedrooms are not available for male and female children over 13 years or for married couples.Source: Lin Zhiqun, 1991b.

Page 80

Table 53. Basic conditions of urban public utilities, China (1965-1992)Item 1965 1978 1980 1985 1990 1992

Running water supply

Total quantity of running water suppliedper year (billions of ton) 2.63 7.88 8.83 12.80 38.23 42.98

Domestic consumption (billions of ton) 1.03 2.76 3.39 5.19 10.01 11.73 Domestic water supply per capita (tons) 19.7 44.0 46.8 55.1 67.9 67.9

Percentage of population with access totap water (per cent) 74.0 81.0 81.4 81.0 89.2 92.5

Public transport

Total number (in thousands) of publicvehicles (buses and trolley buses) 11 26 32 45 62 77

Total number of public vehicles (busesand trolley buses) per thousand people 0.16 0.33 0.35 0.39 0.48 0.59

Length of paved road (thousands of km) 24 27 29 38 95 97

Surface area of paved road (millions ofm²) 210 225 253 359 892 952

Coal gas and liquified gas for public use

Total quantity of artificial coal gassupplied per year (billions of m³) 0.7 1.7 2.0 2.5 17.5 15.0

Domestic consumption (millions of m³) 320 666 833 1,071 2,741 3,053

Length of gas pipe lines (thousands ofkm) 2.4 4.7 5.6 10.6 16.3 20.9

Total quantity of natural gas supplied peryear (millions of m³) .. 691 589 1,621 6,423 6,289

Domestic consumption of liquified gas(thousands of tons) 0.1 176 270 547 1,428 2,020

Population with access to natural gas(per cent) 3.0 13.9 16.8 22.4 42.2 52.4

Afforestation of cities

Area of green space (thousands ofhectares) 26 82 86 159 475 534

Area of green space per thousandpeople (hectares) 0.43 1.06 0.96 1.37 3.22 3.45

Area of parks and zoos (thousands ofhectares) 14 15 16 22 40 46

Health and sanitation Garbage removed (millions of tons) .. .. 31 45 68 83 Faeces removed (millions of tons) .. .. 16 17 24 30 Length of sewer (thousands of km) 13 20 22 32 58 68

Note: Figures for 1986 and later are based on the total population, while figures before 1986 are based onthe population under the administration of City Construction Departments. Per capita figures are based onthe non-agricultural population of the total population in cities.Source: Lin Zhiqun, 1991b.

Page 81

Table 54. Housing units constructed under the EHP, Republic of Korea (1990/1991)

Total numberof units

Housing forsale

Housing forrent

units percent units per

centLocal Government 33,969 25,971 76.5 7,998 23.5

KNHC 36,641 24,409 66.6 12,232 33.4Private builders 26,851 15,721 58.5 11,130 41.5

Total 97,461 63,101 64.7 31,360 35.3Source: Jang, 1994.

Page 82


List of acronymsAsDB Asian Development BankCBO Community-based organizationCBS Central Bureau of Stratistics, IndonesiaCONAMUP Coordinación Nacional de Movimiento Urbano Popular, "the

national coordinating body of popular movements", MexicoCSO Central Statistical Organisation, Government of IndiaCUS Centre for Urban Studies, Dhaka, BangladeshDANIDA Danish International Development AgencyEDI Economic Development Institute, The World BankEHP Employee's Housing Programme, Republic of KoreaEIUS Environmental Improvement of Urban Slums, IndiaFEDEVIVIENDA Federación Nacional de Organizaciones de Vivienda Popular,

"the national federation of self-help community organizations",Colombia.

FUNACOM "The municipal programme to support housing for low-incomepersons through self-management", São Paulo, Brazil

FUNAPS "The municipal fund to support housing for low-incomepeople", São Paulo, Brazil

GDP Gross domestic productGNP Gross national productGSS Global Strategy for Shelter to the Year 2000Habitat II Second United Nations Conference on Human SettlementsHBE Home-based enterpriseIDA International Development Association, The World BankILO International Labour OrganizationIMF International Monetary FundKIIE Korean Institute of Industrial Economics, Republic of KoreaKNHC Korean National Housing Corporation, Republic of KoreaKRIHS Korean Research Institute for Human Settlements, Republic of

KoreaKRISS Korean Research Institute for Social Sciences, Republic of

KoreaNBO National Building Organisation, IndiaNCHSE National Centre for Human Settlements and Employment, New

Delhi, IndiaNCU National Commission on Urbanisation, IndiaNGO Non-governmental organizationNIUA National Institute for Urban Affairs, New Delhi, IndiaNSSO National Sample Survey Organisation, IndiaODA Overseas Development Administration, United Kingdom

Page 83

SAP Structural Adjustment ProgrammeSEWA Self-Employed Women's Association, Ahmedabad, IndiaSIP Slum Improvement ProjectSPARC Society for the Promotion of Area Resource Centres,

Bombay, IndiaSSE Small-scale enterpriseSUP Slum Upgrading ProgrammeUNCED United Nations Conference on Environment and DevelopmentUNCHS (Habitat) United Nations Centre for Human Settlements (Habitat)UNDP United Nations Development ProgrammeUNECLAC United Nations Economic Commission for Latin America and

the CaribbeanUNESCAP United Nations Economic and Social Commission for Asia

and the PacificUNICEF United Nations Children's FundUNV United Nations VolunteersUSAID United States Agency for International DevelopmentWHO World Health Organization

Page 84

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Notes

1. Lindenberg, 1991; Little and others, 1993; Sen, 1994; World Bank, 1993a.

2. The World Bank projection from 1988 that these 425 million would amount tomore than half of the world's poor population was based on the assumptionthat rural poverty could be considerably reduced during the same period. Laterprojections by the World Bank indicate that rather than declining from about 1billion in absolute poverty in 1985 to some 825 million in 2000 (World Bank,1990), the total figure is expected to grow to 1.1 billion (World Bank, 1992).

3. It should be kept in mind that access in terms of time may not be the same aseasy access. Since population densities are higher in urban than in rural areas,this type of an indicator tends to overestimate the provision of servicesavailable in urban areas.

4. Balicasan, 1994 (the Philippines); Firdausy, 1994 (Indonesia); Gunatilleke andPerera, 1994 (Sri Lanka); Khundker and others, 1994 (Bangladesh); Kim, J-G.,1994 (Republic of Korea); Mathur, 1994 (India); Ratanakomut and others, 1994(Thailand).

5. See for instance Berg and others, 1994; Kakwani and others, 1993; Stewart,1995.

6. See UNCHS, 1987; 1988; 1989c; World Bank, 1991; 1993b; UNDP, 1991.

7. Little and others, 1970; Lipton, 1977; and others.

8. Harris and Todaro, 1970; Todaro, 1976; Todaro, 1992.

9. Fei and Ranis, 1964; 1975; Ohkawa and others, 1985; Schiff and Valdés, 1992.

10. The shortcomings of the project approach is discussed in more depth inUNCHS, 1991b.

11. See for instance Alonso, 1995; Harris, 1994; Henderson, 1995; Krugman, 1995;Porter, 1995.

12. See UNCHS, 1989c; 1992b; UNCHS/ILO, 1995.

13. World Bank, 1991; 1993b; UNCHS, 1987; 1988; 1989a.

14. For an extended elaboration of the argument see Stretton, 1976; Pugh, 1990.

15. See Amin and Thrift, 1994; Pugh, 1995; Sassen 1994.

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16. Personal communication from Dr. C.L. Odimuko to UNCHS (Habitat),February 1995.

17. See for instance Boakye, 1994; Kitunka, 1993; Korboe, 1994.

18. The urban population estimate by this source is considerably higher than thatpresented in tables 27 and 28. It is estimated by the Centre for Urban Studies (CUS, 1990) to be 22.9 million (21 per cent) in 1990 and 37.3 million (29 percent) in 2000, compared to the United Nations (1994) estimates of 16.9 million(16 per cent) and 28.6 million (21 per cent).

19. According to Government of India guidelines in connection with theEnvironmental Improvement of Urban Slums (EIUS) programmes, the norm isone tap per 150 people.

20. Pornchokchai, 1985; Krongkaew and others, 1986 -- both quoted in Hutuseraniand Tapwang, 1990.

21. These case studies draws heavily on Rakodi and Withers (1994), Zimbabwe;Denaldi (1994) and Guedes and Devecchi (1994), São Paulo; Jang (1994), theRepublic of Korea; and Sundaram (1994), India.

22. In Africa: Korboe, 1994; Syagga, 1992; Ziss and Schiller, 1982; and in LatinAmerica: Strassmann, 1970.

23. See Gilbert, 1988; Nientied and others, 1987; Strassmann, 1987; UNCHS/ILO,1995.

24. See Beneria, 1992; Molapo, 1994; Moser and Peake, 1987; NIUA, 1989.

25. See Boonyabancha, 1990; Useche de Brill, 1990; Sundaram, 1990a.

26. See Leynes, 1992; Tokman, 1992.

27. These are chonsei, wolsei and sakwolsei (although the latter only accounts forabout 5 per cent of tenancies). Chonseiis the arrangement whereby the tenantpays a deposit to the landlord on commencement of the tenancy, but no rentalpayments; so that rent is equivalent to the opportunity costs of the deposit, plusdevaluation over the tenancy period, after which the deposit is returned. Wolseidescribes a more familiar situation where rental payments are paid regularly overthe tenancy period together with a deposit. Sakwolsei is the circumstance wherethe deposit is equal to the sum of monthly payments over the period of thetenancy - a hybrid of the other two forms. Chonsei accounts for almost 60 percent of private tenancies in South Korea and wolsei for about 37 per cent. In1990, 55 per cent of households in urban areas in Korea were tenants (KimW-J., 1994).

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Comments on country groupings

The regional groups referred to in this publication are a combination of thoseused in the 1995 Human Development Report (UNDP, 1995) and those used in the1995 Word Development Report (World Bank, 1995). In principle, it follows theHuman Development Report in classifying countries as either industrialized ordeveloping, and the World Development Report in delineating regions.

The regions used in this publication are:

Industrialized countries: All countries of Europe, including the countries ofthe former U.S.S.R.; North America; as well as Japan, Australia and NewZealand. It does not, however, include Israel as is the case in the HumanDevelopment Report.

Latin America and the Caribbean: All countries of South and CentralAmerica, including Mexico; as well as the island nations of the Caribbean.

Sub-Saharan Africa: All countries on the African continent apart from theNorth African countries of Algeria, Egypt, Libyan Arab Jamahirya, Morocco,Tunisia and Western Sahara.

North Africa and the Middle East: The North African countries of Algeria,Egypt, Libyan Arab Jamahirya, Morocco, Tunisia and Western Sahara; aswell as all coutries in Asia west of, and including, the Islamic Republic of Iran(this includes Turkey and Cyprus which are classified as part of Europe in theWorld Development Report).

South Asia: The countries of Afghanistan, Bangladesh, Bhutan, Maldives,Nepal, Pakistan and Sri Lanka. Due to the size of its population, India isconsidered a separate region. If a table or text includes India in the region ofSouth Asia this is stated explicitly.

India.

East Asia and the Pacific: All countries in Asia east of, and including,Myanmar, i.e. all countries of East Asia "proper" (Democratic People'sRepublic of Korea, Hong Kong, Macao, Mongolia and the Republic ofKorea, but excluding China and Japan), South East Asia, and the Pacific(excluding Australia and New Zealand). Due to the size of its population,China is considered a separate region. If a table or text includes China in theregion of East Asia and the Pacific, or in the East Asian subregion, this isstated explicitly.

China.

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Data notes

"Billion" is 1,000 million.

"Tons" are metric tons, equal to 1,000 kilogrammes.

"Dollars" or "$" are US dollars unless otherwise stated.

The symbol "/" in dates, such as "1994/1995" means that the period of timemay be less than two years but straddles two calendar years and refer to a surveyyear or fiscal year.

The symbol ".." means not available.

The number "0" or "0.0" in tables and figures means zero or a quantity lessthan half the unit shown.

The countries listed in the regional tables of chapter IV — "Urban populationand level of urbanization" and "Urban population growth" — are selected on thebasis that they had a total population of more than seven million in 1995. Thecountries are listed in descending order according to total population in 1995.

The cities listed in the regional tables of chapter IV — "Population growth ofselected cities" — are those that are projected to have a population of more thanfour million in 2015, provided that they are listed in United Nations (1994), i.e. thatthey had a population of at least 750,000 in 1990. The cities are listed in descendingorder according to population in 1995.

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ABOUTThe Human Settlements Conditions

of the World's Urban PoorHS/391/96 E

ISBNE 92-1-131487-9 (electronic version)

Text source: UNCHS (Habitat) printed publication: ISBN 92-1-131300-7 (publishedin 1996).

This electronic publication was designed/created by Inge Jensen.This version was compiled on 2 January 2006.

Copyright© 2001 UNCHS (Habitat); 2002-2006 UN-HABITAT.All rights reserved.

This document has been reproduced without formal editing.The designations employed and the presentation of the material in this publication donot imply the expression of any opinion whatsoever on the part of the UnitedNations Secretariat concerning the legal status of any country, territory, city or areaor of its authorities, or concerning the delimitation of its frontiers or boundaries.Reference to names of firms and commercial products and processes does notimply their endorsement by the United Nations, and a failure to mention a particularfirm, commercial product or process is not a sign of disapproval.Excerpts from the text may be reproduced without authorisation, on condition thatthe source is indicated.

UN-HABITAT publications can be obtained from UN-HABITAT's RegionalOffices or directly from:

UN-HABITAT,Information Services Section,

G.P.O. Box 30030,Nairobi 00100, KENYA

Fax: (254) 20-7623477 or (7624266/7)E-mail: [email protected]

Web-site: http://www.unhabitat.org/

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mailto:[email protected]

http://www.unhabitat.org/

http://www.unhabitat.org/


Preface

More than one billion people are currently living in absolute poverty, withincomes too low to meet their daily requirements in terms of food, clothing and otherbasic needs. A similar, or even larger number of people do not have access to safeand healthy shelter. The latter half of the twentieth century has seen the continuoustransfer of the world's population into urban areas. In 1950, less than 30 per cent ofthe world's population was urban. By 1995 this figure has increased to 45 per cent.Within the next ten years, more than every second human being will live in cities andtowns.

We are, however, not only living in an urbanizing world. We are also living in aperiod which can best be described as the age of the 'urbanization of poverty'. By1985 some 330 million urban dwellers in developing countries had incomes so lowthat they were characterized as living in absolute poverty. Ten years later, in 1995,the figure is estimated at 430 million. At the same time, more than 600 million urbanresidents in developing countries live in health-threatening houses and conditionscharacterized by lack of basic services such as piped water, sanitation and healthcare.

There is a considerable regional variation to this general picture. While threequarters of the poor in Latin America and the Caribbean, and in North Africa and theMiddle East, live in urban areas, a similar proportion of the poor live in rural areas insub-Saharan Africa. The trend, however, is general. Rapid urban growth in allregions is accompanied by a relative (and in most cases also an absolute) increase inthe number of urban poor. The explosive growth of informal settlements in manysub-Saharan cities is a visible manifestation of this.

There are many reasons for the increasing 'income poverty' and 'housingpoverty' in urban areas. One of these is the process of urbanization itself. When thisoccurs at a time of world-wide economic recession — and as we are increasinglyrealizing that present policies for human settlements development fail to cater for thespecial circumstances of the groups affected by extreme poverty — it is notsurprising that a large proportion of the 65 million people that are added to the urbanpopulations of developing countries each year end up unemployed orunderemployed, living in very poor shelter conditions.

It is against this reality that the Fourteenth Session of the United NationsCommission on Human Settlements requested the United Nations Centre for HumanSettlements (Habitat) to report to the second United Nations Conference on HumanSettlements (Habitat II) on the human settlements conditions of the world's urbanpoor. This publication has been prepared in response to that request to presentrecommendations on how to address the shelter problem of the poorest groupswithin the context of enabling shelter strategies.

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The dual problems of urban poverty and inadequate human settlementsconditions in developing countries constitute two of the most fundamental challengesto politicians and policy-makers throughout the world. The growth of the informalsector is a symptom of the inability of the formal sector to absorb the labourpotential of an increasing number of urban dwellers. Yet, the informal sector is alsothe most important arena for shelter provision, and in many cases the only arenaopen to the urban poor.

The Global Strategy for Shelter to the Year 2000 (GSS) was adopted by theGeneral Assembly of the United Nations in December 1988 to address these issues.It calls for the introduction of enabling shelter strategies: for facilitating the actionsand potential of all participants in the shelter delivery process. This implies a changefrom policies of government intervention to policies of enablement. Yet, as isacknowledged in the GSS, this process of liberalization embodies certain dangers tothe urban poor. Increased demand for land and housing is accompanied byincreased 'commercialization' of these markets. As choice is a positive function ofincome, many among the poor may end up with no choice at all. Thus, althoughliberalization is a necessary condition for the success of the GSS, it is by no means asufficient one.

This is not an argument for abandoning the enabling approach. Yet, if we are toimprove the human settlements conditions of the poorest groups it means goingbeyond enabling shelter strategies. Enabling shelter strategies does not imply that thepublic sector should withdraw from shelter provision completely. In fact, it is onlyby enabling the "not-so-poor" to help themselves, that governments can makeresources available for direct assistance to the poorest groups.

These circumstances serve to highlight the strategic significance of theHabitat II Conference — the 'City Summit' — in seeking genuine, worldwidesupport for a global strategy which seeks to improve shelter conditions and thequality of life in urban areas, whilst at the same time combatting the problems ofurban poverty effectively.

The challenge ahead, for Habitat II and the world community at large, is trulystaggering. Yet, as human beings, we cannot afford to fail.

We gratefully acknowledge the contribution of Mr. Richard Groves, of theUniversity of Birmingham, in preparing the background report on which thispublication is largely based; and of Mr. Inge Jensen, of UNCHS (Habitat), indeveloping the research design, co-ordinating the activities and preparing the finalpublication.

Dr. Wally N'DowAssistant-Secretary-General,

United Nations Centre for Human Settlements (Habitat)and

Secretary-General,United Nations Conference on Human Settlements (Habitat II)

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Executive summaryI. Introduction

1. The latter half of the twentieth century has seen the continuoustransformation of the world's population into urban dwellers. In less than ten yearsurban dwellers will form the majority. Urban population growth in the developingworld has increased at three times the rate of the industrial countries and has led to asituation where the growth rate of cities has outpaced the capacity of urbaneconomies to generate employment. Hence, there is often large scale unemploymentand underemployment in the informal sector in the cities of developing countries andurban poverty is a rapidly increasing phenomenon.

2. The growth rate of cities and towns means that twice as many people willbecome city dwellers over the next generation than in the last. This is a dauntingprospect and it means that urban poverty and the human settlement conditions of theworld's urban poor are two of the most fundamental challenges to politicians andpolicy-makers throughout the world.

3. The growth rate in the number of households is even higher than that ofpopulation growth, due to decreasing household sizes. In China, the growth rate inthe number of households is more than 2.5 times as high as that of populationgrowth. It is only in sub-Saharan Africa that the rate of population growth is higherthan the rate of household growth, i.e. the average household size in sub-SaharanAfrica is actually increasing. These trends have significant impacts on both thequantity and quality of housing demand.

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Executive summaryII. The concept and scale of urban poverty

4. Poverty is a complex notion. It may be regarded from both a long andshort-term perspective. Much poverty may be seen as a structural problem ofevolving demographic and economic systems. But, macro-economic fluctuationsand exposure to the global economy also means increased short-term volatility witheffects on urban labour markets. Nonetheless, evidence now exists that policies domake a difference and variable regional economic performances have meantimprovements in some parts of the world alongside increasing problems in others.

5. It is important to distinguish between concepts of income (or subsistence)poverty and housing and urban poverty. Much progress has been achieved inmeasuring and interpreting income poverty, but recent authors have suggested thatthe concept of poverty is more complex than income measures suggest. Intrinsically,it is a part of social, economic and political processes.

6. The addition of the notion of well-being assists in our understanding of thequality of life to aspects of poverty and at the same time differential abilities,depending on 'entitlements' and 'endowments', can increase or diminish one'svulnerability to poverty. Housing and urban poverty are not merely extrapolations ofincome poverty, they are influenced by factors other than issues related toaffordability, such as the health, safety and security of residents or macro-economicconsiderations such as interest rate changes or inflationary conditions.

7. While the incidence of poverty is falling in most regions (with the exceptionof sub-Saharan Africa), the numbers of those living in poverty are increasing and arelikely to be higher (at 1.1 billion) by the year 2000 than they were in 1985. Thecurrent number of the urban poor is estimated at 430 million.

8. The poor are comprised of: large families with high dependency ratios;those who are underemployed; a disproportionate number of women; those lackingbasic education and who are illiterate; and those with low status and lacking socialsupport (e.g. street children and other destitutes).

9. Whilst urban poverty is increasing, human development indicators show thatprogress is being made in respect of health and welfare criteria. Gender inequalitiesremain deeply rooted within most societies, however, and the international agenciesare strongly advocating equality of opportunity and empowerment for women.

10. Whilst the incidence and volume of poverty is decreasing in Asia, andparticularly East Asia, economic performance and the incidence of poverty are instrong contrast in Latin America and sub-Saharan Africa. The number of peopleliving in poverty in sub-Saharan Africa is likely to increase by 40 per cent between

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1990 and 2000.

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Executive summaryIII. The urban economy

11. The pace of urban economic change has accelerated since the early 1980s.Agglomeration economies in city regions are more exposed to internationaleconomic influences and are therefore more volatile than they were. Nonetheless,they contribute about 60 per cent of the gross domestic product (GDP) indeveloping countries, are at the heart of technological changes and will be the focusof the growing concentration of poverty.

12. Dramatic effects are occurring in the urban economies of developingcountries. In India, the liberalization of the economy has induced major injections ofinternational capital into the manufacturing sector and is seeing the rapid introductionof new technology, new production methods and modern management practices. InChina too, the encouragement of 'open door' economic policies since 1979 isresulting in significant amounts of foreign investment in major Chinese cities.

13. Theories of urban bias influenced aid programmes away from urbaninvestment during the late 1970s and early 1980s. These policies have since beenreplaced by market liberalization policies. New directions in urban economicdevelopment favour a whole-sector approach in an integrated way with thepromotion of the national economy; the enhancement of institutional housing finance;joint public/private sector funding for infrastructure and the reform of public sectorfinance.

14. Whilst not particularly new, the international agencies are laying emphasison the productive role of housing in the urban economy. Low-income housinginvestment has a multiplier of about 2 if backward and forward linkages are takeninto account. If one adds the non-monetized contributions of housing to the urbaneconomy then housing and the domestic sector are more significant than is normallysupposed. This raises the significance of housing in the debate on development.

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Executive summaryIV. Trends in the human settlements conditions of the urban poor

15. Chapter IV reviews the human settlements situation of the urban poor inrespect of the growth of urbanization; the nature and extent of urban poverty;housing and environmental conditions; infrastructural provision; and access andavailability of urban land. Whilst in East and South East Asia it is possible to discernimprovements in the housing and environmental circumstances of the urban poor, inmost other regions in the developing world conditions for the urban poor appear tobe deteriorating.

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Executive summaryV. Reaching the urban poor

16. The international policy context for shelter and urban development ischanging. The GSS has since been influenced by the 'urban agendas' of the UnitedNations Development Programme (UNDP) and the World Bank, and by the UnitedNations Conference on Environment and Development (UNCED). Future emphasisis to be placed on improving the operation of essentially privatized markets throughderegulation and institutional support for the private sector. Regularization andimprovement of the informal sector are to be important, whilst state agencies are towithdraw from a direct role in production, allocation and management in favour of anenabling role. The urban management capacity of state agencies is to be enhanced,concentrating attention on such factors as reforming institutional and legalframeworks, improving the delivery of urban land and encouraging partnerships.

17. In reviewing the effectiveness of several case studies in providing low-costaccommodation for the urban poor, the chapter concludes that governments arecontinuing to acknowledge the importance of the GSS and are making progress insome areas (e.g. the development of partnerships with low-income communities),but less in others (e.g. the enhancement of the role of the private commercial sector).The effects overall of economic austerity on the private sector and the contraction ofthe public sector have meant modest progress.

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Executive summaryVI. Reducing the human settlements problem of the urban poor

18. In conceiving and developing enabling strategies, public/privatepartnerships are essential in ensuring the maximization of the comparative advantagesof each sector. Partnerships have been established in a wide variety of circumstancesand there is great scope for the enhancement of partnerships particularly betweenlow-income communities, non-governmental organizations (NGOs) and the publicsector.

19. The scaling-up of programmes involving low-cost shelter and urbaninfrastructural development offers great potential for employment generation forlow-income groups and for women in particular. A shift in favour of labour-intensiveconstruction methods and greater encouragement of the indigenous buildingmaterials industry will also create further employment opportunities.

20. Home-based enterprises (HBEs) are very common in developing countriesand their primary purpose is to sustain the incomes of low-income households.Whilst ensuring that safeguards are enforced, the acknowledgement of shelter's roleas an important workplace for low-income groups will mean further opportunities forencouraging employment generation and raising incomes.

21. Major benefits can be gained for local shelter strategies by encouragingpublic participation and thereby harnessing the efforts of low-income communities.For example:

a participatory approach encourages communities to improve their quality oflife as a whole and not simply in terms of shelter and the physicalenvironment;

the process of successful participation engenders trust between localauthorities, NGOs and local communities;

from the government's point of view it deploys resources commensurate withthe huge scale of the problem; and

community participation can increase the cost effectiveness of a programme.

22. Ensuring an adequate supply of residential land at affordable prices is anabsolute pre-requisite for the development of an effective shelter strategy.Developing countries experience many problems in this area and there is often a needfor major reforms.

23. The absence of formal institutional housing finance is a major constraint tothe development of an efficient housing market. Even where it exists, however, it fails

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to give much help to the urban poor. Nonetheless, important initiatives are takingplace. These appear to offer substantial scope for the development of financialfacilities for the urban poor which may also have wider application in developingcountries.

24. There has been growing concern in recent years over the supply ofbuilding materials in developing countries. There is a need for governments todevelop a strategic approach to the development of the building materials sector, andto diversify production to include small-scale enterprises (SSEs) and other actors inthe informal sector. It is also important that support is available to encourageentrepreneurship and that credit for SSEs is available. There is also the potential foremploying local labour in the production of building materials on an enhanced scale.

25. The absence, or poor quality of infrastructural facilities for the urban pooris a pervasive problem. The consequences for the health and safety of those in slumand squatter settlements and for the public health of millions of other urban dwellersare alarming. Local authorities need to ensure that efforts are made to improveinfrastructural facilities in slum settlements and that by the adoption of a communityparticipation approach, and by ensuring the training and recruitment of femalelabour, they can maximise the beneficial impact of these capital works programmeson poor communities.

26. Building and planning codes are often a hindrance rather than a help intrying to secure an improvement for the urban poor. Standards need to bereformulated in a way which recognises the need for safeguards in terms of safety,security and health of households and communities, but also in a way whichreinforces the efforts of the community. At the same time much greater emphasisneeds to be placed on improved training and management capabilities in localauthorities.

27. In view of the likely future increase in demand for low-cost residentialaccommodation in the cities of developing countries, there is a need to ensure ahealthy privately rented housing market. This implies a review of fiscal and financialpolicies affecting the rental sector; modifications to planning and building regulationsto encourage house extensions and arrangements for letting; and safeguards toprotect the interests of vulnerable tenants. Local authorities will need to make directprovision for the most vulnerable groups.

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Executive summaryVII. Agenda for future work

28. The most pressing need for action is to explore systematically ways ofcountering the growth of urban poverty. Hence this report strongly endorses theUrban Poverty Partnership Programme conceived by UNCHS (Habitat), theInternational Labour Organization (ILO), UNDP and the United Nations Volunteers (UNV). It also repeats the recent call by UNCHS (Habitat) and ILO which urges amajor shift in attitudes and approaches and links shelter provision and public-worksprogrammes to poverty-reduction strategies through the use of labour-intensiveinitiatives.

29. A second issue of concern is the capacity and competence of urbanadministrations to deliver effective public services within an enabling framework inthe area of shelter and urban infrastructural provision. This will require a majorinternational initiative in training, guidance and support for local authorities.

30. Specific policy areas in need of development include: the legal andinstitutional environment for the ownership, transference and management of land;personal savings and the development of private sector institutional housing finance;and the underdevelopment of local materials production, marketing and distribution.

31. There is also a need to strengthen shelter strategies for the poorest groupsby encouraging governments not to abrogate their responsibilities to the poorest; andby ensuring that such resources as are available are used in the most effective way.

32. There is a need to harness the benefits of research and to restore the policydialogue between researchers and practitioners.

33. In future local authorities will be expected to undertake three principal rolesin human settlements development: they will be expected to anticipate populationgrowth and urban expansion and to implement a planned strategy of development;they will need to plan carefully infrastructural provision; and they will be expected toformulate local shelter strategies which enhance the operation of the private market.

34. NGOs will be encouraged to work closely with local communities in actingas enablers, mediators, advisors and trainers.

35. The enabling approach envisages a broader role for the private commercialsector. This implies that local authorities will increasingly need to seek solutions inpartnership with private-sector organizations.

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Executive summaryVIII. Conclusions and recommendations

36. Whilst the overall incidence of poverty is decreasing, in many parts of thedeveloping world both the volume and incidence of poverty are increasing. Womenhave borne the brunt of the problems of poverty. The policy implications in respectof poverty alleviation strategies include:

the need to safeguard human resources development programmes duringmacro-economic adjustment;

to develop longer term programmes to tackle the structural causes of poverty;and

to develop capacity for short-term employment programmes.

37. Those experiencing housing and urban poverty are likely to outnumberthose living in income poverty in urban areas. Moreover, the shelter sector isunder-developed in the supply of satisfactory housing. The generally bleak picture ofhuman settlements conditions also calls into question the effectiveness of the role ofgovernments in safeguarding the interests of the urban poor.

38. The failure of government policies highlights the productivity of the poorthemselves and underscores the need for a major shift in policies and approaches.Projected rates of urban growth further demonstrate the need for change along thelines of the GSS.

39. There is a need for:

UNCHS (Habitat) to mount a sustained international effort to improvecompetence and service delivery in urban land use planning and management;

continued technical and advisory support in the promotion and developmentof institutional housing finance for the urban poor;

governments to review their indigenous materials industry to become moreefficient and effective;

diversification of building-materials production to include SSEs and theinformal sector;

governments to scale-up their housing and urban development activities toincrease employment opportunities for the urban poor;

governments to review current policies with regard to rented accommodationto create a favourable environment for responsible renting strategies;

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local authorities to review development control and building regulations inorder to promote low-cost shelter development;

acknowledging the importance of HBEs and develop a small-enterprisedevelopment strategy for HBEs; and

the development of genuine partnerships between governments, localauthorities and low-income communities and a determination to succeed indeveloping effective local strategies for the improvement of the humansettlements conditions of the world's urban poor.

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Chapter I. Introduction

The Global Strategy for Shelter to the Year 2000 (GSS), which was adopted bythe General Assembly of the United Nations in December 1988, recognized thatdespite efforts in "many countries to prepare national shelter strategies and to adoptother measures that will promote achievement of the goal of shelter for all ... morethan 1 billion people have shelter unfit for human habitation" (UNCHS, 1988). Itfurther recognized that "this number will increase dramatically, partly as a result ofpopulation and urbanization trends." The main objective of the strategy was tofacilitate adequate shelter for all by the year 2000.

As we are approaching the year 2000, the shelter situation is worse than ever.An increasing number of people are living under inadequate shelter conditions. Theproblem is most acute, and most visible, in the inner-city slums and in the sprawlingsquatter settlements on the urban fringe of the rapidly growing cities of developingcountries. As urban populations in most developing countries are growing rapidly, itis becoming evident that present policies for human settlements development fail tocater for the special circumstances of the groups affected by extreme poverty. This,and a worldwide economic recession has meant that the absolute number of peopleliving in poverty is increasing. The largest increase occurs in the urban areas ofdeveloping countries. It is against this realization that this report is prepared, toreview and consolidate the existing knowledge on the human settlements situation ofthe world's urban poor.

Before reviewing the human settlements conditions in which the urban poor live,leading into discussions on the various aspects of enabling strategies and theirpotential for employment generation, however, it is appropriate to outline thedemographic and economic factors contributing to the urbanization of poverty indeveloping countries.

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Chapter I. IntroductionA. The growth of human settlements

The latter half of the twentieth century has seen the continuous transformationof the world's population into urban dwellers. Both figure 1 and table 1 illustrate howthe world's urban population has grown from less than 30 per cent of the total in1950 to more than 45 per cent in 1995. United Nations projections indicate that morethan half of the world's population will live in urban areas by 2005. Three decadesfrom now, by 2025, more than 60 per cent of the population will live in urban areas.

Not only is there a global population shift towards urban areas. We are alsoexperiencing a shift towards developing countries. Some 67 per cent of the world'spopulation were living in developing countries in 1950. By 1995, this figure hasincreased to 78 per cent. Projections indicate that by 2025, 84 per cent of the globalpopulation will be living in these countries (United Nations, 1994). The consequenceof these two trends is that an increasing proportion of the world's population live inurban areas of developing countries. By 1950, the urban populations amounted toonly 17 per cent of the population in developing countries. In 1995 this figure hasincreased to more than 37 per cent. Projections indicate that 57 per cent of thepopulation in these countries will live in urban areas in 2025.

Figure 2 provides an even more striking illustration of the fact that we are livingin an urbanizing world. During the 19651975 period the absolute population increasein rural areas of developing countries accounted for more than half of the globalpopulation increase. Two decades later the picture had been reversed, more than halfof global population growth occurred in the urban areas of developing countries.During this period the average annual urban population growth of developingcountries has increased from 24 million to 51 million people. During the next decade(19952005) the urban population of developing countries is expected to grow at anaverage of some 65 million persons per year. The next decades will see a furtherstrengthening of this trend. In fact, as rural populations are projected to contract by2015, urban population growth in developing countries is expected to account formore than 100 per cent of the total net growth during the 20152025 period, reachinga population growth of some 86 million each year.

It is important to note that less than one half of the urban population growth indeveloping countries is caused by rural-urban migration. Table 2 illustrates this. Thedata in the table should be treated with caution as they are based on the ratherquestionable assumption that population growth rates in urban and rural areas areidentical. In most countries, however, urban households tend to be about 810 percent larger than those in rural areas (UNCHS, 1987). The figures in the table are thuslikely to be high. This having been said, the table indicates that about half of urbanpopulation growth is due to natural population growth in the urban areas themselves.The remainder is due to rural-urban migration and to the reclassification of

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settlements (mostly rural areas that are reclassified as urban areas).

Table 1 reveals the strong inter-relationship between urbanization andindustrialization and in so doing it contrasts the post-war growth in humansettlements between the industrialized and the developing countries. It shows that theindustrialized countries were already largely urbanized by 1950 and that the processhas consolidated in the interim. By way of contrast, the urban population indeveloping countries has grown by 500 per cent from a total of less than 300 millionin 1950 to more than 1.7 billion in 1995. This amounted to a rate of growth aboutthree times that of the developed world. Despite this growth, the proportion of thepopulation currently living in towns and cities in developing countries is only half thatof the industrialized countries (37 per cent as compared with 73 per cent in 1995).

Throughout the developing world, however, the rate of urbanization is by nomeans uniform. Table 1 also illustrates the proportion of urban population byregions in developing countries and compares these figures with global percentages.It shows the narrowing of the gap between developing countries and the world as awhole. By 1995, one in three Africans and Asians are city dwellers, whilst threequarters of Latin Americans are living in cities already. The trends, however, aresimilar. The proportion of the population residing in urban areas is projected toincrease in all regions. Furthermore, the growth rate is highest in the regions currentlywith the lowest level of urbanization (see table 5 ).

Another striking feature of the process of urbanization in developing countriesis the enormous growth in the number of very large cities. In 1950 only 31 cities indeveloping countries had a population of one million or more. By 1995 this figurehad increased to a total of 196 cities with an estimated population of 575 million(United Nations, 1994). Indeed, two-thirds of the population throughout the worldliving in very large cities of five million people or more, are now living in developingcountries.

The above figures set out the statistical dimensions of urban demographicgrowth. It can be argued that it is the conjuncture of demographic growth andeconomic factors which are the underlying causes of the presence and growth ofurban problems in developing countries. These countries have been experiencing a'demographic transition', characterized by a stage-by-stage change in populationcircumstances of concurrent high birth and high mortality rates, resulting in relativelystable populations, to a stage where mortality rates have fallen more rapidly thanbirth rates, consequently leading to a long-term rapid growth in population. Added tothis has been the economics of rural/urban migration whereby many of the landlessrural population, as well as those seeking opportunity, have moved to urban areas.

During this demographic transition, the reality confronting the economics ofurban development lies between two extreme possibilities. On the one hand, an'optimistic' scenario might result in a 'wage and poverty' transition in which rates ofsaving and investment would be sufficient to absorb increased labour supplies,

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consequently increasing the efficiency of labour markets, enhancing the relativeincomes of the poor, and reducing the incidence of poverty. By contrast, a more'pessimistic' scenario is one where the rates of saving, investment and job creationare outpaced by high population growth leading to large and inert underemploymentin the informal sector.

In actual fact, the outcome for most developing countries has fallen between thetwo polarities. Nonetheless, the process of urbanization has resulted in urbanincomes increasing faster than those in rural areas with the result that almost anyposition on the spectrum between optimistic and pessimistic outcomes createsproblems of affordability for the urban poor. High rates of economic growth (as inthe South-East Asian countries, for example), place inordinate pressures on urbaninstitutions and the delivery of services; whereas low growth rates (as in Africa),retard the 'wage and poverty transition'.

When discussing urban growth it should be kept in mind that the definition of'urban' and 'rural' differ considerably from one country to another, and within onecountry over time. The important issue is thus not the precise percentage of thepopulation living in urban areas, but rather the trend. And, "What is perhaps moresignificant ... is the underlying economic and social changes it reveals — that asteadily declining proportion of the world's population make a living fromagriculture, forestry, hunting and fishing" (UNCHS, 1996). Tables 3 and 4 illustratehow all regions experience a shift from agriculture, both in terms of value andemployment. The tables also indicate that the regions with the lowest percentage ofthe labour force in agriculture, i.e. East Asia (24 per cent), Latin America and theCaribbean (25 per cent) and North Africa and the Middle East (40 per cent) are alsothe ones with the highest per capita income. Table 4 also indicates the relativeeconomic importance of the various regions of developing countries. The combinedGDP of sub-Saharan Africa, South Asia, India and China amounts to less than aquarter of the GDP of developing countries and less than 4.5 per cent of the world'stotal GDP, while the population of these regions account for nearly 70 per cent ofthe population of developing countries and 54 per cent of the global population.

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Chapter I. IntroductionB. The urbanization of poverty

Poverty in the developing countries has long been associated with rural areas.The unprecedented urbanization illustrated above, coupled with the effects of globalrecession, has resulted in a significant increase in the scale of urban poverty.Between 1970 and 1985 the absolute number of the world's poor increased by 22per cent, During that period, whilst the percentage increase amongst the rural poorwas 11 per cent, the equivalent increase in urban poverty was 73 per cent (UNCHS,1992d).

If the rate of urbanization in developing countries has had a significant effect onurban poverty hitherto, however, its impact in the future may be dramatic. Thepopulation projections in table 1 indicate that the total urban population indeveloping countries is likely to double before 2020 and reach 4 billion by the year2025. This implies that towns and cities are likely to absorb approximately twice thepopulation over the next 30 years than they have over the last 30 years. Given currentlevels of urban poverty, shortages in the provision of shelter and other essentialurban services, and the poor environmental quality of many cities of the developingworld, this is a formidable prospect.

By moving beyond population growth, to the growth in the number ofhouseholds, we get a better impression of the challenges ahead in terms of housingdemand. Figures 3 and 4 compare regional population increase (urban plus rural)with the increase in the number of households. The result is striking. Whilesub-Saharan Africa is projected to have the largest population increase during thenext decade, followed by India, the largest increase in number of households isexpected in China. In fact, the growth rate of households in China is more than 2.5times that of its population growth, while on the other hand the growth rate ofhouseholds in sub-Saharan Africa is actually lower than its rate of population growth(see table 5). In absolute terms, the increase in the number of households in theindustrialized countries are actually larger than its population increase. During the19952000 period, 1.06 new households will be created for each person added to thepopulation. This stands in contrast with the developing countries where thecorresponding figure is 0.30. The reason for these striking differences is changes inhousehold size. While average household sizes in sub-Saharan Africa and SouthAsia are expected to remain high during the next three decades, household sizes inthe other regions will be reduced significantly. One result of this is that although theabsolute population growth is expected to be reduced slightly from an annualaverage of some 87 million a year during the 19952005 period to about 83 millionduring the 20152025 period, the average annual increase in the number of householdsis projected to increase from 32 million to 35 million. As most of this increase willoccur in urban areas, the challenge in terms of urban housing supply is immense.

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United Nations (1993b) has noted that only "One in every four newly formedhouseholds has access to standard authorized housing .... On average, nine newhouseholds were formed for each new standard dwelling built in the low-incomedeveloping countries during the 1980s" while two new households were formed foreach new standard dwelling built "in the middle-income countries". In fact, thehousing crisis of developing countries is so severe that in many cases one-roomdwellings have been split up into units in which several households livesimultaneously or alternate with one another in night and day shifts.

While by 1980 'only' one third of all poor were living in urban areas (40 millionout of 120 million households) this situation is projected to be reversed by the year2000. By that time the number of poor urban households is projected to grow by 76per cent to 72 million, while the number of poor rural households will have beenreduced from 80 million in 1980 to 56 million in 2000 (UNDP, 1990). This trendleads UNDP to state that the "persistent problem is that attempts to tackle urbanpoverty directly — by creating jobs and providing public services unavailable in ruralareas — simply attracts more of the rural poor, and their migration wipes out anygains" (UNDP, 1990). This, however, is not an argument for not doing anything tothe problem of urban poverty. People are not becoming poor because they movefrom rural to urban areas. In most cases they simply remain poor, despite moving.

Moreover, when it is acknowledged that the highest rates of urbanization arealready taking place in the poorest regions of Africa and Asia (see table 5 ), it is alsolikely to mean that the twin problems of urban poverty and inadequate humansettlements conditions in urban areas of developing countries constitute two of themost fundamental challenges to politicians and policy-makers throughout the world.These circumstances serve to highlight the strategic significance of Habitat II — the'City Summit' — in seeking genuine, worldwide support for a global strategy whichseeks to improve living conditions and the quality of life in urban areas, whilst at thesame time combatting the problems of urban poverty effectively.

The formulation of effective strategies, however, begins with the assembly ofreliable information and the application of rigorous analysis. Chapter II, therefore,begins with a discussion of the concept of urban poverty. Whilst the nature ofpoverty is seen to be a universal phenomenon it is acknowledged also as a productof situational circumstances reflecting differing political economies. Moreover, asanalyses of poverty have moved on from the quantifiable approaches associatedwith development economics, more recent anthropological studies have highlighteddifferent perceptions of poverty and so the concept itself has become morecomplex. The chapter also distinguishes between poverty as a measure of income,and housing and urban poverty, the primary focus of the current study. Someindications of the scale of urban poverty are presented as well as those groups mostaffected.

As a consequence of these discussions and the figures presented above, thisreport focuses attention on the problems of urban poverty and human settlements

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conditions in developing countries. Yet, in focusing on developing countries, theincidence of urban poverty in other regions should not be forgotten. For example, inCentral and Eastern Europe and in the countries of the former Soviet Union politicaland economic change during the last decade have resulted in imploding economiesand a dramatic fall in the standard of living for many people in these countries. Norhave the more affluent Western countries altogether escaped the effects of worldrecession. The exposure of the older, heavy industries in these countries, especiallythose in the manufacturing sector, to greater international competition has resulted instructural economic changes and growing levels of unemployment. Coupled with achange in political philosophy towards welfare provision in several countries inEurope and North America during the 1980s this has resulted in cuts in social welfareprogrammes and the re-emergence of significant members of homeless and destitutepeople. This phenomenon has resulted in a process of 'social exclusion' for thosegroups.

The impact of the changing nature of the international economy upon localizedeconomies is one of the themes of chapter III. This chapter highlights thesignificance of the economic role of cities and city-regions and the changes takingplace in the urban economy as a result of the increasing influence of StructuralAdjustment Programmes (SAPs), and other macro-economic factors, and theliberalization and deregulation of the global economy. Emphasis is also laid upon theproductive role of housing and its significance to the urban economy. In addition toits quantifiable economic role, the non-monetized contribution of housing and thedomestic sector, and its implications for gender roles, is also discussed. All of thiscontributing to the view that the economic role of the shelter sector and relatedinfrastructure provision remains undervalued and underdeveloped in the urbaneconomies of many developing countries.

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Chapter I. IntroductionC. The challenge of the human settlements conditions of the world's urban poor

Following the context of these initial chapters, the remainder of the report islargely concentrated upon the challenge to politicians and policy-makers presentedby the human settlements conditions of the world's urban poor. Chapters IV-Xoutline the circumstances prevailing in each region of the developing world andattempts to identify trends that affect the urban poor. The outcome is a catalogue ofmiserable conditions on an extensive scale throughout the developing world. In someregions there is evidence of improvement (e.g. China and some other countries inEast Asia and the Pacific), but in others (and particularly sub-Saharan Africa), thereis considerable evidence to the effect that human settlements conditions aredeteriorating with adverse consequences for the health, safety and security of thepopulation, and most particularly for the urban poor.

The changing policy response of the international agencies in respect of humansettlements development is set out in chapter V. This embraces the new agenda ofthe enablement framework of the GSS and incorporates the refinements of policydevelopment in the interim, including a growing sensitivity towards gender issues,enhanced environmental awareness, the need for sustainable solutions, and anincreasing concern over the increasing numbers living in poverty. Moreover, to givea flavour of the responsiveness of government policies to these strategic guidelines,several case studies of recent shelter initiatives for the urban poor are reviewedwithin the context of this 'new agenda'.

In light of the expressed concern over human settlements conditions in manydeveloping countries and the simultaneous view that the shelter sector and relatedaspects of infrastructure provision and public works remain underdeveloped,chapter VI highlights the potential for development across a spectrum of policyissues central to the operationalization of the enablement framework of the GSS.Most importantly, this includes a discussion of the scope afforded for employmentgeneration both in respect of construction and related activities associated withhuman settlements development, as well as ways in which an acknowledgement ofthe use of shelter as a workplace can also be fostered in order to furtheremployment, and subsequently generate higher levels of income.

Chapter VII is concerned with establishing an agenda for further research andsupportive activities necessary to sustain progress in addressing the problems of thehuman settlements conditions of the world's urban poor. It also anticipates thechanging nature of the roles of the various actors in the shelter delivery process,involving the public sector, the private commercial sector, NGOs andcommunity-based organizations (CBOs) with regard to improving human settlementsconditions.

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The conclusions and recommendations of the report are stated in the finalchapter.

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Chapter II. The concept and scale of urban poverty

Poverty is not such a straightforward notion as it might seem. It can beconceptualized, operationalized and measured in a variety of ways. It is also political,in the sense that it is closely related to policy issues in economic, social and politicalsystems. Although it makes some sense to proceed by examining poverty in a globaland analytical way, it should be kept in mind that the political and economic contextis also relevant. The attributes of poverty will vary according to whether their contextis in developing or in industrialized countries. Moreover, anti-poverty programmeswill be influenced by national and local institutional conditions of culture, socialfunctioning, and politics. In the current world, conditions of poverty are dynamicrather than static. Changing economic structures create new classes of winners andlosers; macro-economic performances in some countries are cyclical; and welfaresystems themselves are subject to change and reform with consequences which alterthe boundaries between social inclusion and exclusion.

Poverty should thus be looked upon from contrasting long and short-termperspectives. Long-term perspectives are related to stages of economic developmentand the nature of society. For example, in industrialized countries mass poverty hasbeen eliminated but the remaining poverty is more difficult to reduce. It is related tounemployment, old age and disability, and sometimes to distortions in welfaresystems which create states of dependency. By contrast in many developingcountries long-term poverty is often related to the relationship between the'demographic transition' and the economy. One aspect of the demographic transitionis that some 35 million young workers are placed on to the labour market every year.Unless saving and investment rates are sufficient to increase capital (i.e. factories,offices and equipment), to absorb the increased supplies of labour into formal sectoremployment, young people will be dependent upon the largely low-earnings in theinformal sector to make a living. In other words, much poverty is a structuralcondition of evolving demographic and economic systems. For countries which areexperiencing the transition from socialism to capitalism, the long-term circumstancesof poverty are different again. For these countries, labour markets and price systemsare in a process of liberalization, thereby altering the patterns of living costs andincome distributions. Consequently inequality and poverty increases, and state rolestend to be in transformation from centralized command over resources to somesocial policy provisions.

It is thus clear that various societies have long-term structural conditions whichinfluence the level and nature of poverty. The long-term conditions are made morecomplex from the operation of successive periods of short-term changes. Marketsare volatile in the modern world; macro-economic fluctuations mediate theirinfluences through labour markets changing short-term patterns of incomedistribution; and technological and other changes lead to changes in city-regional

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industrial capacity (see chapter III). All of this means that poverty is short-term aswell as long-term in its incidence and patterns. At the policy level it is necessary toformulate policies so that they appropriately relate to both long-term and short-termconditions. Much evidence now exists to indicate that policies make a difference. Inthe context of macro-economic policies for (austerity) stabilization some LatinAmerican countries experienced an increased incidence of poverty and someincreased inequality in the 1980s. However, Chile, which experienced successiverounds of economic recession in the 1970s and 1980s, adopted targeted policiestowards the low-income groups to ensure social safety nets for the poorest in health,education, housing, nutrition, and employment (Casteñada, 1992). Accordingly,progress with human development indicators in Chile accelerated: whereas infantmortality in 1960, for example, was 119.5 per 1000 live births, by 1988 it improvedto 18.5 per 1000. Some highly performing countries in Asia also maintainedcontinuing progress in human development and in the reduction of poverty.

Table 6 provides a useful overview of the impact of various types of economicreform on workers. As can be seen from the table, urban workers — and femaleworkers in particular — in the "Latin American" and "sub-Saharan African pattern"have been affected by the reforms negatively, while the effects on the agrarianeconomies of Asia have been more positive. In all reform patterns, however, theunskilled workers are the ones that loose. As unskilled workers are more likely to livein poverty, and as women are over-represented among the poor (estimated to 70 percent) the main conclusion of the table is that economic reforms have had an adverseeffect on the poor, and in particular on the poor in Latin America, the Middle Eastand Africa.

From the perspective of the mid-1990s it is possible to obtain a useful overviewof the nature of policies which lead to reductions in poverty and progress in theimprovement of human indicators. Countries with this experience include HongKong, the Republic of Korea, Singapore and the Chinese Province of Taiwan. Thecommon denominator of these countries may be summarized as that the countrieshave had: (1)

long-term economic and political stability over some 3050 years;

liberalized, export-led, economic policies;

state roles in institutional reform, including establishing appropriate propertyrights for both market and state economic functioning, with 'market friendly'effects; and

effective human resources development in health, education, and on-the-jobformation of skills in flexible and adaptable labour markets. This humanresources development will have been within sustained public policies withimportant roles from government agencies in social policy and welfare.

The above discussion on variable global regional performances and policies is

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necessarily generalized rather than revealing contrasts between the averages and theconditions of the poorest in any developing country. In order to obtain a broaderview, it is possible to summarise the living conditions of the poorest. In largecongested cities the poorest will pursue their shelter needs in a variety of ways.Some will rent room space in a shift system, paying for a few hours respite from theoutside world. Others will occupy crowded rental accommodation or dwell onpavements. The more settled poor will seek self-help housing solutions, oftencommencing their housing careers on the edge of large cities with a small hutmentwithout basic services. Some groups are particularly vulnerable to conditions ofpoverty, to grossly under-supplied housing and to the dynamics of urban land andhousing markets. Low city-wide supplies of housing force the poorest — and mostvulnerable — groups into the lowest end of housing markets. This can especiallyaffect women-headed households, low-income large families, and new migrants fromrural to urban areas. Vulnerability extends even to housing improvement schemeswhere policy-makers improve basic sanitation and infrastructure services.Improvements can heighten the competitiveness of housing markets withmoderate-income groups displacing the poorest as rents and costs rise affecthousing improvement (UNCHS, 1991c). Generally the poor experience changinghousing careers in urban areas, with some improving their conditions and othersremaining in the lowest ends of housing markets. The flavour of housing careers isdepicted in box 1 below. The examples indicate that relationships between poverty,housing and the urban human settlements condition are complex and dynamic. Theserelationships are subject to some preliminary discussion in the next sections, withfurther elaboration of urban dynamics in the next chapter.

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Chapter II. The concept and scale of urban povertyA. Income and housing poverty

The ideas of housing poverty and urban poverty are not simply extrapolationsor straightforward applications of the idea of poverty. They are subject to factorsand determinants that do not arise in the simplified idea of income poverty. Thissection will thus explore the conceptual foundations of income, housing, and urbanpoverty, beginning with income poverty.

At the technical level much progress has been made since the 1970s inmeasuring and evaluating income poverty, including its scope, its depth, itsgeographical incidence and the inequality within poverty (see Lipton and van derGaag, 1993; van der Hoeven and Anker, 1994). Various operational measures ofpoverty are available, each having its relative merits. The simplistic approach is todefine a subsistence or calorific budget level and cast this as an 'absolute' povertyline, in developing countries sometimes specified as $1 daily, as is the case with thepoverty line used by the World Bank (see table 7 ). From this poverty line, it ispossible to compare performances through time and comparatively among countries.The measure is not free of dilemmas, for example, of relying upon differing culturaland situational conditions, consequently introducing elements of a relative povertyline into the definition. A 'relative' poverty line allows for purchases which areculturally or socially 'essential' and related to norms in the wider society, includingamong the non-poor. Both absolute and relative poverty lines can be used toestablish 'headcounts' of the numbers in poverty.

The above measures of income poverty omit some important considerations,however. In themselves they indicate virtually nothing about the intensity of poverty,about the necessary redistributions of GDP which would be necessary to eliminatepoverty, and about the inequality within poverty which is important for asking thequestion: How poor are the poorest of the poor? Thus, various poverty indexes havebeen devised to elaborate the operational concepts of poverty. A 'shortfall index'calculates the average income level of the poor (this being below the poverty line),and from this it is possible to specify the proportion of GDP which would benecessary to redistribute resources nationally to eliminate poverty. In greaterelaboration, poverty can be measured in relation to the inequality in incomedistribution among the poor, this having the advantage of incorporating sensitivity tothe intensity of poverty. It is also, of course, possible to classify poverty into suchcategories as geographical region, ethnicity, age, and gender, consequently revealingmore. All the foregoing operational conceptualizations of income poverty have theiruses, but they do not tell us all we would need to know about poverty. For example,as suggested above, they do not establish an analytical relationship between incomepoverty on the one hand and housing and urban poverty on the other. Also, povertyhas to be understood in some basic philosophical and political ways in order todeepen our understanding of the meanings which can be attached to poverty.

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Viewing poverty in a political way is to see it as significant in economic, socialand political processes. Several recent authors argue that in these broad politicaldimensions poverty is much more than a matter of operationalizing it to forms ofmeasurement. Chambers (1995) asks questions about how the poor themselvesunderstand the significant aspects of their poverty. He finds that they are concernedwith their vulnerability to unemployment, to disease and to such contingencies of lifethat would undermine their security. Moser (1995) commences from the position thatcountries are routinely subject to economic review and sometimes to correction, butfar less so to a social audit of their performances. She wishes to introduce socialaudits based on some general administrative reforms in the public sector. Reformsare necessary because the public sector tends to be divided into social agencies in afragmented way. The requirements for a social audit are for overall reviews, drawingtogether the fragmented agencies to address such things as poverty, quality of life,and human development. In other words Moser advocates a 'holistic' and 'unified'view in establishing and implementing social audits. Wratten (1994) also favours aholistic approach, noting that the mere measurement of poverty does not in itselfengage the participation and integration of the poor into social, economic andpolitical processes. Poverty is thus seen as a broad-based concept woven deeplyinto social, economic and political fabrics.

Broadened views of poverty originate not only in studies of political and socialsystems. They have also become part of the philosophical study of humanwell-being. The philosophy of wellbeing is important because the way poverty isunderstood influences social perceptions and, sometimes, policy formulation. Asnoted by Kymlicka (1990), since the 1960s there has been a range of competingtheories of the political philosophy of well-being. These include theeconomics-based ideas of utilitarianism (i.e. the pursuit of 'happiness' in society), arecourse to formulations founded upon egalitarianism (the major one of which isRawl's theory of social justice), and Sen's ideas of 'capability welfare' (Sen, 1992;1994).

Poverty should, however, not only be considered in the context of 'haves' and'have-nots'. Within the overall framework of enabling shelter strategies it should alsobe considered in view of the 'can-dos' and 'cannot-dos'. A majority of pastinterventions to improve the human settlements conditions of the urban (and rural)poor have in practice ended up as subsidies for the 'not-so-poor', and even tomembers of the middle-income group (UNCHS, 1991b). It is thus of utmostimportant to identify who the poor are (and who they are not). Figure 5 illustrateshow this can be done, by making a distinction between the 'poor' and the'lower-income group' and between 'destitutes' and 'working poor'. By destitute ismeant "those in utter destitution, who only in very favourable circumstances will beable to achieve an improved life. They are often handicapped in some way, or areeither very young or old" (UNCHS, 1994). These are the ones for whom enablingshelter strategies means little or nothing. It is only by assisting the not-so-poor tohelp themselves, that resources can be made available to assist this group. Such

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direct assistance must be shaped by other principles than affordability and costrecovery. The term "working poor" does not imply that the people in this categoryare actually employed, but rather that they are employable:"Within an enabling environment the working poor will be able to make a living,house themselves and obtain some services for which they can pay. The 'workingpoor' includes different groups, for instance people who work long hours for verylow pay or who are engaged in low renumerative business. They have recentlybeen joined by workers in the lower grades of government and private sectoremployment. A large category of the working poor are women who are heads ofhouseholds. They have typically low levels of education and lack marketable skillsand easy access to credit" (UNCHS, 1994).

Most standard measures of poverty are closely tied to income and householdbudget levels. Extending the topic from poverty to well-being adds other humandevelopment indicators such as mortality and literacy rates. UNDP has since 1990calculated a human development index based on a composite of GDP per capita,health and education indicators, as well as measures of income distribution (UNDP,1990). Housing is a central aspect of urban poverty and well-being. Yet, to date ithas not been included in the human development index, despite the work undertakenby the United Nations and World Bank on developing housing and urban indicators.The really significant point in all of this is that, though related, income poverty andhousing poverty are not the same thing. Undoubtedly, low income is frequently amajor cause of housing poverty, but such housing-related conditions as lowsupplies, ineffective land policies, inappropriate building codes, and imbalances intenure and finance can also be significant in assessments of housing poverty andaffordability. The criteria which determine the existence of housing poverty includehigh rent/repayment-to-income ratios, substandard and unfit housing conditions, andsubstantially blocked access to adequate housing. All the foregoing matters arecentral in discussions of housing poverty, all to some extent affecting the quality oflife of pavement dwellers, squatters, slum dwellers, and public policy responses tolow-income housing problems. Housing poverty is also significantly influenced bygeneral economic conditions including inflation, unemployment, rapid changes in thestructure of the economy (a phenomenon of the post-1970 world), and changes inthe rate of interest. High rates of inflation, recession-induced unemployment, theredistribution of the advantaged and the disadvantaged in structural change andincreasing rates of interest can all bring adverse effects to the housing sector, andsometimes increase housing poverty. More is said about these housing and urbanpoverty effects later in the chapter. Meanwhile, in the light of these notions ofhousing poverty it is clear that housing has to be conceptualized as something morecomplex than mere shelter.

If housing professionals and policy-makers are to formulate policies andpractices in urban housing as whole sector development, then housing should beunderstood as linking 'top-down' and 'bottom-up' perspectives. Accordingly, it isrelated to development policies and performances, to long and short-term

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macro-economic conditions, to urban economic and demographic development, andto the land-fixed nature of urban growth and change. It is thus closely associatedwith policies and delivery systems in land, in infrastructure services, in financecapital markets, and in regional-local governance which often comprises vertical andhorizontal intergovernmental and inter-agency relations. All of this brings housingboth within multi-objective and multi-institutional relevance, with associated issuesfrom the political economies of efficiency, distributional justice, poverty, pragmaticfeasibilities, and broad concerns for income and housing poverty. Income poverty isprimarily about the necessities for subsistence and the adequacy of resources fordignified living conditions. Housing poverty is about the price-access to sanitaryhousing, to affordable rent-income ratios, and to satisfactory health andenvironmental conditions in low-income living areas. Housing is also related to thegeneration and distribution of 'urban welfare'. Urban welfare is associated withprimary income from earnings and other monetized sources. But it also includes thevalues of social benefits (and costs), housing-related externalities in locational(dis)amenity and environmental conditions. Urban welfare is generated in conditionsof changing inequalities, and property rights in land, housing and other assets caninfluence levels and distributions of urban welfare.

Thus conceived, housing and urban welfare has a number of usefulapplications. It adds significance and information in reviews of urban poverty; it canbe used in developing integrated urban social policies; and it enlightens theconstituent elements in housing and urban sector development. These are the themesin the remaining part of this chapter and in the chapter that follows.

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Chapter II. The concept and scale of urban povertyB. The scale and characterization of urban poverty in developing countries

From the earlier discussion it should be borne in mind that the term 'urbanpoverty' has more complicated conceptual foundations than simply measurement ofincome poverty in urban areas. It includes wider notions of urban welfare with itsassociated meanings to housing poverty and the price-access to urban utilities andinfrastructure. Nevertheless, headcounts of absolute poverty can provide somerelevant indications of poverty. Table 7 provides the most recent World Bankestimates and projections of global and regional poverty over the period 1985 to2000. This shows that although the incidence of poverty in developing countries as awhole has fallen and is expected to continue to fall before the year 2000, the totalnumber of those in poverty is expected to be higher by the year 2000 (at 1.1 billion),than it was in 1985. The greatest incidence of poverty is to be found in sub-SaharanAfrica and in South Asia (including India) where almost half the population wereclassified as living in poverty in 1990. In terms of absolute numbers the greatestconcentrations of poverty are in South Asia (including India). According to thefigures in table 7 , half of the worlds's poor population (some 562 million people)live in this region. By the year 2000 it is anticipated that the incidence of poverty islikely to fall in all regions with the exception of sub-Saharan Africa, which has moresevere problems than other regions, because of low economic growth and high ratesof demographic growth and urbanization. In numerical terms, however, the numberof those experiencing poverty is likely to grow in Latin America and the Caribbean,North Africa and the Middle East and substantially in sub-Saharan Africa.

As outlined in chapter I, the numbers experiencing absolute poverty in urbanareas are increasing much faster than those in rural areas and continued rapidurbanization suggests this trend is likely to continue. The estimates in table 7 do notdifferentiate between rural and urban poverty, but if a consistent rate of urbanpoverty to that which existed in the late 1980s (i.e. 25 per cent), were applied to theurban population in developing countries in 1995, then the current number of citydwellers living in poverty would be about 430 million. This compares well with aprevious World Bank estimate (1988a) that by the year 2000 some 425 millionpeople will be living in absolute poverty in urban areas. (2) By that time 90 per cent ofall poor in Latin America will be living in urban areas. Similar figures for Asia andAfrica are estimated at 45 and 40 per cent. Table 8 provides a World Bank estimateon the incidence of urban poverty by the late 1980s. The largest number of urbanpoor is to be found in Asia, while the incidence of urban poverty is higher insub-Saharan Africa, where nearly every second urban dweller live in poverty.

Table 9 contains estimates from UNDP on the extent of poverty in developingcountries (UNDP, 1994). In contrast to the World Bank's data — which are basedon one common poverty line for all countries — the UNDP estimates are based onpoverty lines in the individual countries. As can be seen from tables 7 , 8 and 9 ,

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there are no general agreement on the extent of poverty. The extent of poverty inLatin America and the Caribbean and in sub-Saharan Africa, in particular, differconsiderably between the various estimates, with UNDP's estimates about 100million higher than the World Bank's for each of the two regions. The UNDPestimates of urban poverty, however, are lower than those of the World Bank forsub-Saharan Africa (63 per cent of World Bank figures) and for North Africa andthe Middle East (50 per cent of World Bank figures).

The use of one common poverty line for urban and rural areas tends tounderestimate the scale of urban poverty. This is particularly the case in the currentsituation of rapid urbanization, when an increasing number of developing countriesexperience negative population growth in rural areas. The relatively higher cost ofhousing and/or food in urban areas should be taken into account when definingpoverty lines, even despite the fact that access to services such as health care, safewater and sanitation tends to be considerably better in urban than in rural areas (seetable 10 ) (3) . Yet, despite these reservations, some 180 million urban dwellers areliving without access to safe water (12 per cent of the urban population, comparedto 40 per cent of the rural population), and a staggering 500 million without access toproper sanitation facilities (31 per cent of the urban population, compared to 82 percent of the rural population). In fact, some 600 million urban dwellers live in life- andhealth-threatening houses and conditions characterized by overcrowding and lack ofbasic services such as piped water, sanitation and health care (WHO, 1992). Thisfigure is about twice as high as the figures presented by the World Bank and UNDPon the volume of urban poverty.

What does all of this mean in terms of portraying poverty and in response tothe question: Who are the poor? Some earlier references to housing careers andpoverty were set out in box 1 . The World Bank's portraits of poverty (World Bank,1990) include a family of seven in Ghana living in a meagre hutment without basicservices, with their income derived from subsistence activities; and a Peruvianhousehold living in a shanty-town shack without sanitation and electricity services.The Peruvian household obtains its water from a standpipe some 450 metres fromthe shack, and the adult earners are dependent upon intermittent work at low pay inthe informal sector. Box 2 provides a telling description of the daily life of manypoor urban dwellers.

Generally, we may say that the poor include the following:

large families with high dependency ratios (i.e., high proportions of the youngand the aged who are not in gainful employment);

sections of the population which are un- or underemployed: This meansvulnerability to fluctuating employment opportunities in the low end of labourmarkets in the informal sector;

the poor are disproportionately women (about 70 per cent), includinggrowing numbers in female-headed households;

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the illiterates: the poor generally lack basic education and are often illiterate:some 20 per cent of the poor urban males are illiterate and some 45 per centof the females; and

those with low status and no social support, such as street children and otherdestitutes.

Poverty is thus seen as a consequence of gender inequality, low productivity inthe informal sector, vulnerabilities in changing labour markets, a lack of basiceducation, and the absence of social support. These are all aspects of long-termeconomic and social development, and as argued earlier and subsequently in thischapter, are largely a matter of the quality of development policies and the structuralrealities of comparative stages of economic development.

Although structural poverty, is — as we have seen — a problem of substantialvolume in developing countries, it should be appreciated that some real progress hasbeen made in the well-being of millions in many countries. Various reviews ofprogress in human development (e.g. Lindenberg, 1991; UNDP, 1995) indicate thatin overall performance the developing countries have made as much progress inhealth and educational improvement in a generation than the richer countries did in acentury of development. Since the 1960s infant mortality has been halved indeveloping countries and school enrolments have increased by some 50 per cent.Life expectancy in the developing countries has improved by some 17 years,reaching 61 years, compared with industrial countries at 76 years. These are, ofcourse, averages and as such they hide wide differences in performances amongcountries. The improvement has been achieved notwithstanding some increasedinequality among nations, and in relative terms the GDP per head of the population indeveloping countries is only 5 per cent of the levels in the industrial countries.Nonetheless, some of the poorest countries (e.g. Sri Lanka) have performedcomparatively well on human development indicators. Such countries have achievedthis with long-term political and administrative commitments to welfare and humanresource development.

Gender inequality in human development is becoming increasingly significant inreviews of progress with human development indicators. It is the leading feature inthe 1995 Human Development Report (UNDP, 1995). Some 70 per cent of theworld's poor are female and it is predicted that this ratio will rise. Some of thisreflects gender disparities in human resource development, especially in education,health and training. As suggested by UNDP, even though education and health areimproving among women, in social and economic processes economic opportunityare still not enough open to women. The UNDP calls for equalities of opportunityand the empowerment of women. Kymlicka (1990) goes further. He emphasizes thatreformist attention needs to be given to the gender inequalities in domestic labour(especially in childrearing responsibilities), and in the relationships between theout-of-home 'public' world and the 'at-home' private world. Gender inequalities aredeeply structured within most societies, and many of them have adverse

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consequences for overall social and economic development. Nevertheless, policiesand cultural differences do have some effect upon gender inequalities. The humandevelopment index (UNDP, 1995) is recomposed to measure a gender sensitivecompanion index. The resultant gender development index reveals that somecountries are consequently re-ranked with their gender development index abovetheir human development index rankings, and others are re-ranked negatively on thegender development index.

This section has revealed some of the conceptual and statistical dimensions ofpoverty, also indicating answers to the question: who are the poor in developingcountries? It has been seen that poverty is very much related to informal sector lowincomes, to large dependency ratios in families, to low levels of education and skill,and to deeply structured gender inequalities. Though closely related, incomepoverty, housing poverty and urban poverty are not the same thing conceptually.Income poverty is based upon income, whilst housing poverty is related to rent andrepayment ratios (along with overcrowding and substandard conditions), and urbanpoverty to the price-access to essential utility services. The existence of squattersettlements and slum living conditions is suggestive of the co-existence ofaffordability and low housing supply problems. At the policy level the implicationsare towards long-term development to have positive effects upon income growth(especially in the bottom 40 per cent of the distribution of household incomes), uponwhole housing sector development to improve supplies, and upon extending basicurban services.

The following discussion will continue the discussion on affordability andsupply issues. Meanwhile it is appropriate to review some contrasting regional urbanpoverty experiences.

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Chapter II. The concept and scale of urban povertyC.1. Regional experiences of urban poverty: Asia

As indicated earlier Asia includes countries which have pursued successfullong-term development policies (i.e. Hong Kong, the Republic of Korea, Singaporeand the Chinese Province of Taiwan. Furthermore, during the 1980s the two mostpopulous countries in world, China and India, both experienced satisfactoryeconomic growth. It is thus not surprising that in Asia as a whole both the incidenceand the volume of poverty have decreased over the last decade. Yet, some 730million people in Asia remained in absolute poverty in 1990. Economic growth maytend to reduce poverty, though not consistently at all times and in all places. Theperformance in poverty reduction has been uneven.

Table 11 provides a useful representation of poverty, housing and urban livingconditions in four of Asia's large metropolises, Manila, Jakarta, Calcutta andMadras. It can be seen that notwithstanding progress in reducing poverty andpromoting human development, very substantial problems continue to exist. Forexample, it is estimated that some 60 per cent of Calcutta's population is living inabsolute poverty; that urban population growth in Jakarta are high at 4 per cent perannum; that in Madras some 60 per cent of population lives in substandard housing;that 50 per cent of the labour force in Manila is in the informal sector; and that some58 per cent of Jakarta's residents do not have satisfactory access to human wastedisposal systems. Statistical magnitudes are one thing, and the life's experiences ofthe poor another. In many Asian cities urban living conditions can be described as adrama involving millions. For example, in China with the post-1978 progress of thecountry towards some market liberalization and modernization, rural income hasbeen stagnating in the mid-1990s. This is leading to massive migration and thedevelopment of squatter settlements in Beijing's Henan, Kingiang and Zhejiangdistricts.

A number of studies on urban poverty commissioned by the AsianDevelopment Bank (AsDB) indicate that the incidence of income poverty hasdecreased in various countries. (4) Moreover, in its most recent review of economicprospects for development, the World Bank concluded that, "South Asia andparticularly East Asia and the Pacific are expected to achieve appreciably moregrowth than the estimated minimum needed for the number of poor to fall" (WorldBank, 1993c). This is consistent with the estimates illustrated in table 7 above whichanticipated a significant decrease in both the incidence and volume of poverty in theregion by the year 2000, with a dramatic fall taking place in East Asia. Nonetheless,as chapter IV demonstrates, the housing and environmental conditions of the urbanpoor in cities throughout the Asian region remain miserably inadequate, whichsuggests that — alongside policies to sustain economic growth — sectoral policiesin land, infrastructural development and housing also require urgent attention.

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Chapter II. The concept and scale of urban povertyC.2. Regional experiences of urban poverty: Sub-Saharan Africa and Latin America and the

Caribbean

Within the context of the increasing globalization of the world economy themost vulnerable regions in terms of economic performance and political instabilityare sub-Saharan Africa and Latin America and the Caribbean. In sub-Saharan Africa,for example, the region's share of global trade has fallen from 3.8 per cent in the1970s to just 1 per cent in the 1990s. As a result, the total external debt more thantripled between 1980 and 1989, and in it 1992 was equal to the GNP of the region asa whole. In 1990 debt service payments amounted to 22.1 per cent of the total valueof the exports of goods and services as compared with 10.9 per cent in 1980(Saitoti, 1993). Many countries of the region have entered into SAPs with the WorldBank and the International Monetary Fund (IMF). Yet, the outcome is thatsub-Saharan Africa has become a net exporter of financial services:"Between 1983 and 1990 the fund's [IMF] net operations in sub-Saharan Africahave resulted in a massive net transfer of resources from Africa, amounting to acumulative figure of US $ 4.6 billion" (Saitoti, 1993).

Despite the relatively early development of industrialization and urbanization inLatin America, the region was hit by economic crisis in the early 1980s. This wascharacterized by international indebtedness, the stagnation of production, high andsometimes hyper inflation, falling incomes and growing impoverishment."Between 1980 and 1989, the overall gross national product of Latin Americaand the Caribbean declined by 8.3 per cent ... only Chile, Colombia and Cubamanaged to grow. Most of the rest experienced major recessions with per capitaincome in Argentina, Ecuador, Peru and Venezuela declining by aroundone-quarter, and in Nicaragua by one third" (Gilbert, 1994).

These financial difficulties meant that many countries in Latin America andsub-Saharan Africa were among the first to enter into SAPs with the World Bankand IMF. These programmes generally had two components. The first componentwas stabilization in the form of austerity packages to correct imbalances in thebalance of payments and excessive inflation. The second component consisted ofthe liberalization of markets, export-led growth, exchange rate re-adjustment (usuallydevaluation), privatization, and reforms in taxation and public expenditure.Experience shows that the stabilization policies did not always in themselves providegrowth because growth depended upon a wider set of conditions. These includedhuman capital formation, skills development, entrepreneurship and related matters, asreviewed in earlier discussions in this chapter.

What were the consequences of stabilization and structural adjustment uponpoverty in Latin America and sub-Saharan Africa? First, it should be appreciated thatthis question cannot be answered in clear-cut and uncontroversial ways. Problems

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arise in the methodology used for assessment (Berg and others, 1994). It is not easyto establish base lines for comparing countries with and without adjustment policies;countries entered adjustment from different positions at varying times; and it isdifficult to establish an agreed set of classifications and criteria for assessment. Foreach of these reasons it is virtually impossible to attribute the results betweenadjustment policy and general economic causes and effects. Second, it should berecognized that for many developing countries the 1980s was a difficult decade,regardless of whether countries entered into formal adjustment and stabilizationpolicies. For example, energy prices increased in the early 1980s, exports sometimesdecreased in the face of international economic recession, the terms of tradedeteriorated in many developing countries, and financiers withdrew their sources offunding. Yet, as was outlined in table 6 , the impact of these policies have, in general,been rather negative for the poor (and in particular for female unskilled workers inurban areas).

Table 12 illustrates the economic performance of selected Latin Americancountries during the period of macro-economic adjustment. It may be seen thatwhilst there is evidence of an upturn in economic activity in the late 1980s and early1990s, this is not universal and some economies have reacted more favourably toderegulation and exposure to international competition than others.

Economic performance in many sub-Saharan African countries over the sameperiod has also been very poor with per capita incomes falling in several countries,and some countries also experiencing reduced levels of public expenditure andinvestment (Stewart, 1995). Whilst human development indicators have continued toimprove, albeit at a slower rate than in the 1970s (5) , the World Bank figures ( table 7) show that — in contrast to trends for the developing world as a whole — both theincidence and volume of those living in poverty increased in Latin America andsub-Saharan Africa during the latter half of the 1980s.

As to future prospects for economic growth, the World Bank (1993c)anticipates that the future rate of growth in Latin America and the Caribbean will besufficient to create a reduction in the incidence of poverty, but its projections showan increase in the numbers of those living in poverty to 126 millions by the year 2000(see table 7 ). For sub-Saharan Africa the prospects are grim:"Under current growth projections ... sub-Saharan African countries are expectedto grow by only 3.3 per cent, whereas the minimum growth rate that would beneeded to reduce the number of poor is 4.7 per cent.... Thus, under currentconditions and expectations, the number of poor in sub-Saharan Africa is likely torise still further during the next decade" (World Bank, 1993c).

Table 7 forecasts a 40 per cent increase in the number of absolute poor insub-Saharan Africa, to over 300 million by the year 2000. As chapter IV illustrates,the declining economic fortunes of countries in Latin America and especially those insub-Saharan Africa have resulted in deteriorating housing and environmentalconditions for the urban poor.

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Chapter II. The concept and scale of urban povertyD. Concluding perspective

This chapter have elaborated upon and reviewed the conceptual and statisticalaspects of poverty. Although the incidence of poverty in most parts of thedeveloping world has been falling and indicators of human development areimproving, it has been established that urban poverty remains a formidable problem.Its problematical nature has several aspects. First, and quite obviously, the numberof people living in absolute poverty is enormous, exceeding one billion worldwide.Second, urban poverty is deeply structural, related to the demographic transition andstage of economic development in many developing countries. Having this deepstructural nature, urban poverty requires long-term development policies for itssustainable reduction. In some newly industrialized countries (e.g., Hong Kong, theRepublic of Korea, Singapore and the Chinese Island of Taiwan), sustaineddevelopment over a period of about three decades has led to reduced incidence andvolume of poverty, lesser inequalities and good progress in human developmentindicators. Also, some poorer countries such as Sri Lanka have adopted publicpolicies which have been relatively successful in improving human development.Third, notwithstanding the foregoing, macro-economic fluctuations (and sometimesspecial stabilization and structural adjustment policies), have led to some shorterterm 'cyclical' poverty. It was not until the late 1980s that the World Bank, the IMFand national governments began to appreciate the value of making macro-economicadjustment in favour of the poor and with special safety nets. In the 1970s and 1980sChile had revealed the potential effectiveness of well targeted and reformed socialsafety net programmes. Finally, it has been seen that the idea of 'urban poverty' haslarger meaning and complexity than merely the measurement of income poverty inurban areas. In addition to income poverty, urban poverty includes lack of or limitedaccess to amenities and basic services, and an appreciation that housing poverty hascharacteristics which are additional to income or subsistence poverty.

One aspect which does bind income and housing/urban poverty in closerelationship to each other is the matter of affordability. In housing, affordability canbe understood in analogy to the blades of a pair of scissors. One blade is the level ofincome, and among the urban poor in developing countries this is closely identifiedwith low wage occupations and the intermittent and low earnings in the informalsector. The other blade is represented by the supplies and standards of housingwhich are available. The extensive existence of squatter settlements and crowdedslums in developing countries indicates that housing supplies are inadequate. Thisraises the question as to the effective development of the housing sector as a whole.Affordability is a question of the nexus between housing supplies from the housingsector and income levels from low-wages and informal sector earnings, that is thenature of the intersection point on the analogous pair of scissors. In practical termsaffordability is about rent/price-to-income ratios, occupancy rates, the qualities of

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housing, and security in being able to make medium-term choices in houses. At thepolicy level, the income side of the affordability issue can be improved by the sort ofeconomic growth which is likely to increase the relative and absolute share of incomegoing to the 40 per cent of household with the lowest incomes. The housing povertyside of the affordability issue is a matter of improving the volumes of housing fromthe housing sector. Thus, a policy framework is needed to enhance housingsupplies, and more is said about this below. To summarize: The concept of housingpoverty is useful when — in an increasing number of cities, particularly insub-Saharan Africa — an increasing number of households from the middle-incomegroup are forced to live in informal-sector housing, without security of tenure norproper access to basic services. Although these households may not be classified asliving in income poverty they should be characterized as living in housing poverty,even in the absolute sense of the word.

The affordability issue also involves the scope and quality of utility andinfrastructure services in the urban living areas of the poor. It is a question of accessto piped water, adequate sanitation services, and the reversing of the degradation ofenvironments in urban living areas. In this case, affordability is far more complexthan in our housing analogy of a pair of scissors. Utility and infrastructure servicesconfer both private (individualized) benefits to households and social (collective)benefits to wider communities in the reduction of disease and the improvement ofamenity in living areas. The private and social benefits are inextricably mixed togetherin the provision of services. As delivery systems, the resourcing and financing ofaffordable infrastructure services will often involve co-ordination between publicfinance from government, private finance from households and firms, and self-helpfrom households. In terms of policies, innovations in developing public-privatesector municipal funds and community-based self-help are occupying the attentionof the World Bank and UNCHS (Habitat). Examples of good joint venturedprogress and community-based development occur in Mexico's 'Solidarity'programme. Infrastructure and utility services in neighbourhoods are jointly financedby central and local government, government utility agencies, and organized groupsof households which provide monetary contributions and self-help labour.

In the future, urban poverty issues are increasingly likely to fall withincomprehensive and integrated policy frameworks. This is influenced partly by the'new agenda' developments by the World Bank and UNCHS (Habitat) since themid-1980s. (6) The 'new agenda' gives emphasis to the economic productivitycontributions from the housing and urban sectors (see chapters III and VI). It alsohas its setting in the political economy of 'enablement' and partnerships amonggovernment agencies, private sector firms, CBOs, and households. The ideaunderlying enablement is the mobilization of resources, saving and investment withinlegal, financial and institutional frameworks for housing and urban sectordevelopment. Thus, there are perceived to be greater chances for the reduction ofpoverty in enablement frameworks which enhance urban agglomeration economies,which extend the productivity of the housing sector, and which develop policies

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aimed at improving urban welfare and urban environmental conditions, includingneighbourhood infrastructure services. Or, as it was phrased earlier in this chapter: Itis only by enabling the working poor to help themselves that resources can be madeavailable for direct interventions to assist the poorest group, the destitutes. Ofcourse, as yet, many countries have not fully (or even partially) developed thecomprehensive integrated enablement frameworks envisaged in the new agenda.Nevertheless, such policies are increasingly becoming part of the developmentagenda in a number of developing countries.

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Chapter III. The urban economy

Urban economic change has accelerated since the early 1980s. Urban growthrates have been high in developing countries. Current changes are, however, alsocharacterized by structural economic change in which markets have become morevolatile set in contexts of rapidly changing compositions of demand and supply.City-regions are thus experiencing significant re-allocations of industrial capacity,new patterns of wage and income relativity in labour markets, and more intensivecompetition as locales for production and market power. All of this comes in acontext of increased macro-economic fluctuations among some countries and astrong trend in the international economy towards the deregulation and liberalizationof markets. The change has various social and political consequences. Newinequalities and vulnerabilities are arising in urban labour markets with new patternsof winners and losers. At political levels there are new constraints and opportunities.National governments face constraints in economic policy because internationallycountries face competitive disinflation and economic and political risks if they do notpursue policies for liberalization and enhanced growth. On the other hand,city-regions are able to take their own initiatives to promote the extension of theirindustrial capacity and to enhance their competitive positions. Subsequentdiscussions provide examples of city-regional initiatives for enhancingcompetitiveness.

From the foregoing it is clear that a variety of issues can be derived from theeconomically changing context of city-regions and their human settlements. Theissues can be exhibited from a set of questions. What is there in the economic natureof the urban and housing sectors which can improve overall production, productivityand employment? This question is, of course, especially relevant to developingcountries where economic growth is important in itself and for its potentiality toreduce some aspects of poverty. How do such things as structural-spatial economicchange affect patterns of poverty and inequality? The patterning of poverty andinequality can be referred to at various levels of application. Inequalities andpoverties can occur within specific city-regions; they can occur in the re-ranking ofeconomic and social performance among city-regions; and, as indicated in chapterII, they occur in global regional perspectives, for example, in comparisons betweensub-Saharan African countries and those newly industrializing countries of East Asiaand the Pacific. These questions become relevant themes in what follows in thischapter. Their relevance and significance is raised from some preliminarydiscussions of the nature of modern urban development.

The nature of modern urban development can be ascertained from anunderstanding of the economic role of cities and from post-1985 urban researchstudies. In this, modern urban development will be seen to have a wide diversity ofsignificant characteristics. Urban areas have made substantial contributions to the

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generation of income and employment. During the 19501980 period, however,theories of 'urban bias' and urban over-development suggested that urban areas wereadvantaged by economic policy distortions relative to rural areas. That is not all. Thetheory of urban bias indicates that these policy distortions increased poverty,especially rural poverty among small farmers. But since 1980 economic policies havebeen largely reformed in the direction of market liberalization. Accordingly, as will beseen, there is substantially reduced urban bias, and, on the positive side, there is agrowing appreciation that overall economic development depends upon the qualitiesand efficiencies of urban development. This opens up the question of therelationship between urban agglomeration economies and national and internationaleconomic development. It is a two-way relationship, both from the urban to thewider national and international economies, and from these wider economies to theurban economy. The two-way relationship has dynamic characteristics in a period ofintensive and extensive structural change and with greater international integration ofnational and city-regional economies. All of this has to be explained and brought torelevance, commencing with a review of the role of cities and urban areas.

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Chapter III. The urban economyA. The economic role of cities

The real economic significance of cities was not fully appreciated in the periodfrom the 1960s to the late 1980s owing to the influence of the theory of 'urban bias'(see the discussions below). As reasoned by Peterson and others (1991) newperspectives on urban economic development have become relevant. Citiescontribute some 60 per cent of GDP in developing countries; they are at the heart oftechnological and social change; they absorb labour supplies as a consequence ofrapid economic growth; and, as indicated in the two previous chapters, in the futurethey will be the locale for the growing concentration of poverty owing todemographic change towards urban areas. In an economic regime of liberalizedmarkets, moreover, urban and rural development become mutually supportive. Ruralareas supply cash crops to urban areas; they purchase inputs from the cities; andthey add inter-sector flows of savings for urban capital development. Meanwhileurban areas supply necessary manufactured goods for farming and urbanexpenditures add to rural growth.

In some countries changes in the urban economy have been dramatic since theearly 1980s. Industrial countries have witnessed a recomposition of activities, withincreased employment in service industries and reduced employment inmanufacturing. This has led to a re-allocation of industrial capacity amongcity-regions in a process of continuous structural-spatial adjustment. Change is alsooccurring in the countries transforming from socialism to capitalism, led by priceliberalization and the privatization of capital. This alters patterns of incomedistribution in labour markets and it leads to new geographical patterns of trade andinvestment, consequently affecting the relative growth (and regress) of somecity-regions. The most dramatic changes, however, are occurring in the developingcountries, and this can be illustrated in examples drawn from China and India, thetwo most populous countries in the world.

Faced with a balance of payments crisis and depleted reserves of internationalcurrencies in 19901991, India accelerated its commitment to fundamental economicreform for integration into the international economy. Although India's economicreforms for structural change date only from 1991, as reported by Harris (1994),already some impacts are appearing in city-regions. In Bombay and othermetropolitan centres some manufacturing industries (e.g., textiles) are in relativedecline; other industries are showing signs of development (e.g. engineering andservices), and within several of the major conurbations industrial plants aredecentralizing to the suburbs. More generally in some of India's cities, joint capitalfrom both East Asia and the West is introducing new technology, new productionmethods, and modern management practices in manufacturing. Swissair has locatedits computerized air ticketing in Bombay. This is an example of large internationalfirms unbundling their activities and processes in production and relocating some on

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an international geographical scale. In Falner, Rajasthan, this formerly sleepy townhas sprung to economic life whilst, by contrast, in Mizapur, Uttar Pradesh, thecarpet industry is under competitive pressure from other Asian countries.

In China, examples of significant urban change have occurred in many cities,especially in Guandong province, and the city of Shenzhen, bordering Hong Kong.Structural change in Guandong is often associated with new urban development,occurring on greenfield sites and falling within China's post-1978 'open door'economic policies, aimed at a step-by-step market liberalization. Guandong becamethe location of some of China's special economic zones, with Shenzhen havingstatus as a special economic zone in 1984. Shenzhen grew from a poor city of some320,000 population in 1979 to a city of some 3 million by 1995. In the process ofgrowth Shenzhen's per capita income grew to seven times the national average, asShenzhen became China's showcase of new management practices, decentralizedeconomic decision making and accelerated foreign investment. However, by themid-1990s Shenzhen has begun to experience competitive pressures from othercities in China.

Outside Guandong, Shanghai represents an example of localized initiatives fromcity government to create a planned impetus for long-term economic restructuringover the period from 1990 to 2030. Shanghai was not one of the special economiczones during the 1980s: Instead with the advent of the national governmentdecentralizing economic autonomy to the provinces and cities in the 1990s,Shanghai's leading politicians set their own programmes for reform. They had to dealwith a crumbling infrastructure, a declining industrial base, and a delayed start toeconomic regeneration relative to cities in China's special economic zones. Newprogrammes were introduced, with a focus upon creating a gigantic new industrialestate in Pudong, which is as large in area as Shanghai itself. International financecapital markets were tapped to secure some $710 million per annum in 'constructionbonds'. Additionally new infrastructure is being built and old improved in theShanghai region. Policy-makers are attracting direct investment, partly by offeringstable prices on land leases. Being aware that economic restructuring increasesvulnerability in some sections of the labour market and requires some upgrading ofskills, policy-makers have introduced some basic social security and trainingprogrammes. The economic reforms have genuine impetus, reflected in the attractionof some $3.5 billion in foreign funds to Shanghai in 1992.

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Chapter III. The urban economyB. Urban bias and post-1980 changes

Economic policies have themselves influenced the balance between rural andurban development in developing countries, and also the nature of urbandevelopment. During the 1960s many developing countries had opted formodernization, often via import substitution and protectionism, thereby assuming afavour towards urban economic development. In the 1970s some developmenteconomists (7) , formulated theoretical and political arguments criticizing the inherentbias in protectionist policies. Lipton (1977; 1984) addressed the question as to whypoor people stay poor, and answered it by asserting the cause as 'urban bias'. Theeconomic arguments for urban bias run along the following lines; protectedindustries produce goods and services at higher prices than if they were exposed toforeign competition. Some of these goods are inputs into rural food productionconsequently raising farm costs to higher levels than under international competition.The urban-rural price distortions also mean that rates of increases in prices ofmanufactured goods are greater than they would be under free trade, and greater thanrates of increase in food prices. In other words, the terms of trade between urbanand rural products are policy-biased in favour of the urban formal sector wheremanufactured goods are produced. In addition, protectionist policies often lead toover-valued exchange rates, thus having detrimental effects on potential agriculturalexports. Accordingly income and employment growth in rural areas are restricted. Atthe political level, coalitions of urban employers and workers could also bias thepolitical conditions in their favour.

There are various implications from the theory of urban bias and fromprotectionist policies. First, many bilateral aid agencies became aware of thereasoning and sought to counter some of the bias by favouring development aid forrural areas. This remained relevant until the late 1980s when the economic role ofurban areas was more thoroughly appreciated (see the subsequent discussions).Second, the existence of large volumes of rural-urban migration — along withtheories which sought to explain it, such as the Harris-Todaro model, (8) seemed toreinforce the bias and place development dilemmas on policy-makers. That is to say,it was argued that the protectionist policies induced urban migration, consequentlyadding to the costs and burdens of supplying housing, infrastructure and utilityservices. Third, some countries went further by imposing price controls on ruralproducts, this being adverse to farmers and, at worst, leading to lower supplies offood and dependence upon imported food products. Fourth, the protectionist andagricultural price control policies tended to cut across research findings whichrevealed that in the early stages of modernization agriculture plays a key role inoverall development. For example, various authors (9) indicate that a dynamic andliberated agricultural sector can enhance inter-sector supplies of savings andinvestment to finance the high capital demands of urbanization. Also, the presence of

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a price liberated agricultural sector leads to less economic distortion and to a moreevolutionary and gradualist experience in rural-urban migration.

Although not considered by the authors of urban bias (e.g. Lipton, 1977; 1984),it can be argued that protectionist policies were also adverse to urban as well as ruralpoverty. Once the scope of discussion is broadened to include urban informalsector development various economic and social implications follow, some of whichcountervail the original more restrictive reasoning in the theory of urban bias. Forexample, the wages and incomes of the formal sector increase relative to the informalsector, but the formal sector does not grow sufficiently rapidly to absorb theavailable labour supplies. This arises partly because formal sector prices are 'toohigh' and 'distorted'. In consequence, the formal sector is both protected andconstricted leading to large numbers being pushed into the informal sector whereincome growth is often limited and individual earnings are pressed down by verylarge competitive supplies of labour. With lesser protection in the formal sector andgreater inter-sector competition, then larger flows of urban spending on food wouldhave otherwise increased cash crop production for urban markets. This line ofreasoning in fact extends Lipton's (Lipton, 1977): it is not just that poverty increasesas a rural phenomenon, but rather that it also increases as an urban informal sectoroccurrence.

What happens when the protectionist framework which supports urban bias isdismantled? The question has large significance because programmes for economicstabilization and structural adjustment in the 1980s favoured the liberation of marketsand the reduction in restrictions on imports. In effect the economic reforms will tendto cause the relative prices of food to rise and those of formerly protectedmanufactured goods to fall in some developing countries. Prices and markets will bemore integral with the international economy and its competitive influences. Thereform for openness in trade and price deregulation removes a sub-set of distortionswhich led to urban bias, to unbalanced urban-rural development, and to somedistorted urban economic development. These are but one aspect of economicimpacts upon city-regions under structural change, however, other important aspectsare elaborated in what follows.

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Chapter III. The urban economyC. New directions in urban economic development and policy frameworks

The World Bank's strategic urban policy paper (World Bank, 1991), marked achange of direction. The dominant approach in the 1972 to 1985 period had been infurthering project-by-project approaches (10) . These were variously represented indeveloping countries in sites-and-services schemes, slum upgrading projects, andone-off infrastructure schemes. The change in direction was towards a whole urbansector approach with integral relations to the wider economy. This raised torelevance the relationships between the urban sector on the one hand and thefinancial, fiscal, and 'real' economy linkages on the other. Examples will serve toillustrate the meaning of the change. In finance, the housing sector would growprogressively with the development of housing finance systems: and, ininfrastructure, possibilities would arise in formulating policies to create joint venturemunicipal funds bringing together public and private finance. Fiscal policy linkageswould be exemplified by the development of property taxes in the context of thereform of overall public finance in developing countries. The most importantlinkages were perceived in the 'real' economy. 'Real' economy linkages were seen asparticularly important in the ways urban agglomeration economies could add tomacro-economic growth and often to the alleviation of urban poverty. The WorldBank's strategic policy paper did not comprehensively elaborate the nature andspecifics of changing agglomeration economies in the context of modern structuraleconomic adjustment. However, the subject of structural economic change in citiesand its relationship to agglomeration economies has subsequently been developed bya number of other authors. (11)

This new approach argues that the global integration of city-regions is assignificant as that of nations. The integration is closely associated with changes in thenature of agglomeration economies under structural economic adjustment. It isappropriate to distinguish between 'old' and 'new' agglomeration economies,separated by adaptation to global integration and the locational aspects of structuraleconomic adjustment. Old agglomeration economies have been passive, mainlydependent upon cost-access to inputs and markets. By contrast new agglomerationeconomies are dynamic, having locational significance in city-regional groups ofindustries connected by economically efficient buyer and supplier relationships. Thenew agglomeration economies are more evident in information-based rather thanmaterials-based industries. Information-based industries depend upon innovation andspecialized (localized) networks and skills.

The new agglomeration economies and their characterization of structurallychanging city-regions are more evident in industrial than in developing countries.However, the transition to new agglomeration economies and economic adjustmentis now beginning to influence city-regions in developing countries, including, forexample, manufacturing and services in Bombay (Harris, 1994). The transition has a

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number of important spatial results and characteristics. First, under the earliereconomic regime of import substitution and protectionism the old agglomerationeconomies favoured the growth of primate, very large city-regions. This wasbecause firms would tend to locate in areas where they had secure domesticmarkets. Now, with the advent of economic liberalization, some primate cities willhave reduced dominance as new growth and activities are attracted to smaller citiesin a process of competitive economizing for export-led growth. Second, the leveland quality of infrastructure has importance in city-regional global integration. Inparticular internationalized city-regions require coordinated and effective transportfacilities to move goods by land, sea and air. Inappropriate and inadequateinfrastructure can act as a barrier to international competitiveness. Lesser developedinfrastructure — a widespread feature in developing countries — also means that oldagglomeration economies still characterise most developing countries, especially inmanufacturing.

The foregoing clearly has relevance to human settlements conditions in astructurally adjusting world economy. Industrial capacity is locationally redistributed.Labour markets and relative earnings adjust to international competitive pressures.Economic performance among city-regions is subject to re-ranking and change. It ispossible for local, as opposed to central, leadership to take initiatives to seekdevelopment in the new agglomeration economies (see the earlier discussion oninitiatives in Shanghai). All of this influences affordabilities in housing andinfrastructure in the context of dynamic changes in urban housing markets. Thesedynamic changes will raise some price-access barriers in city-regions with highgrowth rates, affecting the urban poor and other groups. Other aspects are alsorelevant to housing. The modern urban development context is influenced by thespatial dimension having importance in productivity and efficiency. Housing also hasa role to play in productivity, a subject to which we now turn.

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Chapter III. The urban economyD. The productivity of housing

In housing the idea of 'welfare' is normally associated with welfare state roles,with various types of subsidy, and in developing countries, with self-helpapproaches. From an economic perspective housing is variously regarded as a socialexpense of development and as a means of furthering consumption benefits. Theconsumption benefits would include the convenience of useful shelter, the potentialto transform shelter into a 'home', and the means of having current enjoyment. Bycontrast, as an investment housing generates future economic returns and asproduction it is a set of goods and services which generates additions to nationalincome and employment. Recent research by UNCHS (Habitat) and ILO (12) convey acentral message and argument that housing is a production good and that thegeneration of income and employment from housing is a central aspect ofhousing-related welfare. All of this is argued not simply as a technical proposition,but also as an integral part of policy development in the changing political economyof housing. Nonetheless, the argument rests upon a number of technical propositionsabout housing.

The technical propositions are scarcely new: They have been in the housingliterature, dispersed in a fragmented way, since the early 1960s. However, theUNCHS (Habitat) research bring the technical propositions to synthesis andcoherence, and turn them towards particular relevance to developing countries. Howare we to conceive and understand the technical propositions? Consider thespending of 100 rupees or pesos on housing. In the first instance this buys 100worth of resources in the built or improved house. However, within macro-economicprocesses the workers, and other recipients of income will go out and spend someof their incomes received. This will generate further income (via their expenditure)and in housing this will tend in the final result to 'multiply' income by a factor of 2(see section VI.B). A factor of 2 is high in sector comparisons and often in housingit has the advantage that not much is drained away in import content becausehousing tends to use localized resources. But this is not all. The expenditure of the100 worth of resources has 'backward linkages': It can add to production andproductivity in the housing materials and equipment industries. Consequently thisadds further to income and employment generation. There is also some additionalincome and employment generation in 'forward linkages'. Examples of forwardlinkages would include HBEs — workshop activities in housing are especiallysignificant in developing countries — renting out rooms, and expenditure onfurniture and household equipment. In aggregate all of this can be very significant,but would have to be compared with similar processes in other sectors. Housing canbe regarded as 'income'- and 'employment-rich', however, and at the same time, thisdoes not stop at 'the house', it includes major and minor housing-relatedinfrastructure and public works.

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In developing countries poverty is associated with conditions in the informalsector. Low-income housing is identified with squatter settlements andsites-and-services (and relatedin situslum upgrading). The informal sector provides alarge proportion of the employment and construction activities in low-incomehousing. It is organized largely in the form of SSEs. One outcome of this is theprobability that employment is generated to a larger extent in low-income housingthan in high-income housing. The welfare is thus for the SSEs as well as forresidents.

All of this leads to the conclusion that rental values of housing do not expressits full productivity. This is very significant. In standard treatments for measuringinternal rates of return, capital-output ratios and other indicators of productivity it isrental values which are taken as the indicators of output. Consequently in terms ofthe arguments and evidence in the United Nations research, internal rates of return donot take such large amounts of capital to support them as is normally supposed.These arguments receive legitimacy in the fundamental reviews of urban and housingpolicy by the World Bank and UNCHS (Habitat). (13) The World Bank and UNCHS(Habitat) have been developing the productivity argument in urban economicdevelopment and the GSS, aimed at boosting whole housing sector developmentand providing decent shelter for the poor. A welfare-production view of housing canact persuasively for the more general argument that urban economic developmentimproves the wider economic performance of nations.

Further arguments can be added to the UNCHS (Habitat) research, revealingthat the sources of productivity in housing are wider than income and employmentmultipliers. In this we can pursue two lines of argument. First, good standardhousing provides rooms for self-education, study and exercising training skills, all ofwhich are important in the development processes in developing countries. As notedin earlier discussions, structural economic change leads to dynamic change in labourmarkets and in the requirements for skills. Housing has two roles in this. Rentaltenure is important in providing flexibility for changing patterns of employment,including the spatial distribution of employment; and, as noted above, good standardhousing provides study space for acquiring new and necessary skills.

A second production theory of housing has special significance for genderissues and the way we perceive subsidies in housing. As established in the foregoingdiscussion housing is an asset with capital value and it is contributory to theproduction of goods and services. The goods and services include the 'domesticsector', i.e. home-based production of meals, laundering, nurturing of children, andother things. In developing countries in particular, the list would extend tosubsistence products and to home-based economic activities which are associatedwith sales in the informal sector and contracted work for firms. These productsrequire the capital value and resource use of housing and land as well as domesticlabour. Thus 'at-home' production is regarded as being achieved by combining theinputs of domestic labour, domestic capital (i.e. the housing and its equipment) anddomestic sector land. (14)

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This further production view of housing as domestic capital has a number ofimplications; first, much of the exchange and production which occurs 'at home' isnon-monetized and although some of this does not enter into official economicstatistics it nevertheless has economic value. Various aspects of domesticproduction are undervalued, however, and at times not valued at all, and sometimesthey are ignored in economic analysis and policy making. Second, it is to beappreciated that firms do not compensate child rearers (who are mainly women), fortheir costs and labour time in child rearing. Thus, the human capital produced inchild rearing is not compensated. Therefore housing and domestic labour are netcontributors to subsidies rather than net recipients, when viewed from theinter-sector flows of resources from the domestic sector to the wider productioneconomy. The domestic sector provides below-cost human capital to the widereconomy. All of this reveals that the domestic sector and housing have morecomplex and controversial relationships to the wider economy than is normallysupposed. This has implications for housing policy and for the political economy ofwomen's roles. It heightens the relevance of the argument that housing involvesproduction as well as consumption, consequently raising its importance indevelopment, and, "it implies that shelter provision is not only a goal, but moreimportantly, it is a tool of development policy" (UNCHS/ILO, 1995).

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Chapter III. The urban economyE. Conclusions

It has been seen that structural-spatial change in city-regions is a process ofcreation and destruction, i.e. creating new winners and losers. In its phase from theearly 1980s to the mid 1990s it has led to increasing inequality within city-regions,also some increased inequality among city-regions, and some opportunities for localleadership to enhance localized agglomeration economies. (15) This adds further to thecharacteristics of the economic adjustment and poverty issues which were identifiedand discussed in chapter II. In these earlier discussions it was revealed that policiesmake a difference to outcomes. On the one hand, growth-orientated policies can addto the long-run security of vulnerable social groups and the general community. Onthe other hand, economic reform sometimes mediates austerity packages asshort-term trade-offs for longer term improvements. As indicated in the example ofChile it is possible to formulate policies which are designed effectively for targetingand providing social safety nets for the poor. Such policies may be increasinglynecessary in a period of structural-spatial change: the change affects patterns ofincome distribution in labour markets, leading to increasing inequalities in somecity-regions, along with vulnerability to underemployment among some groups.

In this context it is relevant to ask the question as to the scope and direction ofurban policy? This question has received the attention of the World Bank (1991) and UNDP (1991). The World Bank and the UNDP favour a 'new agenda', specifying aframework of 'enablement'. Enablement frameworks are aimed at whole sectordevelopment, drawing together government agencies, firms, NGOs and communitiesin the pursuit of economic productivity and welfare. This recognizes that it is neitherfeasible nor desirable for the state to be the sole provider of economic enhancementand social security against destitution and the contingencies of life. Other agenciessuch as firms, households, and CBOs have important roles. Nevertheless the statehas important roles in creating reformed institutional frameworks, in creating andprotecting property rights, in attending to the changing dynamics of poverty, and insometimes dealing with the inadequacies of the market. The 'new agenda' hasrelevance and significance in these issues. It addresses such issues as urban poverty,environmental degradation, decentralization (economic, administrative and political),public participation, and seeks to bring economic vitality to cities. As discussed inthis chapter, urban agglomeration economies and housing sector economicproductivity can add to the economic vitality of city-regions. Under conditions ofenablement the economic and wellbeing components of urbanization would belargely embedded in the social and economic organization of city-regions.

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Chapter IV. Recent trends in the human settlements conditions of the world'surban poor

This chapter outlines the human settlements conditions of the world's urbanpoor. As the vast majority of those living in absolute poverty are located in thedeveloping countries (see chapter II), the discussion in this chapter is restricted tothe regions of Latin America and the Caribbean; sub-Saharan Africa; North Africaand the Middle East; South Asia; India; East Asia and the Pacific; and China. Thechapter includes a discussion on the growth of human settlements; the nature andextent of urban poverty; housing and environmental conditions; the provision ofinfrastructure; and the difficulties of access to land.

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A. Latin America and the Caribbean1. Urbanization and the growth of human settlements

One of the most distinctive characteristics of Latin America, compared with theother regions of the developing world, is its high level of urbanization. As can beseen from table 13 , nearly three quarters of the region's population is currently livingin urban areas. More than half of the region's urban population (55 per cent) can befound in the two countries of Brazil and Mexico. Both of these countries have morethan three quarters of their population living in urban areas. A country like Venezuela,with an urban population of 93 per cent, has one of the highest levels of urbanizationin the world. There are, however, a few countries where the level of urbanization isstill relatively low, like Haiti (32 per cent) and Guatemala (42 per cent). Among thecountries of South America, Ecuador and Bolivia have the lowest levels ofurbanization with 58 per cent and 61 per cent respectively.

The rates of urban population growth in the region are relatively modest, as canbe seen in table 14 . The current (19952005) growth rate of the region as a whole is2.2 per cent per year. It is highest among the Central American countries 2.5 percent, and lowest among the countries of the Caribbean. The countries with thelowest level of urbanization are the ones with the highest urban growth rates. BothHaiti and Guatemala are currently experiencing urban growth rates of more than 4 percent per year, while the rates in Ecuador and Bolivia exceed 3 per cent. The lowestgrowth rates among the countries listed can be found in Cuba (1.1 per cent),Argentina (1.4 per cent) and Chile (1.5 per cent).

As table 14 indicates, urban growth rates will remain relatively high throughoutthe first quarter of the next century. The rates are, however, projected to decline toan annual average of 1.3 per cent during the 20152025 period. By the year 2025, 85per cent of the region's population will be living in urban areas. All the majorcountries of the region will by then have predominantly urban populations.Furthermore, the urban population of the region is expected to grow from about 360million in 1995 to 600 million in 2025. The largest increase, in absolute terms, isexpected in Brazil where the urban population is projected to grow from 127 millionin 1995 to 205 million in 2025. In relative terms, however, the largest growth isprojected to occur in Guatemala and Haiti, where the population of urban areas willmore than triple during the next three decades.

Although the urban growth rate is relatively modest compared with otherregions of the world the absolute growth is staggering. Each remaining year of thiscentury the region will experience an urban population increase of 8.7 million. Thishappens at a time when the rural population is actually contracting. In fact, amongthe thirteen countries listed in tables 13 and 14 , only five will experience rural

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population increase during the 19952000 period.

Another distinctive feature of urbanization in Latin America is the number ofvery large cities. By 1995, there are seven cities in the region with a population ofmore than four million people (see table 15 ), and an additional thirty-five cities witha population of between one and four million. United Nations projections indicatethat by 2015, a total of thirteen cities in the region will have populations in excess offour million. Compared to the other regions of the developing world, however, thecurrent growth rates of major cities are relatively low. Only one of the cities listedcurrently have an annual growth rate of more than 2.5 per cent. The growth rates ofthe largest cities are actually lower than urban growth rates. The table also indicatesthat the growth rates have declined considerably since the 19651975 period, whenmost of the largest cities had annual growth rates in excess of four per cent. Duringthe 19851995 period, average annual growth rates were still in excess of 2 per cent inmost of the large cities. There are, however, some exceptions. Mexico City, BuenosAires and Rio de Janeiro all had annual growth rates of less than 1 per cent duringthe last decade. Projections for the next two decades indicate that the growth ratesof the largest cities will continue to decline.

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A. Latin America and the Caribbean2. The nature and extent of urban poverty

The growth of urbanization, coupled with the severity of the recession and theeffects of the macro-economic adjustment policies which have been appliedthroughout Latin America have resulted in serious consequences in terms of urbanpoverty. In Brazil, Guedes and Devecchi (1994) argue that "the economic crisis hasincreased the gap between rich and poor. Recent census figures show that the toptenth of the population controls nearly half the nation's wealth, and the bottom 10 percent owns less than 1 per cent". They estimate that 65 per cent of the totalpopulation of 150 million is now living below the poverty line.

Tello (1990 — quoted in Gilbert, 1994), describes a similar situation in Mexico,where between 1982 and 1989, "Per capita GDP fell 14 per cent, and the decline inearnings was very unevenly distributed. While the country's population expandedfrom 71.4 million in 1981 to 81.2 million in 1987, the country's poor grew from 32.1to 41.3 million". In Argentina, which until the 1980s had enjoyed the highest percapita GNP in the region, the effects of the 1980s were much the same:"The traditional high average qualified labour force has broken down. In the lastdecade there was a strong reduction of workplaces in the modern industrial sector,the wages in the public sector decreasing to at least a third of the historicalaverage. More recently the acceleration of the privatisation process has demandedflexibility of the traditional labour legislation. All that has meant increasingunder-employment, unemployment and exploitation" (Fernandez-Wagner, 1994).

The impact of these measures has particularly affected the major cities.Coulomb (1994), referring to Mexico City, acknowledges the fact that adjustmentpolicies have reduced the inflation rate to less than 10 per cent, have cut the budgetdeficit and registered a positive net balance of capital flow. The price, however, hasbeen paid by labour:"The Minimum Salary has lost over half its purchasing power in 10 years;unemployment or under-employment (disguised under the term 'informal sector')involves over half the population in Mexico; drastic cuts in public spending,particularly in the social budget, have reduced indirect salaries by over 40 percent in just eight years. In terms of income, half of Mexico City's populationcurrently lives below the 'poverty line'; when measured in terms of the satisfactionof basic needs, poverty affects two-thirds of the city's inhabitants".

Pasternak-Taschner (1994), makes a similar claim in respect of São Paulo inBrazil, "Adding up the houses in squatter settlements, slums, and the illegaldevelopments in the periphery, approximately 65 per cent of the real city was illegal".Guedes and Devecchi (1994), claim that the result of these processes in Brazilian

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cities is that, "human development has been abandoned to a daily individual strugglefor survival".

In Colombia, Kellett and Garnham (1994), refer to an official study conductedon the basis of the most recent census in 1985 that "13.3 million people (45 per centof the population) were in situations of poverty and of these 7.4 million wereclassified as living in absolute poverty". They also quote two more recent studiesgiving contradictory views as to whether the circumstances of the poor areimproving or not. A more recent official study, conducted in 1991, claims that 22per cent of the population was living in "conditions of poverty", whilst a secondstudy (Molina, 1991) calculates that "44 per cent of the urban households of thecountry earn less than 2.9 times the minimal monthly wage and half of them, or 22per cent, live in such poverty, that their incomes are less than 0.87 of the minimalwage".

The World Bank has undertaken a number of its poverty assessment exercisesin Latin America. In Venezuela (with about 90 per cent of its population living inurban areas), poverty was seen to be primarily an urban phenomenon.Three-quarters of the poor were urban dwellers and approximately 50 per cent ofurban dwellers were deemed to be poor (World Bank, 1993c). Of particular concernto the Bank were, "the desperate conditions of the majority of residents in thesquatter settlements that surround the major cities" (World Bank, 1993c). Povertywas found to be strongly correlated with illiteracy, low educational attainment, poorhealth and malnutrition, and amongst female-headed households, where one third ofthose living in extreme poverty in urban areas were headed by women. Poorhouseholds were also larger with a higher dependency ratio than non-poorhouseholds.

In Chile, the World Bank's assessment of poverty — using subsistencemeasures — identified up to 45 per cent of the population living below thepoverty-line (World Bank, 1993c). Poor households were characterized by anaverage household size of 5 persons (compared to the national average of 4.25); theywere relatively young, with almost half the members under 15 years of age; a thirdcontained at least three young children and more than half one child under five.Nuclear families predominated and female-headed households, especially in urbanareas, were particularly vulnerable to poverty.

Whilst the incidence of poverty in Ecuador was higher in rural than in urbanareas, approximately 46 per cent of urban households were classified as living belowthe poverty line, 16 per cent of whom were considered to be "absolutely poor"(World Bank, 1993c). The low-income group included disproportionately largenumbers of the indigenous Indian population and female-headed households. Thepoorest workers in the urban context were street vendors, craftsmen and domesticworkers. Ecuador had made considerable progress during the oil boom of the 1970sin improving living standards and ameliorating the circumstances of the poor. Thesegains, however, were partially lost by the economic crisis of the 1980s, by declining

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oil prices, a major earthquake and other climatic shocks.

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A. Latin America and the Caribbean3. Housing and environmental conditions

The impact of these adverse economic changes on the housing sector in LatinAmerica has been dramatic. Some countries, most notably Argentina and Uruguayhad sophisticated housing markets with established institutional structures and arelatively mature construction industry (Fernandez-Wagner, 1994). These formalmarkets have been devastated by the economic consequences of the 1980s. At thesame time many countries were pursuing 'interventionist' policies in the housingmarket either by direct housing provision or the provision of housing loans, usuallythrough a State housing bank. Whilst these interventions rarely benefitted the urbanpoor in a direct way, they often benefitted the low-income groups, if only partially.The most notable example is the role of the National Housing Bank of Brazil.Between 1964 and 1986 the Bank funded the construction of 4.8 million units, aquarter of which were for popular housing targeted towards low-income groups(Pasternak-Taschner, 1994). An increasing number of defaulters (estimated at 50 percent of borrowers in 1984), resulted in the bankruptcy of the Bank in 1986 with anestimated deficit equal to 6 per cent of GDP (Pasternak-Taschner, 1994). Thecollapse of the Bank and subsequent legislation devolving increasing legal andfinancial autonomy to State and municipal governments has led to a situation wherethe Federal Government of Brazil has effectively withdrawn from housing marketintervention. The Brazilian Housing Bank was not the only government housing bankaffected in this way. Following high inflation and the withholding of repayments as apolitical gesture, the Uruguayan Mortgage Bank experienced considerable difficultiesin the late 1980s. It has now modified its role and status (Garcia Miranda, 1994). TheNational Mortgage Bank in Argentina was de-commissioned in 1990(Fernandez-Wagner, 1994), following similar financial difficulties.

Whilst the economic changes of the 1980s have seriously undermined some ofthe more formal markets and financial institutions, the impact on housing andenvironmental conditions has been equally serious. The backlog of housing need isgrowing in every country. In Brazil the housing deficit was recently estimated at 12million dwellings (Fridman, 1994), whilst about 60 million Brazilians (approximately40 per cent of the population), live in unsatisfactory housing (Bolay, 1994). InMexico, the shelter deficit (which includes families without shelter as well as those ininadequate housing conditions), was estimated to be 6.1 million units in 1990 (UNCHS, 1993e). Fernandez-Wagner (1994) observes a deteriorating housingsituation in Argentina between 1980 and 1984 as recorded by official estimates, andalthough statistical evidence is not readily available, he assumes an even greaterincrease in the deficit since then. In Colombia, the deficit was assessed at 525,000units in 1990 (Kellett and Garnham, 1994); and in Bolivia, it increased from 267,000in 1985 to 364,000 units in 1992 (Richmond, 1994).

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The current housing shortage is further aggravated by evidence of adeterioration of housing and environmental conditions. Thus in Argentina,Fernandez-Wagner notes that the quality of completed dwelling units fell between1970 and 1980, so that approximately half the units completed in that year wereeither 'precarious' or 'deficient' in some form. He estimates the proportion of thesetypes of informal dwellings to have increased during the 1980s. Similarly, in Bolivia,according to Richmond (1994), the estimate of homes in need of improvement andbasic services almost doubled between 1986 and 1992, from 556,000 units to1,087,000; and in Colombia, 1.7 million households, or a third of the entirepopulation, were officially regarded as living in substandard housing, defined interms of space, absence of infrastructure or poor quality of construction in 1991(Kellett and Garnham, 1994).

The deterioration of housing conditions may also be expressed in terms of theincreasing significance of the informal sector as a proportion of the housing stock.Table 16 shows the growth of squatter settlements as a proportion of the populationin a selected number of Latin American cities. This trend towards an increasingproportion of squatter settlements in the major cities, with marked social segregationbetween rich and poor, is a widespread phenomenon throughout Latin America.

While the housing shortage may seem enormous the future increase inhouseholds numbers makes the housing problem truly staggering. The householdgrowth rate of the region is nearly twice that of population growth (see table 5 ). Thereason for this is the rapid decrease in household size. The number of households inthe region is projected to increase with some 15 million during the 19952000 period,i.e. an increase of 15 per cent. The challenge is further aggravated by the fact thatnearly the entire increase will occur in urban areas. If this household growth istranslated into housing demand the challenge ahead for the urban areas of thecountries of Latin America and the Caribbean is truly staggering.

In fact the increase in the number of households in Brazil alone during the 19952000 period amounts to some eight million, equivalent to about two thirds of thecurrent housing deficit. Although the case of Brazil is exceptional, with its relativelysmall households (3.5 persons compared to 4.3 persons for the region as a whole),similar figures apply to the other countries of the region as well. In Mexico, a total of1.8 million new households are created during the 19952000 period. Similar figuresfor Colombia, Argentina, Peru and Venezuela are 0.8 million, 0.8 million, 0.5 millionand 0.6 million respectively (UNCHS, 1996).

This brief outline of the impact of recession on the operation of housingmarkets in Latin America and the subsequent deterioration of housing conditionsprovides little prospect of improved circumstances for the urban poor. Someauthors have argued that the economic shocks of the 1980s, combined with theadvocacy of an enabling role through the GSS, are encouraging nationalgovernments to abrogate their responsibilities for providing help with shelter for theurban poor. As far as Mexico is concerned, for example, Coulomb (1994) states,

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"Nowadays, the key word in National Housing Programme policies is the normative,administrative and fiscal 'deregulation' of housing production, financing andmarketing, including those for low-income housing. The 'modernization' of publicorganizations responsible for low-income housing consists of relieving them of anyinvolvement at the level of the conception or production of projects and convertingthem into mere credit institutions. The Government of Mexico declares thatlow-income housing planning is no longer its domain, that the supervision ofconstruction should be privatized and that its new role as 'facilitator' specificallyconsists of permitting the free play of market forces".

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A. Latin America and the Caribbean4. Other infrastructural provision

As one might expect in the light of the above discussion there is little evidenceof an improvement in the provision of infrastructure, especially for the urban poor.Bolay (1994), quoting the most recent data from Peru, reveals that only 46 per centof urban dwellings are equipped with sanitary installations and only 17.5 per cent arelegally provided with electricity. In Bolivia, according to the 1992 census, between30 per cent and 40 per cent of the housing stock lacks access to the basic servicesof water, sanitation and drainage (Richmond, 1994). This picture is, by now, afamiliar one with growing numbers living in informal settlements which, because oftheir illegality, are not supplied with basic services. Such figures, however, do notconvey the insanitary and dangerous circumstances in which many people live. InSão Paulo, for instance:"Six million people live in precarious housing conditions: many families have beenforced to move out from the formal rental market to slums or tenement houses andthe so-called informal city represents almost 60 per cent of the total population ...one million people survive in squatter settlements along streams, creeks, andslopes; sanitary conditions are inadequate for the majority; drinking water isbecoming ... more scarce and expensive. Sewage is partially treated (30 per cent)and the two main rivers that cross(es) the central part of the city are mainly (usedfor) waste disposal; (and) the large number of irregular settlements along streamsand slopes, has created an ever-increasing number of disaster-prone areas"(Guedes and Devecchi, 1994).

Moreover, where one finds widespread poverty and inequality, desperation,crime and violence, are often not far away (see box 3 ).

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A. Latin America and the Caribbean5. Land availability

The increased emphasis on market forces has also led to growing landspeculation and to increasing land prices in major Latin American cities. In a detailedstudy of the dynamics of urban land markets in major Brazilian cities, Fridman hasargued that with declining returns on financial investments, the higher income groupsseized upon the faltering real estate market and prior to the collapse of the housingfinance system they switched investment into commercial real estate developmentssuch as high rise shopping and commercial complexes and up-market residentialdevelopments in central city locations. In 1984, over 20 per cent of totalconstruction activity in São Paulo was in luxury real estate developments (Fridman,1994).

Whilst the trend in São Paulo preceded other cities, luxury real-estatedevelopments became commonplace in the latter half of the 1980s, land prices beganto increase and competition for land became acute. Thus land prices, andsubsequently rents, were increasing at a time when the incomes of the middle- andlow-income groups were falling and the result was a flight of population from theinner-city areas to the periphery and an enhancement of illegal settlements. Thisintra-urban movement has characterized most major Brazilian cities during thisperiod.

Whilst this particular conjuncture of events was confined to Brazilian cities, thephenomenon of increasing land costs was not, and has led to a situation where theurban poor are unable to afford even the most modest plot. Coulomb comments onthe situation in Mexico:"Given the current costs of land and materials in Mexico City, only householdswith an income of over three times the minimum salary can afford low incomehousing. This means that over 80 per cent of all households have no alternativebut the unauthorized occupation of land without services and self-construction ofmake-shift housing" (Coulomb, 1994).

The problem may not be one of absolute lack, though. UNCHS (Habitat) hasearlier identified the unavailability rather than lack of land as a specific obstacle to aneffective housing supply: "Most cities in Mexico, in particular those of medium sizeand the newly developed cities, are characterized by their low population density anda large number of vacant plots, mostly held by speculators" (UNCHS, 1993e).

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A. Latin America and the Caribbean6. Summary

Latin America has a large proportion of its population in cities, particularly inlarge cities. Whilst the rate of urbanization has slowed during the 1980s, decliningpublic expenditure and the changing role of national governments has meant awithdrawal from interventionist polices. As yet, however, there is little evidence thatalternative policies have been able to make any positive contribution to the particularcircumstances of the urban poor. In the meantime, the numbers of the urban poorare increasing, their housing and environmental conditions are deteriorating, and theirprospects for an improvement in their shelter circumstances appear to bediminishing.

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B. Sub-Saharan Africa1. Urbanization and the growth of human settlements

Table 17 gives a clear indication of the rapid increase in urbanization takingplace within sub-Saharan Africa. The table shows that the level of urbanization ismodest by global standards. In overall terms the urban population of sub-SaharanAfrica has nearly tripled between 1975 and 1995 from 74 to 184 million, while thelevel of urbanization has increased from 21 to 31 per cent. The countries with thelargest urban populations are Nigeria (44 million), South Africa (21 million) and Zaire(13 million). The countries with the highest level of urbanization in the region (amongthose listed in tables 17 and 18 ) are South Africa (48 per cent); Cameroon (45 percent); Côte d'Ivoire (44 per cent), Zambia (43 per cent) and Nigeria (40 per cent).The least urbanized countries are Rwanda (6 per cent), Uganda (13 per cent),Ethiopia (13 per cent), Malawi (14 per cent) and Niger (17 per cent).

Because of the limited urban base, however, some of the countries experienceamong the fastest rates of urbanization in the world. The most rapidly urbanizingcountries in the region include Burkina Faso, with a projected annual average rate ofurban population growth of 8.3 per cent between 1995 and 2000; Mozambique, 6.4per cent; Niger, 5.9 per cent; Madagascar and the United Republic of Tanzania, 5.7per cent; and Kenya, 5.6 per cent. As can be seen from table 18 , not one singleamong the countries listed have annual urban growth rates of less than 3 per cent peryear. In fact, among the countries listed only two have growth rates of less than 4per cent per year.

The rapid urban growth is projected to continue well into the next century. Sixof the countries listed will in fact have higher average annual urban growth rates forthe 20052015 period than for the 19952005 period, while only nine countries areprojected to have an average growth rate of less than 4 per cent per year during the20152025 period. These continued high growth rates imply that the absolute growthbecomes truly staggering. The average annual urban growth rates for the region isprojected to increase from 11.0 million per year during the 19952005 period to 20.8million per year for the 20152025 period.

Nigeria's urban population is expected to grow with some 2.6 million each yearbetween 1995 and 2005. This figure is expected to reach 4.2 million per year duringthe 20152025 period. In Ethiopia and Zaire — the two most populous countries ofthe region after Nigeria — urban population growth rates are still increasing, with theresult that the current (19952005) annual urban population increase with some511,000 and 741,000, will triple to 1.6 million and 1.9 million respectively, during the20152025 period.

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The current urban population explosion occurs at a time when rural populationsare growing with similar numbers. Yet, while urban population growth is increasingrural population growth is stagnating or decreasing. In fact, the annual urbanpopulation increase in absolute terms during the 19952000 period is higher than therural increase in 15 of the 23 countries listed.

Within some of these countries the capital cities function as primate cities andare experiencing similarly high average annual rates of population growth. Thus, theannual population growth rate for Maputo (Mozambique) is 6.3 per cent; for Nairobi(Kenya), 5.3 per cent; Lagos (Nigeria) 5.2 per cent, Luanda (Angola) 5.1. per cent,and Abidjan (Côte d'Ivoire), 4.7 per cent (see table 19 ). These are amongst thefastest growing cities in the world, and as the table illustrates, the growth is expectedto remain at high levels during the next two decades. The projected growth of Lagosis truly striking. Its current populations of 10.3 million is projected to increase withnearly 150 per cent, to 24.4 million during the next two decades. All other citieslisted, apart from Cape Town, are projected to more than double their populationsbetween 1995 and 2015.

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B. Sub-Saharan Africa2. The nature and extent of urban poverty

White summarizes the factors influencing urbanization in Africa as follows: "(1)population growth and the rural exodus; (2) the drought; (3) the price of petroleum... ; (4) the slowdown of the global economy; (5) the adverse trend in the terms oftrade for exporters of primary goods; (6) domestic policies which favour the urbandweller over the rural dweller" (Stren and White, 1989). Almost without exceptionthese factors have had an adverse effect on the economies of the countries ofsub-Saharan Africa. Even the more robust economies have tended to falter in termsof economic growth. In South Africa, for example,"The past three decades have seen a consistently declining rate of growth — froman average of 5.56.0 per cent during the sixties, to 1.9 per cent during theseventies and less than 1 per cent during the eighties. This is further exacerbatedwhen the high population growth rate is taken into account — in short, per capitaincome in real terms is declining and national savings are at an all time low.When equity is considered this is still further exacerbated. South Africa has one ofthe worst income distributions in the world. In 1988, the top 10 per cent received48 per cent of income while the lower 50 per cent received only 11 per cent of theincome" (Kruger and Davies, 1994).

In Kenya, a similar situation emerges, but for different reasons. Kenya's annualrate of economic growth declined from 8.2 per cent in 1977 to 0.4 per cent in 1992.The factors accounting for the rapid decline in the 1990s were "political uncertaintysince the advent of multi-party politics in 1990 ... the sharp depreciation of theKenya Shilling, whose exchange rate to the US$ stood at Ksh 18.5 in 1988 but fell toKsh 65 by 1992. Inflation rates also galloped from 5.6 per cent in 1986 to 27.5 percent in 1993. To compound all this, a foreign exchange crisis resulted from an aidembargo instituted by the IMF and the World Bank in October 1991"(Gatabaki-Kamau, 1994). The consequences of these political and economicdifficulties at the household level have meant increased unemployment and a rapidfall in the value of wages. Unemployment in 1993 was 20 per cent compared with15.9 per cent in 1985 and between 1981 and 1991 real wages fell by 31 per cent.Moreover, high inflation rates meant that between 1990 and 1992, low-incomehouseholds, which constituted almost 60 per cent of Nairobi's population, had toabsorb a 40 per cent increase in food prices (Gatabaki-Kamau, 1994). Similarevidence of increasing urban poverty is suggested by the growing evidence of childmalnutrition in Nairobi: "28 per cent of children under three were malnourished in a1972 squatter settlement, in 1980 an estimated 50 per cent of children in Kibera (anunauthorized settlement in Nairobi) were malnourished, while in 1987, 4060 per centof children under five in Nairobi were experiencing malnutrition" (Ndombi, 1988 —quoted by Amis, 1990). These political and economic difficulties are continuing in

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Kenya where a number of international donors have suspended aid in 1995.

In order to restructure national economies to withstand the adverse effects ofpolitical and economic changes, the IMF and World Bank have obliged manyAfrican countries to embark upon SAPs. It is often difficult to distinguish betweenthe effects of SAPs and other factors impacting on the economy, but in broad termsthe effects of economic restructuring have enhanced economic growth but at thecost of diminishing living standards, most markedly amongst the urban poor. Ghanaadopted an SAP in 1983 and whilst supporters maintain that the programme hasrestored economic growth (3 per cent per annum over 10 years), and had a positiveimpact on public sector accountability and forward planning, Korboe points out that:"Per capita GNP remains no more than US$400, terms of trade are reported tohave declined by some 25 percentage points between 1987 and 1990, and theaverage debt service ratio for the period 19861990 was a high 42.7 per cent.Poverty remains rife overall: approximately 45 per cent of the population livebelow the notional 'poverty line', and average calorie and protein intake both fallshort of levels recommended by the World Health Organization [WHO]" (Korboe,1994).

In Zimbabwe, the government pursued stabilization policies through the 1980sand only adopted a fully fledged SAP in 1991. Implementation of the measurescoincided with a severe drought making it difficult to disentangle the effects of onefrom the other. However:"in 1991, GDP grew 4.9 per cent in real terms, but in 1992 it fell by 7.7 per cent.The balance of payments was adversely affected by the loss of agricultural andagriculture related exports and the need for food and water- related imports, whilethe government failed to reduce its budget because of the need for drought relief.... Inflation became more rapid, as a result of increased prices of importsfollowing devaluation, decontrol of prices, etc. It increased from an average of13.2 per cent per annum between 1980 and 1990 to 42.1 per cent in 1992 and21.6 per cent in the first six months of 1993" (Rakodi, forthcoming).

Furthermore, job losses were substantial and unemployment increased to anestimated 40 per cent in 1993, while the cost of living more than doubled between1990 and June 1993 (Rakodi, forthcoming).

These examples serve to illustrate the adverse impact of political and economicchanges during the 1980s on some of the stronger economies of sub-Saharan Africa.At the other end of the economic spectrum is Mozambique which after years of civilwar is one of the poorest countries in the world with a per capita GNP of just $90(World Bank, 1995a). In its poverty assessment of Mozambique the World Bankconcluded that poverty was pervasive and that around two-thirds of the populationlived in absolute poverty. Poverty in urban areas was estimated to be between 30 and50 per cent of the population and in peri-urban areas slightly higher at 4060 per cent.

But while per capita incomes continue to fall in most countries of sub-Saharan

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Africa and urban poverty is widespread and increasing, there is little systematicevidence to measure its extent. Instead commentators tend to refer to the proportionof the population living in informal settlements as a surrogate indicator. Figure 6illustrates the point. It demonstrates that in each of the cities illustrated the informalsector is larger than the formal sector. Neither are these examples exceptional. Tothese may be added Nigeria, where between 70 and 80 per cent of the urban housingstock is estimated to be in the informal sector (Achunine, 1993; Oruwari, 1994);Uganda, where a National Household Budget survey carried out in 1989/1990estimated 89 per cent of the population as "low-income earners" (Kitunka 1993); andalso in South Africa where approximately 8 million households are currentlyestimated to live in illegal shack settlements in and around urban areas (Oelofse andPikholz, 1994).

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B. Sub-Saharan Africa3. Housing and environmental conditions

The rapidity of urbanization in the sub-Saharan countries has generallyoutstripped the capacity of urban institutions to cope with it. In terms of shelterprovision there is an urban housing backlog in every country experiencing rapidurbanization and this backlog steadily increases as the demand for shelter continuesto outstrip supply. In Nigeria the shortage of urban housing is estimated at more thanone million units, with about a quarter of the shortfall occurring in Lagos (Achunine,1993).

One should be cautious of direct comparisons, but estimates are even higher inSouth Africa, where the Housing White Paper (Government of South Africa, 1994),estimates an urban housing backlog of 1.5 million units; in Kenya, the figure was280,000 in 1987 (Mbogua, 1994); in Zambia, in 1988, it was estimated at 208,500units (Boakye, 1994); and in Ghana 375,000 units in 1993 (Derkyi, 1994).

When the projections for urban population growth are taken into consideration,the awesome nature of the task of providing adequate accommodation for allbecomes fully apparent. Nigeria's National Housing Policy, published in 1992,identifies a requirement for 700,000 housing units per annum in order to meet shelterneeds by 2000. About half of these are needed in urban areas (Egunjobi, 1994).Despite these formidable requirements it seems that the policy of the Government ofNigeria has changed since the most recent military coup. Rather than continue withthe enabling strategy embodied in the National Housing Policy, the Government hasreverted to a policy favouring direct shelter construction by the public sector. (16)

A number of projections have been made to calculate the required level ofurban housing provision in South Africa by the year 2000. These range widely, butestimates fall broadly between 2.3 and 3.4 million units, resulting in an averageprogramme of almost 275,000 units per annum (Kruger and Davies, 1994).According to the Housing White Paper (Government of South Africa, 1994), 39 percent of urban housing is 'informal' (about 1.5 million units); 5.2 per cent ofhouseholds live in hostels and 13.5 per cent of households live in squattersettlements, either on the periphery of urban settlements or interspersed within urbanareas. There is also an enormous shortfall in the provision of amenities; 25 per centof urban households do not have access to piped water, 48 per cent do not haveaccess to flush, or ventilated pit latrines, whilst 46 per cent are not linked to theelectricity supply grid.

Estimates for other countries also illustrate the enormous gap which currentlyexists between need and supply. In Kenya it is estimated that 60,000 units are

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required in urban areas per year compared with a current rate of development ofabout 20,000 (Mbogua, 1994). In Ghana, Derkyi sets housing need per annum at90,000, whilst supply amounts to 7,500 (Derkyi, 1994).

Yet, housing demand is not going to decline. Each year for the rest of thiscentury the number of households in sub-Saharan Africa will increase with some 2.8million (see figure 4 ). In Nigeria, where two thirds of current population growthoccurs in urban areas some 1.5 million households will be added during the 19952000 period. During the first decade of the next century this figure will increase tosome 3.7 million, and projections for the 20102025 period indicate a further increaseto some 5.4 million new households per year. An increasing majority of these newhouseholds will appear in urban areas.

Yet, the rate of increase in the number of households in the region is onlyslightly higher than that of the population, as the average household size remainshigh. The fact that sub-Saharan Africa remains, together with South Asia, the regionof the world with the highest average household size has direct implications forhousing demand. The units required in this region, with an average household size of6.0 persons in 1995, is qualitatively different from the ones demanded in LatinAmerica and the Caribbean where the average household size is 4.3 persons perhousehold. This difference is likely to be strengthened over the next three decadeswhen the average household size in sub-Saharan Africa is projected to decline onlyslightly to 5.6 persons per household as compared to 3.3 persons in Latin Americaand the Caribbean (see table 5 ). In fact, in several of the countries of the regionaverage household sizes are projected to increase over the next three decades. InNigeria, for example the average household size is expected to increase from 7.3 to8.1 persons between 1995 and 2025. Likewise, in Côte d'Ivoire (from 6.9 to 8.1persons per household), Ghana (from 5.8 to 6.4) and South Africa (from 5.4 to 5.6)(UNCHS, 1996).

Many observers have pointed out that formal housing provision is beyond themeans of the urban poor, but in current circumstances, with housing and land costsincreasing, and incomes diminishing in purchasing power, the affordability gap iswidening rather than closing. Korboe states that by the end of 1990, the most basicshelter built to satisfy municipal standards in Ghana cost the equivalent of twelvetimes the annual minimum wage. He compares this with the formal real estateprovision of "modestly fitted two bedroom houses" which were selling in late 1993for 76 times the annual minimum wage. Further evidence of the growing disparity isprovided in a rare comparative study of housing costs and standards in Nigeria.Oruwari's study, conducted in Port Harcourt, compares rent levels for differentforms of accommodation between 1980 and 1992. Her study demonstrates thatwhilst rent levels for flats and houses in the formal sector have increaseddramatically, the rents for rooming houses increased at much lower rates. Over thesame period by comparing current construction costs and reasonable rates of return,Oruwari then shows that whilst it remains economical to build 2 and 3 bedroom flatsthis is no longer the case for rooming houses (Oruwari, 1994). She claims that only 3

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per cent of housing built in Port Harcourt between 1980 and 1992 was intended forlow-income consumption.

Whilst the prospect of affordable housing becomes less likely for most Africanhouseholds, let alone the urban poor, there is also evidence of a deterioration in theirhousing conditions as far as occupancy rates and overcrowding are concerned.Oruwari's study shows that considerably more households in Port Harcourt wereoccupying one room in 1992 (82 per cent) than in 1970 (52 per cent) and theoccupancy rate was higher (3.8 persons in 1992 compared with 2.4 in 1970). Thesefigures confirm a national study undertaken in 1991/1992 which revealed that 87 percent of urban households in Nigeria lived in single rooms (Awatona, 1994). Similarfindings are available from a study in Accra (Songsore, 1992). According to thestudy, 46.3 per cent of all households were occupying a single room and the averageoccupancy rate per room was 2.9 persons. For the low-income population thisfigure rose to 4.4 persons per room. Songsore suggests that the groups mostaffected by poverty in Ghana are, "redeployed workers, the unemployed, and thoseself-employed or casually employed in the informal sector."

Sometimes the increasing pressure on shelter may be reflected in less obviousways. In comparing occupancy per room in the informal settlements of Nairobi, forexample, Amis noted the absence of children during the late 1980s and argues that"the fostering of children of the urban poor with their rural kin is a relatively commonstrategy to combat the high cost of urban living. It is therefore possible to explain theaverage declining number of persons per room observed in Nairobi in the 1980s asan increase in single persons sharing and a decline in the number of children" (Amis,1990).

In Uganda the quality of the housing stock in urban areas is very poor:"... 44 per cent of houses in Kampala and 31 per cent of houses in other urbanareas require replacement, whilst 36 per cent for Kampala and 61 per cent of thestock in other urban areas can be upgraded. Good housing stock in Kampala is amere 20 per cent and the percentage is much lower for other urban areas,dropping to 8 per cent. Seventy five per cent of residential building structures inKampala are low-cost, semi-permanent, ... in other urban areas the percentage ofpoor building structures is much higher amounting to 90 per cent" (Kitunka,1993).

Whilst there remains a dearth of comparative information on shelter conditionsin many of the countries of sub-Saharan Africa, the picture which emerges is one inwhich the majority of urban houses are built in informal or squatter settlements whichare rapidly increasing in density. Upgrading programmes have enabled a fortunateminority to benefit from potable water supplies, electricity and communal sanitation,but for the most part these settlements have very limited access to basic services.

The case of the SAP in Uganda illustrates the effects of the economic recessionon the housing sector (see box 4 ).

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B. Sub-Saharan Africa4. Other infrastructural provision

Mbogua argues that urban services are deteriorating in many sub-SaharanAfrican cities: "The majority of the urban dwellers especially those living in squattersettlements have no access to basic services like: sanitation, potable water, wastedisposal, health and educational services" (Mbogua, 1994). The reasons for this, hecites, are, "limited financial resources, poor management at local and centralgovernment level ... rural urban migration and high unemployment ...." As a resultcity management has become inefficient, which further contributes to inadequateinfrastructural provision and environmental problems, and he fears this will result inwhat he describes as a 'squatter culture' amongst the urban poor.

Overall comparative statistical information is not available but evidence tosupport Mbogua's contention of declining urban services and a deteriorating urbanenvironment may be obtained by reference to conditions in two major sub-SaharanAfrican cities, Nairobi and Accra. Gatabaki-Kamau (1994) analyses the politicallysensitive issue of solid waste disposal in Nairobi. She estimates that while thepopulation of the city grew by approximately half a million people between 1979 and1989, its capacity for solid waste disposal (in terms of the operational capacity ofheavy duty vehicles), declined by about a third. This implies that by mid-1993 theNairobi City Council was able to collect only about 40 per cent of the total amountof domestic refuse being generated in the city. The City's policy has been to resortto privatization and the encouragement of community participation to supplement itsown endeavours, but this has resulted in a service which is inadequately supervised,liable to corruption and where "neither ... [the Nairobi City Council] ... nor theprivate operators are showing a keen interest in garbage collection in poor housingareas" (Gatabaki-Kamau, 1994).

In a systematic study of Accra, Songsore (1992) draws on a variety of sourcesto illustrate the nature of infrastructural provision and other basic services in the city. Table 20 shows the distribution of various types of water supplies in the city. It maybe seen that less than half the population enjoy a piped water supply to their houses.In slum areas and other low-income neighbourhoods Songsore reports that facilitiessuch as public or private standpipes, wells (with or without a pump), and watervendors are the main sources of supply. He estimates that daily per capitaconsumption in such areas is about 60 litres per day, about a quarter of therecommended level, and the reasons for this are, low system efficiency and the lackof capacity of the Ghana Sewage and Water Company to expand provision to meetthe growing requirements of the city.

As far as sanitation is concerned, provision is even worse. Table 20 also shows

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the types of toilet facilities available to households in Accra. These figuresdemonstrate a rudimentary level of sanitation in most parts of the city. According toSongsore, the most common form of 'other' facility is 'open defecation'. After adeteriorating service throughout the early 1980s, the reorganization of the service wasundertaken with the assistance of overseas aid in 1986. These changes have resultedin a 'stabilization' of the sanitation arrangements in the city.

Solid waste disposal, however, remains as "one of the most intractableproblems within the Accra Metropolitan Area" (Songsore, 1992). Only about 10 percent of the population of the city have their refuse collected whilst unauthorizeddumping is widespread in low-income areas.

Songsore concludes that the inadequate provision of these basic servicescoupled with poverty, illiteracy and a lack of health care contributes to high rates "ofenvironment-related, water-borne and water washed diseases" in the Greater AccraRegion. Whilst area-based data for the prevalence of disease does not exist, heargues that the incidence is expected to be much higher in low-incomeneighbourhoods.

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B. Sub-Saharan Africa5. Land availability

The informal provision of much urban housing in sub-Saharan Africa highlightsthe issue of the availability of urban land to a greater extent than other factors ofproduction. Moreover, the availability of land for urban development in manyAfrican countries is complicated by the fact that customary land law survivesalongside more recent statutory law and is often communal or familial in terms ofrights to use and ownership and non-transferable under any circumstances. It oftenprecludes the ownership of land by women and is a major obstacle in enablingwomen-headed households to secure satisfactory accommodation (Molapo, 1994).For some time statutory land law in many sub-Saharan African countries reflectedthe influence of former colonial powers, but on gaining independence manycountries have introduced major land reforms. The nature of these land reforms hasvaried, and in some countries it has been to nationalize the development rights toland effectively (e.g. United Republic of Tanzania, Zambia and recently also inNigeria). More generally, however, the trend has been "to assign to the State a widerauthority as an agency for improving social standards and the life of the community"(Boakye, 1994).

There is little evidence that any of the sub-Saharan countries experiencing rapidurbanization is able to deal effectively with the demands placed upon land supply,but those countries which have centralized decision-making over the ownership anduse of land have been no more successful in delivering land for development by theurban poor than other countries. In a study of land allotment in Dar-es-Salaambetween 1978 and 1992, for example, Kombe discovered that only 6.8 per cent of allapplicants were successful (Kombe, 1994). He found that many of those who weresuccessful, however, had been supported in their applications by influentialpoliticians or party officials and concluded that most of the available plots wereallotted to those with social, political or economic power. Mbogua (1994) claims thatland allocation in Kenya "has acquired an extra quality. It is a consideration in anelaborate patronage system which empowers those in authority to buy loyalty fromsupporters". His fears are confirmed in a study by Olima (1994) who found in astudy of landowners in two Kenyan towns, that only 15.7 per cent of thoseinterviewed had secured their land through government or local authority leases, therest had obtained their land-holding through 'informal' channels.

It would be misleading to suggest that such political influence in land allocationis confined to those countries having exercised central control over land. On thecontrary, political patronage and corrupt practices in dealing with land arewidespread in many countries of sub-Saharan Africa (17) . In addition to malpracticeof one sort or another there appears to be a host of other factors which result in

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inefficiencies in the land delivery process, especially for the urban poor. Theseinclude a lack of a clear planning framework for urban land use; weak municipalcapacity and procedures for dealing with land acquisition, surveying, servicing,registration and allocation; fragmented tenurial systems resulting in conflicts betweencustomary tenure and proprietorial rights under the 'new' statutory systems; and lackof financial resources for positive interventionist policies and compensationpayments, etc. These kinds of inefficiencies in the face of rapid urbanization haveinevitably led to a shortage of land for development and in turn, shortages haveresulted in increasing land prices and also to the emergence of a black market orinformal system of land supply. Examples of rapidly increasing land prices abound.In Dar-es-Salaam, for example, Kombe (1994) shows that land prices in informalareas more than doubled between 1988 and 1992. Similar increases were recordedby Nuwagaba (1994) between 1989 and 1991 in various parts of Kampala. Macoloo(1994) also confirms that land prices have been steadily increasing in Kenyan townssince the late 1960s, but in a more detailed study of two low-incomeneighbourhoods in Kisumu, he notes that land prices have increased substantiallyduring the latter part of the 1980s. These land price increases appear to reflect atrend in many major urban areas in sub-Saharan Africa and in all cases the effect isto push the possibility of land ownership further beyond the reach of the majority ofurban dwellers.

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B. Sub-Saharan Africa6. Summary

The countries of sub-Saharan Africa are undergoing rapid urbanization during aperiod when their share of global trade is diminishing and macro-economic policiesare forging structural changes in domestic economies. There is substantial evidenceof falling incomes in the face of rapidly rising costs and growing urbanimpoverishment. The impact of these changes on the shelter sector is to diminish thecapacity of government to intervene in the urban housing market, but at the sametime to render market circumstances to be so adverse in terms of rising land costs,materials costs and the costs of borrowing, that there is a restricted market for theprivate sector which is confined to a relatively small proportion of affluent orinfluential people. Meanwhile, whilst the number of urban poor is increasing theirhousing standards appear to be deteriorating for want of investment and as a resultof increasing densities. The affordability gap between the incomes of the poor andthe cost of modest accommodation appears to be growing rather than diminishing.

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C. North Africa and the Middle East1. Urbanization and the growth of human settlements

Next to Latin America and the Caribbean, North Africa and the Middle East isthe most urbanized among the regions of the developing world. As table 21indicates, nearly 60 per cent of the population is currently living in urban areas. Thetable also shows that the Middle East subregion is more urbanized than North Africa(65 per cent and 50 per cent respectively). Turkey and the Islamic Republic of Iranhad the largest urban populations in 1995 (43 million and 40 million respectively).The highest levels of urbanization (among the countries listed) can, however, befound in Saudi Arabia (80 per cent) and Iraq (75 per cent). The least urbanized ofthe countries in the region is Yemen, with only a third of its population in urbanareas. All the countries are experiencing high urban population growth rates. Table22 reveals that all countries listed have annual growth rates (19952000) in excess of2.5 per cent. The rate of urbanization is generally higher among the countries of theMiddle East, where all countries listed have growth rates in excess of 3 per cent. Interms of absolute numbers, the largest population increase occurs in Turkey and theIslamic Republic of Iran where urban populations are projected to increase withmore than 1.5 million people each year between 1995 and 2000.

Table 22 also indicates that the growth rates are declining in all countries of theregion apart from Egypt. The region's average annual urban growth rate has declinedfrom 5.1 per cent during 19551965 to 4.0 per cent during 19851995. Future growthis expected to decrease even further. During the next ten years growth is expected toaverage 3.3 per cent, while the rate will decline to 2.2 per cent during the 20152025period.

In absolute terms, however, the urban population of the region will continue itsrapid growth. During the next decade (19952005) an average of 7.8 million peoplewill be added to the urban population of the region each year. This figure isprojected to grow to 9.0 million per year during the 20152025 decade. This urbangrowth occurs at a time when rural growth is dwindling. In fact, the rural populationin Turkey is actually contracting with nearly half a million persons each year duringthe 19952000 period. Urban growth currently accounts for nearly 90 per cent of thetotal population growth of the region. By 2015 the rural population of the region as awhole will start contracting. Ten years later, by 2025, three quarters of the regionspopulation will be living in urban areas (see table 21 ). By this time the urbanpopulation of the Islamic Republic of Iran is projected to reach 92 million, while sixother countries will have urban populations in excess of 25 million people (comparedto only three today).

As table 23 indicates, all but one of the largest cities of the region are growing

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at rates of more than 2 per cent per year. Teheran and Damascus are the only majorcities of the region where growth is expected to accelerate during the next twodecades. Yet, all major cities of the region are expected to remain with relatively highgrowth rates for the next two decades. The three largest cities of the region, Cairo,Istanbul and Teheran are projected to experience population increases of between 50and 60 per cent over the next two decades, reaching populations of 14.5 million,12.3 million and 10.2 million respectively by the year 2015.

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C. North Africa and the Middle East2. The nature and extent of urban poverty

Clearly, circumstances in Iran and Iraq are exceptional after a prolonged periodof warfare, but as far as the other countries are concerned, generally they have higherlevels of per capita GDP than most countries in South Asia and sub-Saharan Africaand the incidence of urban poverty is less marked. Nonetheless, and despite a morediversified economy, the oil price increases of the 1970s precipitated a prolongedrecession into the 1980s in Turkey. As a consequence of stabilization policiesintroduced by the military administration in 1981 and continued by subsequentgovernments, there was a marked fall in real wages between 1978 and 1986. Duringthis time the wage index of state employees fell from 144.4 to 64.9 and that forworkers associated with the Social Security Organization from 110.7 to 52.5 over thesame period (Turel, 1991).

A recently undertaken poverty assessment in Egypt found that 2025 per cent ofEgyptian households could be classified as poor (World Bank, 1993c). It furtherrevealed that, despite progressive educational policies, illiteracy remainedwidespread, especially in the case of women (62 per cent compared with 38 per centamongst men). Whilst most of the poorest were found in rural areas, the urban poorincluded those in industrial employment and services, and especially those in thelowest ranks of government. They comprised between 25 per cent and 33 per centof young people, a large proportion of women, especially widows andfemale-headed households, and the elderly. The report concluded that, "the plight ofthe poor has been worsening in the face of a rapid population expansion, adeteriorating economy and mounting pressures on public resources".

Similar problems of rapid urbanization and faltering economic activity alsocharacterize the other North African countries of Algeria, Morocco and Tunisia, andper capita GDP in these countries has grown marginally over the decade to 1992,with the exception of Algeria which has actually fallen by 0.5 per cent (World Bank,1994a).

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C. North Africa and the Middle East3. Housing and environmental conditions

Housing and environmental conditions are closely related to economicperformance. Worsened economic circumstances in these countries have thus led toa similar worsening of housing and environmental standards, especially for thelow-income groups. In Turkey the economic crisis of 1979/1980 saw a sharpreduction in housing investment as a proportion of GNP and a fall in the proportionof housing investment of total fixed capital investment (see table 24 ). After arelatively consistent increase in housing production from the first planning period in1963 to over 100,000 units in the late 1970s, housing starts plummeted and outputfigures slumped during the Fourth Five Year Plan period (19791983). The number ofhousing starts during this period was only 940,000, i.e. only 55 per cent of the targetof 1.7 million (Ergun, 1991).

The economic crisis was a watershed in postwar housing policy in Turkey.Thereafter the government has channelled unprecedented levels of investment intohousing through centrally controlled credit arrangements to encourage thedevelopment of mass housing projects through non-profit-making cooperatives.Whilst this has been successful in increasing housing output, to well over 250,000units in 1992 (Gür, 1994 and see table 25 ), it has been less successful in improvingthe circumstances of the poor. Özüekren argues that there are four reasons for this,"First, the loans provided by the [Mass Housing] Fund cover only 30 per cent of theconstruction cost, and the low-income groups are not able to complement the loanavailable to make up the total cost of construction. Second, it encourages largerrather than smaller, cheaper dwelling units, which in itself addresses the housingneeds of the richer rather than the poorer families. Third, it provides loans to thosewho may already have satisfied their basic needs. Fourth, it permits profits to bemade with scarce national resources" (Özüekren, 1991).

Throughout the post-war period, therefore, formal housing provision in Turkeyhas not only fallen consistently short of housing needs, it has also not generally beendirected towards the needs of the poorest groups. This has contributed to aninexorable growth in squatter settlements, especially in urban areas. Table 26 showsthat by 1990 approximately one-third of the urban population in Turkey was living insquatter settlements and that the squatter population had almost tripled in the twodecades since 1970.

The problem is most marked in the major cities, such as Ankara, Istanbul andIsmir, and table 26 demonstrates the extent of squatter settlements in Ankara.According to Aksoylu (1994), "such uncontrolled settlements are generally erected ininconvenient and inaccessible localities on the urban fringe. The task of providing

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public services to the unorganized and sprawling settlements is highly expensive forcity governments. As a general rule, the quality of the dwellings is inadequate andelectricity, running water, drainage and sewerage and gas are unavailable or are invery limited supply". In the Sixth Five Year Plan (19901994), there was someevidence that the Government of Turkey was seeking to respond to criticisms that itshousing programmes were neglecting the needs of the urban poor. The Planintroduced subsidies for low-cost housing construction targeted towardslow-income groups; municipalities were given powers to encourage the productionof housing for rent for low-income groups; and sites-and-services programmes wereintroduced in order to prevent the further growth of squatter areas in the major cities(Aksoylu, 1994; Gurel and others, 1994).

A lack of affordability of government provided conventional mass-housingschemes alongside rapid growth of informal settlements characterizes the countriesof North Africa as well. In Egypt, urban development is concentrated along thebanks of the Nile and its delta. Approximately 45 per cent of the population live on 4per cent of the land area. In a situation where public and private sector housinginvestment has declined over the last two decades (Rizk and Rabie, 1991a), theurban population has increased by some 60 per cent. The result is that the acutepressure for accommodation has not been matched by a corresponding increase inappropriate urban housing and services. The effects of rent control have also had anadverse impact on the quality of the older housing stock and at least 30 per cent ofthe urban housing stock is rapidly deteriorating. An estimated 12,000 units are losteach year through structural failure (Rizk and Rabie, 1991a). The lack of provisionof low-cost accommodation has resulted in the growth of informal settlements on theurban fringe and a recent estimate by the Ministry of Local Administration assumedthe total population of these irregular urban settlements to be about 7 million people(25 per cent of the estimated urban population in 1995), in just under 1,000 areaswith an average density of about 50,000 inhabitants per km² (El Batran and others,1995). In Ismailia these informal settlements are growing at an annual rate of 12.5 percent as compared with a rate of 3.7 per cent per annum for the city as a whole (ElBatran, 1994).

Most of the inhabitants of these irregular settlements are immigrants from ruralareas and they are characterized by "great poverty, unemployment [a] low level ofhuman skills [a] rising rate of disease, besides a low educational level and spreadingilliteracy, especially in girls and women" (El Batran and others, 1995).

Since 1977, the Government of Egypt has embarked on a number of integratedupgrading and 'sites-and-services' projects in the major cities in order to formulate amodel strategy for dealing with these irregular settlements. For strategic reasons,however, it has also initiated a number of 'new towns' and these have not only beenintended to relieve pressures on the major cities, but also to alleviate the nationalhousing shortage. Rizk and Rabie (1991b) argue, however, that the new towns havenot managed to sustain a housing supply consistent with the original targets. Theyfurther argue that the provision of accommodation in the form of conventional

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multi-storey flats has been inappropriate for the low-income groups, and that asubstantial proportion of these new-town residents belong to the low-incomegroups, and cannot afford to purchase the newly-built flats. As a consequence manynewly built flats remain unoccupied. El Batran and others (1995) suggest that in 1986as many as 1.8 million newly constructed housing units remained unoccupied inEgyptian cities, despite the acute shortage of low-cost accommodation. This majorcontradiction, of an excessive demand for low-income housing and a superfluity ofmore expensive accommodation is still apparent in urban areas throughout Egypt.

In Algeria, Ikhlef (1994) argues that, "The housing shortage .. is one of themost sensitive problems facing the country today". Following independence in 1962,the government embarked upon a national programme primarily to develop theeconomy. The provision of housing was only given increased attention during the1970s, when a Ministry of Housing and Town Planning was created (1977).Confronted with a huge backlog of housing need and increasing shelter deficits, thegovernment adopted an approach intended to produce mass housing through theindustrialization and standardization of building products using Western Europeansystem-built technology. This approach has not been successful; "in reality, the[system-built techniques], proved expensive, difficult to manage and failed toachieve numbers on the one hand, and produced a type of housing alien to mostAlgerians on the other" (Hadjri, 1991). Neither have these newly built units beenaffordable by the urban poor and — as in Turkey and other developing countries inthe region — illegal settlements have continued to grow. Despite a reassessment ofthis strategy during the mid 1980s and a reorientation in favour of self-help housingand the promotion of cooperatives using more indigenous materials, a deteriorationin the economy has meant a substantial reduction in the output of social housing. In1990, the official housing deficit was estimated at about 1.5 million dwellings withhousing need increasing at about 130,000 per year (Hadjri, 1991). The current outputof social housing does not exceed "a few thousands per year", is not allocated to thevery poor and their only solution is to continue to reside in unsafe and insanitary,illegal urban settlements (Hadjri, 1991).

Morocco has also experienced rapid growth in its major urban settlements withthe consequential growth of shanty towns and illegal settlements. The provision ofnew social housing has primarily benefitted urban middle-income groups. Thegovernment has, however, also pursued the upgrading and resettlement of those inshanty towns and in the more recent illegal settlements. Problems with cost recovery,land acquisition costs as well as the complex nature of the institutional frameworkfor upgrading, has rendered slow progress in these areas (Ameur, 1995).

As projections indicate that the average household size in the region will declinefrom 5.6 persons in 1995 to 4.7 in 2025 the rate of increase in the number ofhouseholds is considerably higher than the growth of population. During the 19952000 period the number of households is expected to increase with some ninemillion (UNCHS, 1996). The number of households in Egypt will increase by some100,000 each year for the rest of this century. The figures for Turkey, the Islamic

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Republic of Iran and Algeria are 76,000; 52,000 and 25,000 respectively (UNCHS,1996). Given the relative size of the urban population growth, the bulk of this growthin the number of households is likely to occur in urban areas. The challenge ahead interms of housing supply in the urban areas of North Africa and the Middle East isthus truly staggering.

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C. North Africa and the Middle East4. Land availability

As in other developing countries, rapid urbanization places great demands onthe supply of land and increasing demand generates an increase in the price of land.The liberalization of economic policies, coupled with the encouragement ofprivatization has tended to encourage the commodification of land and thedevelopment of urban land markets. In Egypt, for example, the introduction of itsOpen Door Economic Policy in the 1970s saw an influx of foreign investment,particularly from the Arab States. This influx precipitated a sudden increase in theprice of inner-city real estate and subsequently resulted in increased pricesthroughout urban areas. The increasing value of land attracted speculators, who, inthe absence of strong public sector institutional capacity for the planning andmanagement of urban land, have become increasingly influential in urbandevelopment decision-making. At the same time the impact of rising pricesthroughout the urban land market has created considerable difficulties for the urbanpoor. El Batran describes how urban upgrading programmes in parts of Ismailiahave contributed to increasing rents 1215 times. In addition to this increase comesthe requirement for 'key money' (El Batran, 1994). The continuing high demand forurban land is resulting in escalating land prices in Egyptian cities, thus forcing thepoor into even more peripheral locations (El Batran and others, 1995).

A similar situation has occurred in Turkey, where 'intermediaries' haveestablished themselves in promoting illegal subdivisions of public owned land insquatter areas. Attempts by the government to preempt such developments throughthe establishment of a Land Office to provide a supply of low-cost land for housingdevelopment have been unsuccessful. The main reason for this is "weak organizationand scarce resources" (Özüekren, 1991). More recently, however, the Governmentof Turkey has sought to compete with thedallal(speculative land agents), through anexperimental approach by providing "Temporary Habitation Centres" to act asreception areas for low-income groups who will then benefit from relocation intosites-and-service projects. This current stratagem for urban squatter settlements hasemerged as a result of the successful absorption of successive waves of immigrantsexpelled from central European countries since the 1950s (Gurel and others, 1994).

Escalating land costs and a shortage of land for low-cost shelter provision arealso major problems confronting the urban poor in the countries of North Africa.

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C. North Africa and the Middle East5. Summary

Influenced very much by their neighbours in Western Europe, the countries ofNorth Africa and the Middle East have embarked upon post-war housing strategieswhich have seen governments involved directly in the provision of formal 'socialhousing'. In each of these countries, however, this accommodation has failed tomeet expectations in terms of numbers, and sometimes also in terms of quality. Theallocation of such accommodation has also favoured middle-, rather thanlow-income groups, with the result that migrants to the cities have had to resort toinformal or squatter settlements. In the light of economic recession, the difficultiesencountered in undertaking these new house-construction programmes, and rapidlygrowing informal settlements, in recent years these governments have increasinglyresorted to 'enabling' roles and self-help strategies for the urban poor in line with thepolicies advocated by UNCHS (Habitat) and other international agencies.

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D. South Asia1. Urbanization and the growth of human settlements

South Asia is one of the most densely populated regions of the world. Thethree countries of India, Pakistan and Bangladesh have a total population of almost1.2 billion people in 1995. Because of the sheer size of its population — some 935million in 1995, which amounts to one sixth of the world's population — India willbe discussed in a separate section.

South Asia is, together with sub-Saharan Africa, the least urbanized region ofthe world. As can be seen from table 27 , only a quarter of the region's population iscurrently living in urban areas. Nearly 60 per cent of the current urban population ofthe region is living in Pakistan. Pakistan is also the most urbanized of the countries,with more than a third of its population in urban areas. By contrast, less than a fifthof the population of Bangladesh, and less than one seventh of the population ofNepal, is living in urban areas.

Urban population growth in the region is, however, relatively high. The urbanpopulations of Pakistan and Sri Lanka have increased by 150 per cent between 1975and 1995, while the urban population of Bangladesh has more than tripled. The rateof urban growth for the region as a whole is currently (19952005 period) 4.9 per centper year (see table 28 ), and it has actually increased over the last three decades. Thehighest growth rates for the next decade is projected to occur in Nepal andAfghanistan, where urban populations will grow at about 6.6 per cent per year. SriLanka is projected to have the lowest growth rate. The growth rates are projected toremain high over the next three decades, and the urban population of the region isthus expected to increase with some 240 per cent to reach 284 million in 2025.

The absolute growth of the rural population in the region is still higher than thatof the urban areas. This is, however, changing fast. During the first quarter of thenext century urban populations are expected to increase three and a half times as fastas the rural populations (United Nations, 1994). By the year 2025, 48 per cent of thepopulation is projected to live in urban areas. By that time, 57 per cent of thepopulation of Pakistan is expected to live in urban areas. In all the other countries,however, urban populations are expected to form a minority (see table 27 ).

Each year during the 19952005 period, the urban population of Pakistan isprojected to increase with 2.8 million. For Bangladesh the figure is projected to be1.4 million, compared to 360,000 in Afghanistan, 257,000 in Nepal and 145,000 inSri Lanka. The urban population of the region is expected to reach 105 million by2000. Some 61 million of these will be living in the urban areas of Pakistan, whileanother 29 million will be living in Bangladesh. Among the countries listed, Sri Lanka

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is the odd case, with annual growth rates of less than 2 per cent during the last twodecades. Yet, urban growth in Sri Lanka is projected to accelerate, reaching anaverage of 3.6 per cent per year during the 20052015 period.

All the major cities of the region are currently increasing their populations ataverage annual rates in excess of 4 per cent (see table 29 ). This growth is onlyparalleled by the growth rates in sub-Saharan Africa. A city like Dacca, for example,has had an average annual growth rate of 5.9 per cent during the 19851995 period.Although this growth rate is declining, it is still expected to remain at 5.2 per centduring the next ten years. As can be seen from the table rates are projected to remainhigh. The six cities listed will have growth rates in excess of 3.5 per cent also duringthe 20052015 period. The result is that the three largest cities of the region: Karachi,Dacca and Lahore will reach populations of 20.7 million, 19.0 million and 10.8million respectively by the year 2015.

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D. South Asia2. The nature and extent of urban poverty

According to Qureshi and Bhatti (1991), "35 to 40 per cent of Pakistan'spopulation may be considered as poor", i.e., those below the 40th percentile of theper capita income distribution. Those below the 90th percentile may be regarded as'very poor'. Quoting a recent survey of patterns of consumption, they suggest that22 per cent of households are unable to obtain a minimum diet of 2,0002,500calories per day and that 60 per cent of all children under the age of 5 years have"some kind of nutritional deficiency". About 30 per cent of babies are bornunderweight (less than 2.5 kilograms) and 28 per cent of mothers consume less than70 per cent of the recommended calorie intake during pregnancy. Infant and maternalmortality is higher in thekatchi abadis(slum settlements), where safe water andsanitation facilities are 'grossly inadequate', compared to other areas (Qureshi andBhatti, 1991).

In Bangladesh, with a per capita GDP of $220 in 1992, an estimated 56 per centof the urban population was living below the poverty line in 1986 (Ahmed and Rouf,1991). Life expectancy is amongst the lowest in South Asia. Men have a lifeexpectancy of 53 years and women of 50. Infant mortality is also extremely high at110 per 1000 live births, and malnutrition is the principal cause of death amongstchildren under five, but adults, and particularly women, also suffer from it. The childmortality rate is 188 per 1000 and the maternal mortality rate is between 6 and 8 per1000 (Government of the Netherlands, 1992). Moreover, projections by the Centrefor Urban Studies in Dhaka indicate an alarming growth in the numbers in urbanpoverty by the year 2000 (see table 30 ). (18) The table indicates a similar picture tothat in South East Asia, which shows that whilst the proportion of the population inpoverty is decreasing, the rate of urbanization is so fast that the actual numbers ofthe urban poor are increasing as the urban economy is unable to absorb such largenumbers.

Official statistics from Sri Lanka suggest that the numbers in poverty haveremained relatively stable over two decades, falling from 3.5 million persons in theearly 1970s to 3.3 million persons in the late 1980s. Within this group thoseconsidered to be 'ultra poor' have declined from 5.5 per cent in 1980/1981 to 3.0 percent in 1985/1986 (Dickson, 1991). Assuming a poverty line threshold of Rps. 700,34.6 per cent of the urban population (or 1.5 million people) were living in poverty in1991.

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D. South Asia3. Housing and environmental conditions

According to the National Housing Policy (Government of Pakistan, 1992),there is a substantial shortage of housing units in the country, especially for the urbanpoor. Each successive Five Year Plan has failed to meet its housing targets and in1992 it was estimated the overall shortfall was 6.25 million units. The NationalHousing Policy acknowledged that if current rates of urbanization continue there willbe an increase in the growth of slums,katchi abadisand encroachments on private aswell as public land. Table 31 shows the number ofkatchi abadis, as recorded in theSeventh Five Year Plan (19881993), and estimates the residential population of thosesettlements to have been about 6 million in 1988.

Malik argues that, by the early 1990s, approximately 3540 per cent of thepopulation of the major cities of Karachi and Lahore were living in these slumsettlements, and that, if present trends continue, 50 per cent of the urban populationmight be living in such conditions by the year 2000 (Malik, 1992; 1994).

A survey of housing conditions in a sample ofkatchi abadisin Lahore in 1988undertaken by Zaidi (1990) gives an indication of the quality of life in such areas. Asmany as 82 per cent of the households living in these slum settlements had beenliving there for more than 10 years. The average length stay was 18 years. Averagehousehold size, at 8.3 persons, was higher than that for the city as a whole (7.0persons), and an increasing proportion of households were nuclear, rather than jointfamilies. There was a high dependency ratio (4.6) with only 1.8 persons perhousehold earning any income, and those earnings were at the bottom end of theincome spectrum.

Over a period of five years there had been an increase in the proportion ofpucca(permanent) structures from 24 per cent to 41 per cent and a reduction ofkutchadwellings (from 19 per cent to 13 per cent), but most residential structuresremained semi-permanent. Improvements to the structures had been undertaken asthe sites were regularized by the Lahore Development Authority. A total of 89 percent of the superstructures were owned by the occupiers, but renting had increasedas the slum settlements had had tenure rights conferred. Densities were high, 78 percent of structures having plot sizes of less than 100 square yards. Sub-divisionswere increasing and so too was overcrowding, as the average number of rooms perunit was only two.

Whilst housing conditions for the urban poor are deteriorating in Pakistan, theproblem appears to be even worse in Bangladesh. Overall statistics on housing andenvironmental conditions are elusive but Islam (1992), confirms that "more than 50

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per cent of the urban population are found in the category of the poor" and inDhaka, the largest metropolitan city, the proportion "can be as high as 70 per cent".In a study of access to residential land by the urban poor in Dhaka he identifies sixclassifications of the low-income group according to residential status (see table 32).

The first group are 'squatters', which also include pavement dwellers and thehomeless. These are the poorest of the poor, their residential structures are the mostrudimentary and are devoid of basic services. They are invariably illegal, and onmarginal sites. Densities are extremely high of 1,5002,500 persons per acre and thenumbers are growing. Most shacks are owned by the occupants, but some aresub-let to tenants.

The second group are those who have been relocated into rehabilitation orresettlement camps. These sites are often peripheral, and despite occupancy forperiods of up to 30 years, tenure remains insecure, as they were intended astemporary relocations, sometimes for immigrant communities. Shelter andenvironmental conditions in such camps are 'extremely poor'. Islam estimates thatsuch camps accommodate about 6 per cent of the Dhaka's population.

The largest groups of poor people live in thebustees(slum settlements).Residential structures arekutchaor semi-puccaand whilst conditions are superior tothe squatter settlements, they remain quite deplorable. Approximately two-thirds ofthebusteesare on privately owned land and are run as commercial enterprises bybusteeowners or 'slum-lords'. Islam estimates that whilst 40 per cent of the city'soverall population may live in thesebustees, approximately seven-eighths of these willbe renters.

The fourth group are those living in old, conventional tenemental structures ininner city areas. Private owner occupancy co-exists with rented units, but owing tolow rents and a high intensity of use the structures become run down anddilapidated. Islam estimates that approximately 13 per cent of the city's populationresides in these areas.

Employee housing for low-income groups provides a further classification.This may be provided by the government or private-sector organizations andaccounts for a further 7 per cent of the population.

Finally, other accommodation for low-income groups may include lodgings orshared housing with middle-class families, or in shops, factories or other institutions.This form of accommodation has proved particularly popular amongst single youngwomen on a shared basis and Islam estimates that no less than 50,000 women havefound accommodation in the city in this way.

The outcome of these market processes is that some 70 per cent of thepopulation in the city are living in conditions where "all basic physical and utilityservices necessary for health are either absent or in extremely short supply" (Islam,

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1992). Moreover, the pressure for accommodation, however marginal, is increasingboth as a result of natural growth and in-migration and leads Islam to conclude thatby the end of the century, when the population of Dhaka is expected to reach 10million, 80 per cent of those may be living in the circumstances described above.

In contrast to Bangladesh, housing has been given a very high priority ineconomic as well as political terms in recent years in Sri Lanka. Since 1978, thegovernment has initiated three major housing programmes: The Hundred ThousandHousing Programme, 19781983; the One Million Housing Programme, 19841989;and the 1.5 Million Housing Programme, 19901994. In spite of the achievements ofthese programmes in raising housing standards as a whole, it is the urban poor whoface "the most serious housing problem in Sri Lanka" (Fernando, 1994). Accordingto Fernando "more than half of the population of Colombo Municipality area todaylive in slums and shanties", and "a similar situation of bad housing is foundthroughout the urban sector". The major problem is that the shanties are constructedon publicly owned land and on marginal sites liable to flooding and do not enjoy a'legalized' status from the perspective of the provision of basic public services suchas water, electricity and sanitation. Whilst the housing programmes have beenrelatively successful in rural areas, the urbaninitiatives have been based on acommunity action programme which has been slower to develop and morebureaucratic (UNCHS, 1993a). Moreover, changes in organizational responsibilitiesfor implementation and funding under the Government's most recent programmehave meant that the Urban Housing Sub-Programme has lost momentum and is likelyto be the least effective of all (see table 33 ). As can be seen from the table, only15,000 urban poor households had been assisted during the first half of theprogramme. That amounts to only 10 per cent of the programmed target of 150,000.The estimated output of the second half of the programme would still leave ashortfall of some 93,000 units. It thus seems that only one-third of the plannednumber of units will be completed.

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D. South Asia4. Other infrastructural provision

Water supplies in most urban areas in Pakistan are based on ground watersources. Naturally the expansion of the urban population has increased demand andresulted in a lowering of the water table. In cities without ground water supplies, orwhere those supplies are inadequate, water is transported, often over long distances,thereby increasing costs, Qureshi and Bhatti suggest that 80 per cent of towndwellers in major urban centres have access to safe water, but only 40 per cent havewater connections inside their houses. Provision for the poor is via standpipes orthrough water tankers.

Around 59 per cent of the urban population in 1989 had access to sanitationfacilities, whilst about 40 per cent enjoyed a solid waste disposal service (Qureshiand Bhatti, 1991). The majority of sewage and solid waste are disposed of untreatedand cause serious problems of contamination. Even where sewerage and refusefacilities are provided in urban areas they are rarely available in slum and squattersettlements.

Table 34 demonstrates this in respect ofkatchi abadisin Lahore. This showsthat whilst most households had access to water and electricity, human and solidwaste disposal remained major problems (Zaidi, 1990). Moreover, with the rapidgrowth of cities, it is proving increasingly difficult to find suitable sites forsolid-waste disposal, and to extend sewerage and sanitation facilities to slumpopulations.

In Bangladesh in 1990, it was estimated that 63 per cent of urban dwellers wereoutside the public water supply programme (Ahmed and Rouf, 1991). Moreover,only 4 per cent of the urban poor benefitted from the availability of free waterthrough standposts and street hydrants at that time. Programmes are in hand toimprove these services over the next decade, including a major Action Plan of FloodControl which was launched in 1990. As far as urban sanitation is concerned onlyabout 24 per cent of all urban households rely on sewerage provision or septictanks, the rest use pit or bucket latrines, or in many cases, use other means ofhuman-waste disposal. The absence of safe drinking water and poor environmentalsanitation contributes to high rates of disease and infant and maternal mortality, asdescribed above (see also box 5 ).

The successive housing programmes in Sri Lanka have had an impact on watersupplies and sanitation in urban residential areas. But the provision of piped watersupplies and improved sanitary facilities remains a problem in many of the slumareas, particularly in the capital city of Colombo. Some slum settlements in the city

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are also located in low-lying areas where drainage is also a problem. The increasingamounts of solid waste for disposal are also posing problems for the major urbanauthorities.

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D. South Asia5. Land availability

Urban land scarcity, its cost, and speculation by developers constitute majorproblems confronting the urban poor in their struggle for shelter in South Asia. Theproblem of land scarcity is perhaps most marked in Bangladesh where topographicalfeatures limit the supply of available land for urban development, especially inDhaka. The ownership of urban land is highly skewed so that 30 per cent of thepopulation owns and controls 80 per cent of the land. By restricting the availabilityof land, costs are inflated making it extremely difficult for the majority of thepopulation, not merely the poor, to afford to purchase land for housing or forentrepreneurial use. Meanwhile, in the limited sub-markets available to the urbanpoor, newly arriving immigrants continue to seek accommodation, often on a rentalbasis, which increases densities and, together with the natural increase of the hostpopulation, reduces per capita living space to minimal levels and reducesenvironmental conditions to a state prejudicial to health and devoid of essentialinfrastructural provision. In Dhaka especially, this situation is further exacerbated bythe lack of security and threat of eviction which overhangs some slum settlements,and by the loss of accommodation which takes place whenbusteeland is sold formore lucrative purposes, such as commercial development (Haque, 1992).

In Pakistan there are similar problems. Since the late 1970s however, successivegovernments have favoured regularization rather than eviction fromkatchi abadis(Zaidi, 1990), but similar elements are in place. Continued immigration into urbanareas creates land shortages in the major cities which increases prices andencourages land speculation (Malik, 1994). Where public authorities may bedisposed to the acquisition of land for resettlement purposes, or, on behalf of theurban poor, they are handicapped by cumbersome procedures, and by land pricesthey cannot afford. A similar picture of spiralling land prices, accompanying rapidurban growth is also apparent in Sri Lanka (Dickson, 1991).

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D. South Asia6. Summary

South Asia is, together with sub-Saharan Africa, the least urbanized of theregions of the developing world. The urban growth rate, however, is high. Currenttrends indicate that the number of people in urban areas living in poverty in thisregion is likely to increase substantially in the foreseeable future. The likelyconsequence is an alarming deterioration in their housing and environmentalcircumstances.

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E. India1. Urbanization and the growth of human settlements

India is the second most populous country in the world having an estimatedtotal population of 935 million in 1995 (United Nations, 1994). The total populationis expected to exceed one billion before the year 2000. Table 27 illustrates the rapidgrowth of the urban population, which doubled between 1975 and 1995 (reaching251 million), and increased from 21 to 27 per cent of the total. With urbanpopulation growth rates of 3 per cent or more during the next three decades (seetable 28 ), the urban population is projected to reach 292 million by 2000 and 630million (45 per cent of total population) by 2025.

Two salient features of India's growing urbanization are, firstly, the highproportion of natural growth of the urban population, as opposed to rural-urbanmigration; and secondly, the relatively pronounced growth rate of its large cities.According to the National Institute of Urban Affairs (NIUA, 1988a), 41 per cent ofurban growth in India is due to natural increase, 38 per cent due to rural-urbanmigration and 21 per cent due to the reclassification of settlements. Adisproportionate amount of this growth is due to the high birth rates characteristic ofthe low-income settlements in urban areas (Dasgupta, 1994).

In 1981 the proportion of the urban population living in cities with a populationin excess of one million was 26.4 per cent. This figure increased to 32.5 per cent in1991 and is estimated at 35.2 per cent in 1995 as the number of cities with apopulation of over one million reached 29. As table 35 indicates, the growth of all ofIndia's largest cities is projected to remain at rates in excess of 2 per cent per year.The population of the largest cities is expected to increase by 50-100 per cent duringthe next two decades. The largest cities, Bombay, Calcutta and Delhi, are projectedto reach populations of 27 million, 18 million and 18 million respectively by 2015.

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E. India2. The nature and extent of urban poverty

Official estimates of those experiencing poverty in India have varied widelyover time. In recent years, however, two assiduous studies have sought to refine theprocess of estimating the extent of urban poverty in India (Kundu, 1993; Mathur,1994). Kundu explains the increasing divergence in the estimates between the CentralStatistical Organisation (CSO) and the National Sample Survey Organisation (NSSO) in terms of technicalities in the way the price of commodities is estimated andargues for an upward review of NSSO consumption data. By doing this he estimatesthe extent of urban poverty "somewhere between 35 and 40 per cent" (Kundu,1993). In table 36 he compares estimates of poverty from the Planning Commission,from the use of the all-India poverty line, and by aggregating the estimates of StateGovernments. There is a high correlation between the latter two estimates and thereason for the discrepancy between these two and the Planning Commission'sfigures is because of the dependency placed by the Planning Commission on NSSOdata. The table shows that whilst the percentages of those in poverty are declining,the actual numbers are increasing from 50 million in 1970/1971 to some 75 million in1987/1988. If Kundu's assumptions are applied to the 1991 Census figures,somewhere between 76 and 87 million urban dwellers were living in poverty at thattime. If present trends continue — even on the most optimistic assumptions — it ispossible that more than 100 million people will live in poverty in Indian cities andtowns by the year 2000.

Whilst those in poverty may average 3540 per cent in urban areas, other studieshave illustrated that those living in slum areas may experience higher levels of urbanpoverty. A study of 20 towns and cities revealed that 50 per cent of the slumpopulation lived below the poverty line (NIUA, 1988b) and the National Centre forHuman Settlements and Environment (NCHSE) recorded figures of 73 per cent, 89per cent and 68 per cent for the slum population in the cities of Bangalore, Calcuttaand Indore respectively (NCHSE, 1987). Broadly speaking, the percentage ofhouseholds living in urban slum settlements correlates with the level of urbanizationand economic development of the State (Kundu, 1993).

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E. India3. Housing and environmental conditions

Whilst estimates vary (widely) there is a significant shortage of urban housing inIndia. Moreover, table 37 shows that official figures indicate that the shortageworsened from a requirement of 3.6 million dwellings in 1961 to 7.0 million in 1981.Over the decade between 1981 and 1991, however, the shortage appears to haveeased to some 4.8 million dwellings. Other organizations have in the past put thefigure much higher than official estimates. The Birla Institute of Scientific Researchin Delhi, for example, computed a shortfall of between 9.6 million and 22.1 million inurban areas in 1981; and at the same time, the Indian Institute of Management atAhmedabad arrived at a shortage of between 6.6 million and 15.3 million dwellingsdepending on different assumptions (both estimates quoted by Kundu, 1993;UNCHS, 1993c).

Table 37 also provides some indication regarding trends in the quality of theexisting housing stock. The comparison over 1961 to 1991 shows an overall andcontinuing improvement in the housing stock with the numbers ofpuccastructuressteadily increasing and the numbers ofkutchapremises declining as a percentage ofthe total, although increasing in actual numbers.

Table 38 provides further information about trends in the urban housingsituation in India. For the most part it may be seen that these trends are variable (asin the case of the number of persons per room, for example), perhaps increasing innumber between 1961 and 1971, before reducing between 1971 to 1981. There arethree clear trends discernible from the table:

a reduction in the proportion of households occupying a single room from53.1 per cent in 1961 to 39.6 per cent in 1991;

a marginal improvement in the ratio of population per usable housing stockfrom 7.04 in 1961 to 6.74 in 1981; and

a marked increase between 1981 and 1991 in the number of households perhousing unit.

The latter change implies that while each household had their own housing unitin 1981, four households shared three units by 1991. It also indicates that thehousing deficit in India may be much larger than what is indicated in table 37 . Ifhousing need is assessed on the concept of one the household per housing unit, theurban housing deficit in India in 1991 could have been about 15 million units.

Although there was a decreasing trend in the percentage of vacant houses in the

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urban housing stock between 1961 to 1981 (from 7.2 per cent to 6.4 per cent), thefigures had increased again by 1991 to 8.5 per cent.

The average floor area per person in 1983 was 7.81 m², i.e. slightly higher thanin China where the living floor space area in 1985 was 7.46 m² per capita. Around 60per cent of urban households lived in self-occupied houses, whilst most of theremainder rented their accommodation (Kundu, 1993). According to the NationalBuilding Organisation (NBO), 36.8 per cent of urban households had no access tolatrines in 1987. A further 18 per cent had access only to service (communal)latrines, whilst less than 41 per cent had the use of water borne latrines and 58 percent of these were shared (Kundu, 1993).

Whilst the 1991 Census showed very small numbers without access toaccommodation, a large percentage of almost 40 per cent of households still hadaccess to only one room. Rent levels were modest; the share of rent as a proportionof monthly expenditure was about 10 per cent on average.

These overall figures, modest as they are in terms of indicators of housingquality, do not fully convey the housing conditions confronting the urban poor.Kundu takes his analysis further by examining directly the living conditions of thebottom 40 per cent in terms of monthly per capita consumption. Table 39 shows thetype of housing structure by income profile for the lowest 40 per cent of theconsumption spectrum and compares this with average figures. It may be seen fromthe table that (with the exception of the lowest class Rs.030), those with the lowestconsumption capacity were much more likely to live inkutchaor semi-puccastructures than the average. Even when averaged as a group, more than a quarter ofthose in the lowest 40 per cent expenditure category lived inkutchadwellings (ascompared with 16.4 per cent of households as a whole), and about a third lived insemi-puccastructures (as compared with 25.7 per cent of all households).

Table 39 also shows the distribution of per capita floor area according to thelowest 40 per cent of expenditure classes. This table shows that those in the lowestexpenditure classes are living in houses with significantly less per capita floor areathan average households. Indeed those in the higher expenditure classes (notillustrated in the table), enjoy 4 times more per capita floor space than those in thebottom class. Kundu argues that "the bottom 39 per cent of households occupyonly 28 per cent of the floor area (whilst), the top 22 per cent claim a share as highas 56 per cent". Given that a large proportion of households live in one-roomed unitsand that average household size may comprise 5 or 6 persons this implies that manydwellings in slum areas have highly restricted floor areas.

Table 40 provides information about housing tenure and housing costs amongstthe urban poor. This table provides some interesting insights into the housingbehaviour of low-income groups in India. It shows, firstly, that the phenomenon ofrenting increases with the level of expenditure. Thus only 11 per cent of householdsin the lowest expenditure class are renters, whereas in the higher groups the

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proportion rises, and in the very highest groups (not shown in the table), theproportion is 50 per cent and higher. It may be seen that amongst the poor as awhole only 26 per cent of households live in rental premises. The explanationprovided by Kundu is that renting a dwelling is not only expensive but it also impliesa legal status. It may be that new arrivals may have to rent premises when they firstcome to the city, but as rents are high, they very soon move out to a cheaper option,often squatting illegally on publicly owned land. This too is not entirely free ofcharge:

"The field surveys ... revealed that in the squatter settlements some illegaloccupants had to regularly pay either the police or slum lords for their protectionagainst fire, eviction and other harassment. Also at the time of their initialconstruction/occupation they were required to pay certain sums either to the police,the local lord or the previous settler. Around one-third of households had paid Rs.1,500 to 2,000, another one-third between Rs. 1,000 and 1,500 and the rest less thanRs. 1,000 for constructing their huts" (Kundu, 1993).

These data provide firm evidence that, despite the overall improvements whichmay be discernible from national trends in the housing stock, the urban poor remainsystematically disadvantaged in terms of access to shelter of reasonable quality, ofappropriate size and legal status, and at affordable cost.

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E. India4. Other infrastructural provision

As far as water supplies are concerned NSSO data indicates that 34 per cent ofthe urban poor are not provided with a piped water supply, relying on alternativessuch as handpipes and tubewells (19 per cent), orpuccawells (15 per cent). Since thepiped water supply is available at very low cost this implies that the benefit of thissubsidy is enjoyed much more by the richer sections of the community than thepoor. At the same time the distribution of water is also inequitable, not only betweenstates, but also in urban areas. Kundu estimates that in the relatively less developedstates, the percentage of the poor not serviced by the public water system may be 60per cent and a number of studies have indicated the per capita consumption of wateron a daily basis to be much lower in slum areas than other parts of cities. An NIUAstudy (1988b), for example, showed that water provision through public stand postsin Madhya Pradesh varied between 22 and 36 litres per capita per day, whilst thesupply through the domestic piped water distributional system was between 36 and120 litres per capita per day. Similarly, in Ahmedabad, 25 per cent of the populationconsumes 90 per cent of the water supply (Kundu, 1993). Not only is the number ofpersons serviced by public stand posts likely to be higher than recommended levels,(19) but per capita water consumption by the urban poor may be well belowrecommended minimum levels.

Access to sanitary facilities is also limited for the urban poor. Amongst the verypoor only about one-third have access to a latrine facility, whilst the proportionincreases to about half amongst those at, or immediately below, the poverty line.Only very few have access to flush latrines which are connected to the seweragesystem and managed and maintained by local authorities and thereby subsidized inthe same way as water supplies. The majority of those with access to a latrine facilityare also likely to share. Amongst the very poor, 70 per cent with access to a latrineshare it with others. This proportion falls to around 40 per cent of those immediatelybelow the poverty line. For the very poor with access to a latrine the most frequentlyused facility is a septic tank and for those with slightly higher consumption levels, aservice latrine (community facility). The latter are often badly maintained, however,and unhygienic.

These statistics demonstrate the abysmally low levels of provision for the urbanpoor in respect of water supplies and sanitation. They illustrate, however, that themore affluent sections of the community benefit to a much larger extent from thepublic services provided. The consequence of these grossly inadequate levels ofprovision, poor maintenance, lack of public awareness and low levels of health care,is that "birth and death rates in slum areas are higher by 40 to 50 per cent and infantmortality rates higher by 1.8 times as compared to non-slum areas"

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(Sivaramakrishnan, 1991). The consequences for public health, however, asdemonstrated recently by the outbreak of pneumonic and bubonic plague in Surat,extend far beyond the slum settlements themselves.

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E. India5. Land availability

The National Commission on Urbanization (NCU) observed that, "possibly themost disastrous feature of the past four decades of urbanization in India has beenour tragic failure to anticipate the rising demand for urban land, and thus be able toensure an adequate supply at affordable prices" (NCU, 1988a). India has been onecountry, however, where the government has made a major intervention in the urbanland market through the Urban Land (Ceiling and Regulation) Act of 1976. Theintention of the Act was to impose a ceiling on the ownership of vacant landholdings; to limit the size of dwelling units constructed, and to regulate the transferof urban property. Unfortunately, the Act has not had the desired effect and hasyielded only a fraction of the land identified as surplus under the legislation. Thereasons may be summarized as follows:"firstly, administrative laxity combined with the absence of a strong will ...secondly, the exemption clauses have prevented the transfer of surplus land to thegovernment, and have provided legal loopholes that the owners were quick toexploit .... Thirdly, instead of mopping up surplus vacant land, it has frozen landtransactions ... and has pushed up the prices of land, especially of those parcels ofland which the landowners were allowed to retain" (Sundaram, 1989).

The Act is widely believed to have exacerbated the problems of the urban poor,by freezing some areas of urban land which might otherwise have been available fordevelopment and by forcing up prices. It has not resulted in any significant increasein the supply of urban land specifically for the urban poor, nor in any significantsupply of accommodation for their use.

One consequence of rising land costs has been the increasing densities of thoseareas available to the urban poor — hence residential densities in thechawlsofBombay, thebusteesof Calcutta, or the tenemental structures of the inner cores ofolder Indian cities, such an Shahjahanabad in Delhi, are intolerably high.

Alongside the distortions to the market caused by the Urban Land Ceiling Act,Sundaram is also critical of building and planning standards. Citing the example ofsuch standards in Bombay, he asserts that, "the prescribed standards have kept landutilization at a low level of intensity and discouraged the building of dwelling unitswhich poor people could afford" (Sundaram, 1989). The result has been effectivelyto disenfranchise the vast majority of the urban poor from the opportunity of legalland ownership and participation in the formal housing market and instead to drivethem into illegal squatter settlements or onto marginal or peripheral sites.

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E. India6. Summary

It has been estimated that between 35 per cent and 40 per cent of those living inurban areas in India are experiencing conditions of poverty, that the numbers areincreasing and by the year 2000, the number of people living in poverty in Indiancities may reach 100 million people. This is an alarming statistic. Whilst overallhousing statistics demonstrate a broad improvement in the quality of the housingstock over time, a more detailed elaboration of the shelter circumstances of thepoorest groups reveals very little evidence of improvement. Indeed increasingnumbers of the urban poor continue to live in inadequate housing, without security,and with an abysmally low level of provision of public services.

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F. East Asia and the Pacific1. Urbanization and the growth of human settlements

Table 41 illustrates the growth of urban populations between 1975 and 1995amongst selected countries in East Asia and the Pacific. It also shows projectedgrowth to the year 2025. Because of its sheer population size — some 1.2 billion in1995 — China is discussed in a separate section.

As can be seen from the table, the level of urbanization of the region variesbetween the Republic of Korea where 81 per cent of the population is living in urbanareas, and Thailand, Viet Nam and Cambodia where only about 20 per cent is livingin cities and towns. The largest urban population of the region can be found inIndonesia, where 70 million of the region's 223 million urban dwellers are located.Other large urban populations can be found in the Philippines and the Republic ofKorea, each with urban populations of about 37 million. For the region as a whole,some 39 per scent are living in urban areas. The percentage is, highest in thesubregion of East Asia where 76 per cent are living in urban areas. In South-EastAsia the percentage is 34.

As can be seen from table 42 , the urban population of the region has grownwith some 125 per cent during the last two decades. The most rapid growth over thelast two decades has occurred in Cambodia where the urban population has nearlytripled between 1975 and 1995. The growth in Indonesia (167 per cent), thePhilippines (139 per cent) and Malaysia (134 per cent) has also been rather high.United Nations projections indicate that this rapid growth will continue for the nextthree decades. The average annual regional growth rate for the region as a whole forthe 19952005 period is projected to be 3.2 per cent. The rate is likely to decline butwill remain above 2 per cent also during the 20152025 period. Quite naturally thegrowth rate is projected to be lowest in the countries with the highest level ofurbanization, like the Republic of Korea (1.8 per cent during 19952005) and theDemocratic People's Republic of Korea (2.1 per cent).

Growth rates will decline even further in the Republic of Korea (to 0.6 per centduring the 20152025 period), the Democratic People's Republic of Korea (to 1.6 percent), the Philippines (to 1.7 per cent) and Malaysia (to 2.0 per cent). In all thesecountries the urban population is projected to account for more than 70 per cent ofthe total by 2025. In countries like Cambodia, Viet Nam and Myanmar, the averageannual growth rate for urban areas is projected to remain above 3 per cent per yearfor the next three decades. These three countries will, together with Thailand, have apredominantly rural population even three decades from now.

In terms of numbers, the largest urban population growth will occur in

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Indonesia, where some 3.3 million urban dwellers (39 per cent of the increase for theregion as a whole) will be added each year for the rest of this century. The growth inthe Philippines amounts to some 1.5 million each year. For the region as a whole theabsolute volume of urban growth is currently five times higher than that of ruralareas. Three of the countries in the region (the Republic of Korea, Indonesia and thePhilippines) are currently experiencing a decline in their rural populations (UnitedNations, 1994). This trend is, however, spreading. According to the projections,only Viet Nam, Myanmar and Cambodia (among the countries listed in tables 41 and 42 ) will experience an increase of their rural populations during the 20152025period. For the region as a whole urban growth will remain between eight and ninemillion each year for the next three decades, while a rural growth of 1.6 million peryear during the 19952005 decade will be replaced by an annual reduction of ruralpopulations of some 620,000 during the 20152025 period.

The majority of cities of the region are also experiencing rapid growth. Yet, astable 43 indicates there are two categories of cities in the region, i.e. those whosepopulations seem to have stabilized (cities in highly urbanized countries like theRepublic of Korea and Hong Kong), and those that grow at rates averaging between2.5 and 4.0 per cent per year. The most rapidly growing city is Jakarta, with aprojected average annual growth rate of 3.8 per cent during the next decade. Thepopulation of Jakarta is expected to reach 21 million by 2015.

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F. East Asia and the Pacific2. The nature and extent of urban poverty

Official estimates of urban poverty in Indonesia are illustrated in table 44 . Thetable shows that the numbers in urban poverty have remained more or less constantbetween 1976 and 1990. During that time the urban population grew from 26 millionin 1975 to 70 million in 1990 (United Nations, 1994). UNCHS (1993d) estimates thatmore than two thirds of the urban growth is due to rural-urban migration. The factthat the numbers experiencing poverty have remained constant suggests that theurban economy has been relatively successful in absorbing 44 million new peopleover 15 years without a significant increase in subsistence poverty. Whilst it appearsthat most migrants to the urban areas are able to improve their income and livingconditions over time, those who remain vulnerable to continued poverty are, "thehandicapped, physically disabled, illiterate, widows or single parents" (Suhandjaja,1991).

In the Philippines the urban population is concentrated in Metro Manila (whichhad an estimated population of 9.3 million in 1995 and accounted for about a quarterof the urban population). Rapid urbanization has resulted in a proliferation of urbanslums and squatter settlements and Nuqui (1991), estimates there are over 10 millionslum-dwellers and squatters in urban areas throughout the Philippines accounting forabout 40 per cent of the urban population. He profiles a typical slum household asfollows:"nuclear rather than extended. It usually has six members, the majority beingyoung. ... The household head ... is typically in the forties with some elementaryeducation. The husband and wife are usually migrants from themore depressedregions .... The worst off are street children working in hazardous or exploitativeconditions" (Suhandjaja, 1991).

In 1990 it was estimated that there were 60,000 street children in Metro Manilaand 25,000 in other cities in the Philippines.

Official estimates of poverty in Bangkok show a rapid reduction during the late1970s from 6.9 per cent of the core urban population in 1975/1976 to 3.7 per cent in1980/1981, but thereafter, a stabilization of those in poverty throughout the 1980s. In1988/1989 the figure was 3.3 per cent (Hutuserani and Tapwang, 1990). Two studiesof urban poverty conducted in the mid-1980s, (20) have identified a strong correlationbetween urban poverty, poor education and status in the labour market.

Chang (1991) argues that the official figures for poverty in South Koreaunder-estimate total numbers in urban areas particularly, because the government'spoverty line does not differentiate between urban and rural areas. In 1990 the official

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estimate of the urban poor was 1.3 million or 3.0 per cent of the total population (4.1per cent of the urban population). Research carried out by the Korean ResearchInstitute for Social Sciences (KRISS) found that the minimum living costs for afamily of five were 60 per cent above the official figure. Whilst absolute poverty isdecreasing rapidly in Korea, the problem of relative poverty has become moreserious.

The problem of urban poverty in Malaysia has become more significant withthe accelerated trend of industrialization (Karthigasu, 1991). Government figuresshow that, over a period between 1970 and 1984, whilst the overall proportion ofthose in poverty living in urban areas fell from 21.3 to 8.2 per cent, the actualnumbers increased from 86,000 to 97,000 households.

To summarize the trends in urban poverty in these East Asia and the Pacificcountries, official figures and other studies tend to show that whilst the proportion ofthe urban population in poverty is decreasing, the actual numbers are increasing or,at best, stabilizing. The major reason for this is rapid urbanization as a result ofrelatively successful economic growth through industrialization. There is someevidence that whilst those in absolute poverty may be decreasing, there is anincreasing problem of relative poverty. Those affected are newly arriving householdsfrom rural localities, the handicapped and physically disabled, single women andwomen headed households, those with rudimentary education and, in somecountries, there is a disturbing problem of street children. It is evident that therelative success of these economies is itself a problem in that it attracts largenumbers of migrants from rural localities who are unable to be absorbed into theurban labour market with the result that low pay and casualization of a significantpart of the labour force is continued.

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F. East Asia and the Pacific3. Housing and environmental conditions

The process of rapid urbanization in the region has produced a legacy ofdegraded housing and environmental conditions for the urban poor. The demand forland and shelter far exceeds the supply available. Formal housing provision isbeyond the affordability of the poor and often infrastructural provision isoverwhelmed by the demands of the urbanizing population. Circumstances inIndonesia, for example, are as follows: firstly, there is an overall shortage of urbanhousing. Comparing total households in urban areas with the number of housingunits, there is a shortfall of 864,000 dwellings (see table 45 ).

Table 46 shows that much of this stock is of a temporary nature (althoughinsofar as this is a measure of housing conditions, it may be seen that there has beenan improvement over time). Nonetheless, almost a third of all structures in urbanareas were temporary by the early 1980s. A similar proportion of the housing stock(30.6 per cent) is also below 40 m² in size (CBS, 1990), and a large proportion oflow-income households lack access to electricity and piped water supplies (TheUrban Institute, 1988 — quoted in Suhandjaja, 1991). These problems arecompounded by the illegal status of many slum settlements in urban areas, the use ofmarginal sites, such as areas liable to flooding, and the absence of infrastructuralprovision, like proper sanitation and refuse collection services. In the major cities,such as Jakarta and Bandung, population densities may exceed 1,000 persons perhectare and in these circumstances environmental conditions are seriously prejudicialto the health and safety of residents. In such circumstances it is estimated that up to40 per cent of the urban poor are dependent on renting a room or a dwelling, ratherthan owning it, further emphasizing the frailty of their asset base (Suhandjaja, 1991).

Whilst current housing conditions are serious, projections of future need areawesome: "It is estimated that just below 2 million dwelling units of all types arerequired annually in the next 20 years to meet the national housing need. A total of750,000 units is required annually to meet the demand created by the populationgrowth while a further 100,000 units are required each year in the next 20 years toalleviate the current housing shortage, estimated at 2 million units. The remainder isrequired to replace (350,000 units) or upgrade (700,000 units) the deterioratinghousing stock" (UNCHS, 1993d).

The housing situation in the Philippines is characterized by a huge backlog ofneed, estimated at 3.9 million units over the period 19931998, with 2.9 million unitsrequired in urban areas (Alonzo, 1994). This is far greater than the government hasthe capacity to produce, although the current administration has committed itself toprovide assistance towards 1.2 million units (just over 40 per cent), during that time.

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Housing need is most acute in Metro Manila and it is estimated that 430,000, or 26per cent of the 1.6 million households living in the capital, are residing in informalsettlements. More than half of these households (224,000 or 52 per cent), are livingin dangerous circumstances, in swamps, on waterways, or on areas liable toflooding. These households are faced with constant insecurity and an almost totallack of basic urban services, such as potable water and electricity (Alonzo, 1994).

The growth rate in the number of households in East Asia and the Pacific isnearly twice that of population growth. The reason for this is a rapid decline in theaverage size of households. While the average household size (urban and rural) in1995 is 4.5 persons, it is projected to decline to 3.5 by 2025 (see table 5 ). Thus, ifthe increase in the number of households is taken as an indicator of additionalhousing demand, future housing demand is going to be even higher than thepopulation growth figures indicate. This situation is most striking in the Republic ofKorea where — according to United Nations projections (United Nations, 1994;UNCHS, 1996) — 459,000 households additional households will be created eachyear (in rural and urban areas) compared to a population growth of 'only' 431,000persons. In Thailand, one new household will be formed for every 2.6 persons newpersons added to the population. In Indonesia and the Philippines one newhousehold will be formed for every 3.1 person added.

Whilst the scale of poor housing conditions may be greater in Indonesia and thePhilippines than in other countries in the region, and there may also be somevariation in characteristics from one country to another, a similar profile of wretchedconditions may be drawn in each of the major cities in these South-East Asiancountries. Yet, in each of these countries an array of interventionist policies has beenintroduced to combat poverty including those concentrating on the shelter sector,e.g. slum upgrading, relocation and 'sites-and-services' or 'core' housing schemes. Itis evident, therefore, that the task of maintaining housing standards in the face ofincreasing demand from the urban poor is a formidable one and for a variety ofreasons (which will be discussed in chapter V), these programmes have done littlemore than scratch the surface in terms of improving the housing and environmentalconditions of the urban poor.

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F. East Asia and the Pacific4. Other infrastructural provision

The picture is perhaps marginally more optimistic in respect of infrastructureprovision. It is in this area that governments have made more effective interventionsthan in respect of housing itself. In Indonesia, the Kampung ImprovementProgramme and, more recently, the Integrated Urban Infrastructure DevelopmentProgram, have been major initiatives aimed at improving urban infrastructuralfacilities. The Kampung Improvement Programme in particular, has been directedtowards poor settlements and has been effective in ameliorating some of the worstenvironmental conditions (Taylor, 1987). Nonetheless, there remain problems withwater supply where only 30 per cent of the urban population has been served owingto "high water losses and decreasing source production combined with poormanagement" (Suhandjaja, 1991). Connection costs have also been a problem and,since social connections are not seen as cost effective by the private watercompanies, public standposts serve only a small proportion of the urban population.Figures provided by the World Bank (1994a), show no improvement in thepercentage of the urban population with access to safe drinking water between 1980and 1990. In 1990 the figure remained at 35 per cent.

Whilst water supplies to the urban poor lag behind provision as a whole,communal supplies have extended piped water coverage to the majority of the urbanpoor in Malaysia, the Republic of Korea, and Thailand. There remains a problem inthe Philippines, however, where the illegal status of many slum and squattersettlements has precluded provision, not only of communal water supplies, but alsoof human waste disposal facilities, electricity and other forms of infrastructure.Whilst the problem of illegal status and its detrimental impact on infrastructuralprovision is not confined to the Philippines it appears to be more widespread therethan in other countries in the region.

Despite the provision of communal facilities, human-waste disposal remainsmore of a problem than water supplies. In Indonesia 30 per cent of the urban poorhave no access to public toilet and/or bathing facilities (Suhandjaja, 1991). InMalaysia, according to a rather dated study carried out between 1978 and 1980, onlyabout half the urban poor in Kuala Lumpur had private sanitation (Karthigasu, 1991).In the Republic of Korea, the equivalent figure was 71 per cent having either personalor shared (rather than communal) use of latrines (KRIHS, 1989). This is also aproblem in the Philippines and Thailand. In terms of sanitation, cost considerationsare also a factor accounting for the lack of provision for the urban poor.

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F. East Asia and the Pacific5. Land availability

As indicated above the issue of land scarcity and illegal status is a majorproblem for the urban poor. It is also widespread throughout the South-East Asiancountries. In the Philippines, Nuqui (1991) estimates that 90 per cent of the urbanpoor lack security of tenure. In Thailand, Krongkaew and others (1986) found that53 per cent of poor households in Bangkok were squatters with virtually no securityand in Chiang Mai to the north, the figure was 70 per cent. Even in the Republic ofKorea where large-scale relocation has taken place, two studies in 1989 revealed thatonly 31 per cent of the urban poor in Seoul owned their own land and residence (KRIHS, 1989), and only 21 per cent of residences in poor areas were licensed (KIIE, 1989). It is now widely acknowledged that security of tenure is a key requirement inshelter strategies for the urban poor, but the problems of land scarcity and risingprices have so far meant only modest progress with individual relocation projects.

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F. East Asia and the Pacific6. Summary

The human settlements conditions of the urban poor in East Asia and thePacific can be summarized as: the problem of land scarcity and illegal statusconfronting many poor communities; difficulties of access to the urban housingmarket for the urban poor and rural-urban migrants largely on the grounds of lack ofaffordability; the continuing inadequacy of housing and environmental conditions inwhich the urban poor have to live; and the lack of infrastructural provision andservices, such as water supplies, electricity, sanitation and waste disposal. Despitethe fact that East Asia and the Pacific (including China) is the only region where it ispossible to discern improvements in the housing and environmental circumstances ofthe urban poor, the above constitutes a formidable agenda for the cities of the regionduring the next few decades.

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G. China1. Urbanization and the growth of human settlements

China is the most populous country in the world, having approximately 20 percent of the entire global population. Table 41 shows the growth of the urbanpopulation since 1975 and projects urban population growth to the year 2025. Whilstthe total population of China has grown by almost 50 per cent during the last twodecades, to l.2 billion in 1995, the table demonstrates that the urban population hasincreased by 130 per cent over the same period. A word of caution must beintroduced about the definition of the 'urban' population, however (in addition to thereservations raised in chapter I). Since 1964 each city has included subordinatecounties and towns including an agricultural population whose socio-economicbenefits and activities are determined by rural policies. The non-agriculturalpopulation of towns and cities therefore, is less than the figures shown for urbanareas.

This urban growth occurs at a time when China's rural population declines withan average of two million each year between 1995 and 2000. In fact between nowand 2025 the rural population of China will contract with a projected total of morethan 150 million people.

Despite strict family planning policies and controls on population movementbetween rural and urban areas, the urban population is growing rapidly — currentlyat an average rate of 3.4 per cent per year (see table 42 ) — and is expected to reach443 million by the year 2000 and 830 million by 2025. As can be seen from the tablethe rate of urban growth is expected to decline, yet the growth in terms of people isstill increasing. Each year during the next ten years an estimated 14.9 million peopleis added to China's urban population. This figure will increase to 15.8 million during20052015.

The growth rates in China's largest cities is slightly less than that of the urbanpopulation. Yet, with average annual growth rates of between 2.5 and 3.0 per centfor the next ten years and then rates of about 2.0 for another ten year period, Chinawill have 16 cities with a population of more than 4 million by 2025, compared to"only" six in 1995 (see table 47 ). The three largest cities, Shanghai, Beijing andTianjin, are projected to have populations of 23 million, 19 million and 17 million by2025.

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G. China2. The nature and extent of urban poverty

In the urban areas of China, permanent residence registration has affordedguaranteed employment, access to rationed essential consumer items, and anelaborate enterprise-based labour-insurance system which involves not only healthcare, but also retirement and disability provision (Ahmad and Wang, 1991). Inaddition, other major items of consumer expenditure, on housing and transportation,for example, have also been heavily subsidized by the state. Until recently, this hasensured that basic nutritional standards and minimum levels of shelter, health careand education have been attained. Since the introduction of new economic policiesafter 1978, however, the liberalization of industrial and commercial activities hasresulted in a dramatic growth of average incomes (see tables 48 and 49 ), and theemergence of relatively modest income disparities. At the same time the relaxation ofregistration procedures has also seen the reappearance of rural-urban migration andthe emergence of a large 'floating' population associated with the major cities. Thisfloating population does not enjoy the benefits of registration and would thereforeneed a higher income level to achieve a comparable standard with registered urbandwellers. The growth of inflation during the late 1980s has also had an adverse effecton those on fixed incomes with the State Statistical Bureau reporting a decline in realincomes for 35 per cent of the population in 1988 (Ahmad and Wang, 1991).

Recognizing the difficulties associated with an absolute urban poverty line,Ahmad and Wang adopted three different measures for income poverty, firstly, theyutilized a poverty line set at 50 per cent of average urban income; secondly, a percapita figure of Yuan 375 per annum; thirdly, a minimum figure of Yuan 300 perannum. The results are set out in table 50 . The table shows that 28.2 millions (11.7per cent of the urban population), were living in poverty in 1985 and 22.5 millionswere experiencing 'acute' poverty (9.3 per cent of the urban population). Theseoverall numbers fell in 1987 to 14.1 million and 9.4 million respectively, before risingsharply in 1988 to 19.8 million and 15.8 million.

In identifying those who might be affected by urban poverty in China, Ahmadand Wang (1991) concluded that pensioners on fixed incomes would be veryvulnerable; the 'floating population' or 'those looking for work' were also likely toform a group affected by poverty; thirdly, disabled people were also at risk; and thefinal group were 'those afflicted by natural disasters'. On average 100 million peoplein China are affected by natural disasters each year.

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G. China3. Housing and environmental conditions

During the 1980s a series of experimental reforms were carried out in differentcities aimed at transforming urban housing from a welfare oriented system to one inwhich private ownership was encouraged under socialist conditions. Theexperimental phase culminated in the National Housing Reform Plan issued by theState Council in 1988. The Plan incorporated four main elements in an ambitiousprogramme designed to be implemented in all towns and cities throughout Chinawithin three years. These elements were:

The raising of rent levels. Rents had been set at historic levels (in the 1950s)and the effects of inflation by the late 1980s meant they no longer coveredmanagement and maintenance costs. The aim is to increase rentsincrementally over time in order to cover these costs, as well as loandepreciation, interest, fees and taxes, insurance charges, and ultimately,reasonable profits.

To establish a providential housing fund. With the objective of enablingpeople to invest more of their own resources in the housing sector it was seenas important to establish an institutionalized housing savings facility. Manycities have now established Housing Funds along the lines of the ProvidentialPension Fund in Singapore with both individuals and employers contributinga fixed amount of their income into the Fund. Employees may subsequentlydraw on their savings for house purchase, or repairs and maintenance of theirhousing.

The aim of raising rents and establishing institutionalized savings for thehousing sector is to encourage the privatization of the housing stock throughindividual purchase arrangements. Despite creative discounting initiatives,only a relatively small proportion of the population can currently afford topurchase their accommodation, but it is hoped that the arrangements madewill increase the numbers eligible over time.

To protect the interests of those households experiencing housing difficultiesthrough upgrading programmes and subsidized rental schemes.

The reforms are in their infancy and problems with inflation have alreadyrevised the timescales over which the reform process is envisaged. But the StateCouncil approved further measures designed to "deepen the process of urbanhousing reform" in 1994. These measures included a recognition of the need for anenhanced capacity for housing management; more sophisticated insurance, financeand borrowing systems; and arrangements to establish a healthy property exchange

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and repairs and maintenance market (Wang and Murie, 1994).

In the meantime, housing investment in China has also received a major boost.Between 1979 and 1987 housing investment amounted to an annual average of 6.7per cent of GNP and urban housing development received the equivalent of 3.1 percent (Lin Zhiqun, 1991b). As a result there has been a steady improvement inhousing conditions in larger urban areas. Table 51 demonstrates, for example, thatthe available floor area per household is steadily increasing, and so too is the numberof rooms per household. At the same time, the percentage of households withhousing difficulties of one sort or another is decreasing (see table 52 ), i.e. unallottedhouseholds (households without a unit); overcrowded households and those havinginsufficient space (i.e. with children over 13 years of different sexes, or two couples,sharing a room). Since 1983 the Chinese government has targeted these householdswith a series of special initiatives designed rapidly to upgrade the quality of thestock. Between 1986 and 1992, 6 million households benefitted from this programme(Song Chunhua, 1994), but by 1992, four million urban households still had less than4 m² per capita living space.

These figures show that improvements are being made on addressing thehousing deficit in China. Yet, the challenge ahead is truly staggering. If each ofChina's households are to get their own dwelling unit, it implies that some 8.6 millionunits are required each year to the year 2000, increasing to 10.5 million units per yearbetween 2000 and 2005 (UNCHS, 1996). The number of households is currentlyincreasing at a rate nearly three times that of population growth (see table 5 ), asituation unparalleled in any other region of the world. Despite a planned increase ofinvestments in urban housing during the 1990s of approximately 2.5 times that spentduring the 1980s, it is expected that by 2000 some 4.44 million urban households willstill experience "housing difficulties", i.e. some 6 per cent of all households. Some270.000 households (0.4 per cent) are expected to experience "extreme housingdifficulties" (Gu Yunchang and Gao Xiaohui, 1992).

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G. China4. Other infrastructural provision

For many years during the 1960s and 1970s there was very little investment inurban infrastructure of Chinese cities. Since 1978, however, there has been a majorshift in investment, alongside urban housing provision, to improve the quality of theurban environment. Hence the per capita domestic water supply increased by 250per cent between 1965 and 1992, and the percentage of the population with accessto tap water increased from 74 per cent to 92 per cent over the same period. As maybe seen from these and other statistics in table 53 there has been a rapidimprovement in most aspects of urban infrastructure in China in recent years. At thesame time, services such as water and transportation receive substantial publicsubsidies and costs to consumers are, therefore, very low. In 1989, for example, theaverage annual expense per urban dweller for transportation in the city was about0.22 per cent of his/her living costs, and only one-third of all flats in urban areashave "independent kitchen and toilet facilities with their own water system" (LinZhiqun, 1991a).

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G. China5. Land availability

Whilst the centralized control of land use and stringent controls on populationmovement have prevented the kind of land speculation frequently found in urbanareas in the capitalist economies, it has not entirely solved distributional problems forthe urban poor, since those outside work units (i.e. the 'floating population'), or inwork units of low status or earning capacity, may fail to have their requirements forland acknowledged in the planning process. In order to avoid this problem, theGovernment of China has encouraged the formation of cooperatives for the latterunder the reform process.

At the same time, market valuations are gradually being introduced into landdevelopment transactions and a process of residential differentiation is emerging aslarge-scale construction companies undertake major projects for sale rather than rent.The major urban development programmes are also stimulating a debate in Chinaover issues of land supply for urban usage as opposed to agricultural productionand in some cities, most notably Shanghai, there is an acute shortage of land fordevelopment (Dong Liming, 1994).

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G. China6. Summary

Whilst the Government of China has made major strides to improve the qualityof housing and the urban environment since 1978 it is also evident that housingconditions for the poorest groups are very basic. Only about a third of all flats inurban areas have independent kitchen and toilet facilities with their own piped watersystem. Moreover, housing conditions are likely to remain very modest for a longperiod to come. Despite a planned increase of investment in urban housing duringthe 1990s of approximately 2.5 times that spent during the 1980s, 6 per cent of allurban households is still expected to experience housing difficulties by the year2000.

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Chapter V. Reaching the urban poor

Following the overview of the incidence of urban poverty and trends in thehuman settlements conditions of the urban poor in developing countries, this chapteroutlines the changing international policy context for urban development and shelterprovision. It also presents a series of detailed case studies of recent shelter initiativesfrom Zimbabwe, Brazil, the Republic of Korea and India. (21) These four case studiesencompass a variety of approaches to the problem of providing housing for thepoor and low-income groups. The Zimbabwean case study focuses on the recentsites-and-services programmes in Harare. The second example is the FUNACOMprogramme ("the municipal programme to support housing for low-income personsthrough self-management"), set up by the São Paulo local government in Brazil in1989. The case study from the Republic of Korea involves an evaluation of anemployees' housing programme which was designed to provide 10,000 housing unitsduring the 19901991 period. It was the forerunner for the current programme of500,000 houses to be provided between 1992 and 1996 as outlined in the Republicof Korea's Seventh Socio-Economic Development Plan. Finally, the case study fromIndia is an evaluation of a series of Slum Improvement Programmes funded andadministered by the Overseas Development Administration (ODA) of the UnitedKingdom of Great Britain and Northern Ireland, in partnership with the Governmentof India and various state governments. In the concluding section these programmesare assessed against the policy framework for human settlements development andthe formulation of shelter strategies for low-income groups advocated by UNCHS(Habitat) and the World Bank.

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Chapter V. Reaching the urban poorA. The changing international policy context for urban development and shelter

There is a wealth of empirical evidence to show that shelter programmesconceived along the lines of Western democracies, with strong state involvement inthe design, construction and allocation of housing targeted towards the urban poor,have not worked well in developing countries. In analyzing the effectiveness of suchprogrammes, UNCHS (1991c) concluded that there were at least five majorweaknesses of past shelter strategies in addressing the needs of low-income groups.These were, firstly, that governments had been much too concerned with producingformal housing programmes rather than facilitating inputs such as land and credit intothe housing process. Secondly, there has been a mis-allocation of resources in theform of subsidies to land, infrastructural provision and towards housing itself, whichhas gone to those better able to pay for such services than the poor. Thirdly, "therehas been a consistent failure among official land, housing and financial agencies toreach those who need assistance most of all" and the review of shelter circumstancesin chapter IV illustrates that this is not only a continuing problem in many parts ofthe developing world, it is also a growing problem. Whilst there have been somesuccesses in shelter programmes, however, these have generally been on a very smallscale in comparison with the overall magnitude of the problem; and finally, coherentand coordinated local shelter strategies have been the exception rather than the rulewhich has made it very difficult to adopt consistent and effective policies towardsthe needs of low-income groups (UNCHS, 1991c).

But the policy context for shelter programmes is changing. Since the adoptionof the GSS in 1988 both the World Bank and the UNDP have published importantpolicy documents which have refined and developed their approaches towardshousing and urban development in a global context. Both agencies published verysimilar 'urban agendas' for the 1990s (UNDP, 1991; World Bank, 1991), and theirrespective policies have subsequently been influenced by UNCED in 1992.

The GSS embodies a number of basic principles:

the need to adopt an "enabling approach whereby the full potential andresources of all the actors in the shelter production and improvement processare mobilized";

the requirement to develop sustainable shelter strategies which are realistic interms of implementation and the consumption of natural resources;

the need to formulate explicit policies for housing the poor as a centralcomponent of the shelter strategy;

the importance of acknowledging and enhancing the role of women overdecision-making on shelter issues; and

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the importance of instituting a monitoring and evaluation programme toensure that the effectiveness of the strategy is regularly reviewed.

Translating such a strategy into action was seen to demand new perceptions;the importance of cities in contributing towards the overall growth of the economy;an acknowledgement of the shelter sector as an important part of the economy; theneed for a scaling-up of production programmes drawing on all sources, includingthe informal sector; a balance between shelter upgrading and new provision; a needto acknowledge the significant role which may be played by the private rentedsector; as well as a realization that programmes for the poorest groups will continueto require a direct role for the state.

The subsequent urban agendas of the international agencies were responses toprolonged economic recession, continued infrastructural deficiencies andenvironmental degradation, and the growing problem of urban poverty. The WorldBank emphasized its analysis of these problems in terms of the low productivity ofurban areas and set out a four-fold programme accordingly:

The need to improve urban productivity by strengthening the management ofurban infrastructure; streamlining regulations, encouraging privatization andmarket competition; improving the financial and technical capacity ofmunicipal institutions, and enhancing the capability of institutional finance tofacilitate urban development.

The alleviation of urban poverty (outlined in World Bank, 1990). Thisstrategy included the concept of a 'safety net' for the poorest sections of thecommunity including the physically and mentally handicapped, the elderly,uncared for children and destitutes. At the same time it advocated thegeneration of employment opportunities in order to improve the productivityof the urban poor (especially women), improvements in shelter and theprovision of basic services.

Developing effective responses to the growing urban environmental crisis byimproving the information base and enhancing awareness and understandingof the processes involved; developing city-wide strategic responses tocombat environmental deterioration by adopting realistic standards ofregulation and enforcement and working in partnership with others.

The need to increase understanding of urban issues through a reactivatedprogramme of research.

The UNDP strategy paper outlined a similar series of issues as the mainconcerns of its agenda for the 1990s. These included:

a series of measures aimed at alleviating urban poverty and promotingincome-generating activities for the urban poor (e.g. supporting informalenterprises to improve productivity; vocational training and community

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activities; encouraging the participation of women in shelter financeinitiatives);

strengthening urban local government and administration by encouraging thedecentralization of powers and functions, and enhancing the capacity to plan,manage and finance urban development capabilities;

promoting the involvement of NGOs and CBOs;

providing urban infrastructure, shelter and services, especially to women andthe urban poor;

improving the urban environment through upgrading of solid-waste disposal,pollution control and slum upgrading programmes; and

promoting the involvement of the private sector in the provision andmaintenance of shelter and urban services.

UNCED was also influential on current thinking. Agenda 21 (United Nations,1993a) identified a number of important concerns which were relevant to humansettlements development and shelter provision. It calls on member states of theUnited Nations to:

improve the quality of human settlements management in order to ameliorateliving conditions, improve natural resources, support rural development andaccelerate national growth;

adopt national shelter strategies which support the efforts of poor andvulnerable groups; facilitate access to land, finance and building materials;reform codes and regulations; and promote the regularization and upgradingof informal settlements;

pursue integrated urban development programmes which encourageemployment generation measures for the poor through the provision,improvement and maintenance of infrastructure and services and supportinformal sector activities;

promote sustainable land use planning and management policies and inparticular urban land resource management plans;

promote integrated provision of environmental infrastructure and giveparticular attention to water-resources management, solid-waste disposal, andthe reduction of health risks from environmental pollution;

develop sustainable construction industries which utilize local materials andlabour-intensive construction methods; seek to render materials affordableand develop credit schemes to assist small builders;

increase public awareness of the need for sustainable development, promote

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training and human resource development; and

seek to develop guidelines and strategies to increase equality in society, toadvance the role of women and to develop partnerships in achievingsustainable development.

The conference was particularly effective in promoting the issue ofsustainability in human settlements development and increasing awareness ofenvironmental issues and the necessity for global action along these lines. A networkof 'sustainable cities' has since been established with the aim of sharing experienceand good practice on urban and environmental management.

The most recent contribution to this evolutionary process of strategic policydevelopment has been the World Bank's paper on shelter and the operation of thehousing market (World Bank, 1993c). The paper identifies a seven-point programmeaimed at operationalizing shelter strategies. This comprises:

the development of property rights through the regularization of tenure insquatter settlements and the privatization of state-owned housing;

the development of institutional housing finance;

the limiting and targeting of subsides;

continued improvements in the residential infrastructure for slum and squattersettlements and in servicing new land for urban development;

improving the organization and efficiency of the construction industry;

establishing regulatory audits to remove obstructive regulations which inhibitshelter development; and

developing appropriate institutional arrangements for managing the housingsector.

The paper signals a shift in the World Bank's lending policies in the housingsector, recognizing the wider role of housing in the overall economy. These changesare reflected in five guiding principles. The World Bank —

wishes to encourage governments to pursue an enabling role and to moveaway from the direct production, financing and maintenance of housingtowards "improving housing market efficiency and the housing conditions ofthe poor";

intends to shift its lending from single project assistance towards investmentswhich have greater sectoral impact, such as regulatory reform or institutionaldevelopment; when projects continue to be funded they will have todemonstrate an impact on the sector as a whole;

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will assist the development of private sector housing finance institutions;

will support the development of innovative lending models and housingproject design; and

will seek greater commitment to improved housing data collection andanalysis to aid policy formulation and implementation.

It is a great deal of consistency between the above discussed documents.Future emphasis is to be placed on improving the operation of essentially privatizedhousing markets. This is to be achieved by deregulation and support for institutionaldevelopment in the private sector, including housing finance institutions.Regularization and empowerment of the informal sector are to be important elementsin this process. Government agencies, both central and local, are to withdraw from adirect role in production, allocation and management in favour of an enabling role.Nonetheless, the urban management capacity of public agencies is to be enhanced,henceforth concentrating their attention on factors such as, reforming legal andinstitutional frameworks; improving the delivery of urban land and the provision ofinfrastructure; encouraging the development of partnerships; and promoting theshelter role of NGOs.

The World Bank states explicitly that a more efficient housing market willimprove the circumstances of the poor. The other policy documents discussedabove, however, advocate poverty alleviation programmes as part of integratedurban development programmes that will create income-generating opportunitiestargeted towards the poor, and especially women. For the poorest, both the UnitedNations agencies and the World Bank recognise the need for direct forms ofprovision both in terms of shelter and basic services and they have also tacitly cometo accept the use of targeted subsidies as part of these arrangements.

Shelter strategies themselves are to be integrated with other economic andsocial programmes; more effectively targeted to the needs of the poor; sustainableand mindful of environmental considerations; and capable of scaling-up to levels ofprovision more commensurate with actual housing needs.

These policies now represent the new 'received wisdom' in the shelter sectorfor the 1990s; moreover, they constitute a framework against which to assessrecently developed shelter programmes and projects for the urban poor.

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Chapter V. Reaching the urban poorB. The sites-and-services programme in Zimbabwe

On gaining independence in 1980 the Zimbabwean Government saw theprovision of an ultra low-cost core-housing programme on serviced plots asconstituting the cornerstone of its large-scale low-income housing programme. Forpolitical reasons, however, the government adopted higher standards than thoseprevailing before independence and three key principles were identified:

plots would be provided on an 'aided self-help' basis, i.e. self-build withtechnical and financial assistance;

the establishment of 'building brigades' for construction and the productionof building materials aimed at reducing costs; and

standards set at 300 m² plots with a core house of 50 m² comprising fourrooms with separate kitchen and bathroom/toilet. Road access, piped waterand waterborne sewerage facilities were to be provided to every plot.

The post-independence programme may be seen to have developed throughthree phases, an initial development phase to 1984; the consolidation of thisprogramme with three large scale World Bank funded schemes to the early 1990s;and a transitional phase with the introduction of partnerships, the relaxation ofcontrols and standards, culminating in the adoption of more modest minimumstandards in 1992.

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1. The mobilization of financial resources and the question of affordability

The initial phase was targeted towards those with incomes below the medianincome of those living in low-income, high-density areas (i.e. incomes of aroundZ$150 compared with a median income of Z$175). Cash loans were made availableby the local authority with assistance from the United States Agency for InternationalDevelopment (USAID). By 1984 more than half the plots had been completed,considerable private finance had been mobilized and the programme was broadlyconsidered successful.

Phase two involved an expansion of the programme to include World Bankfunding for over 11,000 serviced plots in four cities. Off-site infrastructure costswere to be recovered via tariffs (water, electricity, sewerage and waste management),and through rates and supplementary charges for roads and street lighting. On-sitecosts were to be raised through plot sales. Building society assistance with loanswas incorporated into this phase and variable rate loans were made available at 12.5per cent (at that time) over 25 years from a special fund generated from short-termfinance specifically for lending on low-cost housing. Plots were targeted to those onwaiting lists with income ceilings and other eligibility criteria. Because of rising coststhroughout the projects the income ceiling was increased, in Harare from Z$400 in1984 to Z$550 in 1989 thereby excluding nearly three-quarters of the households onthe waiting list. By 1991 official estimates indicated that in order to qualify for amortgage a minimum income of Z$900 was necessary. World Bank estimates ofaffordability, however, included both prospective rental income from sub-lettingrooms as well as reduced construction costs through self-help labour. As aconsequence, the plots in these schemes were allocated largely to those in the targetgroups, some of whom were relatively low income and waiting-list priorities. At thesame time, there was some evidence of malpractice in allocations, "the use ofinfluence, perhaps bribery, to secure allocations for employees of local authoritiesand their friends and relatives, allocation to households outside the low-incomegroups, and falsification of information, especially related to the length ofemployment in the City" (Rakodi and Withers, 1994).

Despite World Bank support, the supply of serviced plots in Harare started todecline after 1984/1985 and fell to little over one thousand per annum in 1989/1990(Mbiba, 1994). A shortage of government funds and the increasing costs ofsites-and-services schemes persuaded the government to seek other ways ofincreasing the supply. One of the most successful initiatives was a partnershiparrangement with major employers in the city. Employer assistance was sought withpaying the purchase price of the plot up front and recovering it either from theemployee's wages or directly from the building society. This arrangement enabledthe local authority to recover its outlay relatively quickly. At the same time, however,

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it was also hoped that employers would assume other responsibilities such as, theselection of suitable employees, providing top-up loans, the deduction of wages atsource etc., all of which would reduce the administrative burden on the localauthority.

These changes, introduced in 1989, ushered in the third phase of theprogramme. The partnership approach became a major element of the programmebetween 1989 and 1991 and increased the demand for serviced plots. Beneficiariesreceived various levels of support, such as bridging loans, assistance in hiring andsupervising builders, assistance with the provision and costs of materials, mortgageguarantees and concessionary rates of finance. The government introduced otherchanges too; it waived income ceilings for waiting list registration, and it sought cashbuyers for the disposal of plots. The effect of these changes was to alter completelythe client group for the serviced plot programme and by 1991 disadvantaged groupshad effectively been excluded, as purchasers, from the projects. Despite this, thecontinued adherence to high standards also meant high costs and by 1991 theaverage cost of housing and related expenditure in one scheme was 32 per cent ofincome. Sixty per cent of the households were paying more than the guideline figureof 27.5 per cent of income and 29 per cent paid more than 40 per cent of theirincome.

The remainder of the third phase of the programme coincided with a majordrought and the signing of a formal Structural Adjustment Agreement in 1991.Inflation increased from an average of 13.2 per cent per annum between 1980 and1990 to 42.1 per cent in 1992 and 21.6 per cent in the first six months of 1993. Thecost of living more than doubled between 1990 and June 1993, much of which washousing and related costs. By mid-1993 "there was evidence of a rapid and visibleprocess of impoverishment" (Rakodi, forthcoming). The effect of these increasedcosts was to decimate the low-cost housing programme and in 1992 the governmentwas persuaded to reduce housing standards dramatically. Minimum plot sizes werehalved to 150 m² and plinth sizes reduced from 50 m² to 36 m². This reduction, itwas argued, reduced overall costs by 29 per cent (Mbiba, 1994).

In retrospect, the cost of participation in these schemes in Zimbabwe hasalways been high because of the government's (and building society's), insistence onhigh standards. The affordability of the poorer groups for these projects, however,was steadily eroded over the 1980s and quickly eclipsed in the 1990s. In the early1980s it was estimated (Schlyter, 1989), that a third of the population were unable toafford to participate in the 'Assisted Self-Help' schemes; by the mid 1980s only 16per cent of households could afford a four room core house (Mutizwa-Mangiza,1988); and by 1991 at least 60 per cent of non-owner households could not afford aone room house.

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2. The social impact of the programme

The original hopes of the government — that the 'assisted self-help' low-costshelter programme would provide the cornerstone of its housing policy — have notbeen fulfilled. The programme has assisted only a fraction of those in housing needin the capital city, Harare. The programme provided 24,000 serviced plots between1980 and 1991. Since the mid-1980s, the gap between need and provision haswidened. In 1985 the Council's waiting list included 23,000 households and the Citywas servicing about 3,200 plots; by 1991 the annual supply of serviced plots hadfallen to a rate of just over 1,500, whilst the waiting list had climbed to 80,000households (about 400,000 people).

Has the programme been targeted on the poorest groups? To some extent ithas, but not in the way that was originally intended by the government. As wasshown in the previous section the targeting of the programme was directed atlow-income groups on the waiting list, before relaxations in the early 1990s led tochanges in the client group. The World Bank had always intended that the owners ofthe serviced plots programme should generate income in order to meet their costs bysub-letting rooms in their dwellings and although this was not approved of bygovernment officials nor the building society, it has actually taken place on asubstantial scale. In several schemes surveyed in the mid-1980s the majority ofhouseholders were sub-letting rooms and in one mature scheme the majority (53 percent) of households were lodgers. A comparison of owners and lodgers in thescheme showed that —"Owner household heads (were) ten years older than non-owners (42 compared to31), had households nearly twice as large (5.5 compared to 2.5), occupied largerdwellings (3.7 compared to 1.4 rooms), and lived in less overcrowded conditions(7 per cent with three or more persons per room and 21 per cent with two or morepersons per room compared to 18 per cent and 40 per cent of lodgers). Lodgersincluded disproportionate numbers of young, recent migrant and elderlyhousehold heads, female-headed households, single people and low-incomehouseholds (30 per cent had incomes of less than Z$400 compared to 13 per centof owners). In a wider sample of non-owner households, 19 per cent were below aroughly calculated poverty datum line adjusted for household size" (Rakodi andWithers, 1994).

Overall shortages of accommodation have meant that where turnover ofaccommodation has taken place this has generally been to households with higherincome levels. Turnover has taken place where the local authority has cancelled theagreement of sale because of serious arrears, or failure to complete the initialdevelopment of the plot in a certain time, an increasing problem throughout the1980s (Mbiba, 1994). It may also take place as a result of private sale; (no longer

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requiring the approval of the local authority). As yet a relatively small proportion ofplots has been ceded or sold, but survey evidence shows an increasing incidencesince the relaxation of local authority controls and that a majority of those moving inare in professional, managerial or supervisory occupations and have incomes twicethe average of original allottees.

Despite the growing problems of affordability associated with the servicedplots programme, the decision to reduce standards in 1992 has been controversial.Mbiba has complained that the "obsession with cost-minimization strategies on thesupply side" has ignored the costs of the utilization of the dwellings. He argues that,given the strategy to encourage sub-letting, "a unit meant for one household is inpractice inhabited by four households" with detrimental effects on the health andwelfare of residents. He is critical too of other aspects of declining standards, thatthe use of substitute materials will compromise the superstructure and infrastructureof the development; and that, at a time when the cost of living has recently doubled,that plot size reductions reduce the possibility for households to supplement theirincome by growing fruit and vegetables (Mbiba, 1994).

Some measure of support for his views is forthcoming from a survey of femalehouseholders renting their accommodation and conducted by Schlyter in 1989.About half of the households surveyed in Harare and nearly two-thirds of thehouseholds in Gweru were dissatisfied, mainly because of a lack of space andovercrowding, but also because of insecurity and the incidence of conflict withlandlords.

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3. Conclusions

Through the opportunities it has afforded for sub-letting, the serviced plotsprogramme in Zimbabwe has extended some provision to low-income groups,although the overall programme falls far short of the extent of need. In view of thegeneral shortage of accommodation, the relaxation of government controls hasreduced the capacity for targeting such programmes to low-income groups. Therelatively high standards have also meant that the developments are attractive tomiddle-income groups. Given current financial constraints in both public and privatesectors it is questionable whether the programme is either replicable or sustainable.The reduction in standards may make the programme more attractive to privateinvestors and institutions and ensure its sustainability. If, however, it is to continue tohave any relevance for the low-income groups, the arrangements for letting need tobe acknowledged, and more systematically planned in terms of dwelling design;provision for arbitration made in landlord tenant disputes; and safeguards introducedagainst the arbitrary eviction of tenants.

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Chapter V. Reaching the urban poorC. Brazil: the FUNACOM programme in São Paulo

The FUNACOM programme was one aspect of a radical political programmeintroduced by the newly electedPartido de Trabalhadores(Workers' Party) in theMunicipality of São Paulo between 1989 and 1992. The context for the introductionof this programme was threefold:

new central government legislation in 1988 devolving greater legislative andfinancial autonomy to five major Brazilian cities, including São Paulo;

the election locally in São Paulo in 1989 of the Workers Party, whichintroduced a new political direction to the management of São PauloMunicipality; and

the pre-existence of an influential local "Housing Movement" in Greater SãoPaulo (the UMM), consisting of many different CBOs, which effectivelylobbied for a decentralized programme of self-managed housing investment.

The Workers' Party adopted a comprehensive and participatory approach tothe problems of the city, including those of the informal (and illegal) settlements. Itencouraged a process of community negotiation in order to develop an Action Planfor the city, not only with a view to improving the overall environment, but also toachieve a more equitable environment. The new Action Plan comprised an urbanpolicy which was based on the mobilization and support of local communities; itintroduced a new regulatory framework for land-use, zoning and building standards;and it sought to mobilize financial resources through the restructuring of an existingfund ("the municipal fund to support housing for low-income people" — FUNAPS),and the redeployment of municipal resources; as well as seeking partnerships overland development with the private sector. The generation of local resources was seenas particularly important in that it preserved the independence of the municipalgovernment and its urban policies from the external pressures of the centralgovernment and international aid agencies.

The Action Plan included a number of shelter programmes; it sought toregularize informal settlements; it gave priority to relocation in sites-and-servicesprogrammes to those living in hazard-prone settlements, such as flood prone areas,or on land liable to slippage; it targeted squatter settlements and tenemental dwellingsfor upgrading and the provision of basic infrastructure; and it continued with theprovision of low-income housing using federal government resources. TheFUNACOM programme, encouraging mutual aid and self-management, was thusone of a series of programmes targeted towards the urban poor. It was established in1989 with the following specific aims:

to increase the institutional capacity of the municipality to manage housing

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programmes;

to reduce the cost of the provision of infrastructure and housing;

to promote autonomous community participation through self-managedprogrammes financed by the municipality; and

to strengthen community participation in the housing sector.

In essence, the programme allocated funds directly to the families involved inorder to improve housing and infrastructure facilities throughout the city. Thefamilies formed themselves into Community Associations (autonomously functioninglegal associations), and were assisted both in the formulation and implementation oflocal projects by Technical Assistance Teams. The projects, developed inconsultation between the Community Associations and the Technical AssistanceTeams, were submitted to FUNACOM for approval. Through this programme thecommunity not only decided on the nature and standards of local projects (e.g.rebuilding, local land adjustment and infrastructural provision), but was alsoresponsible for the management and allocation of finance and participating in theconstruction process.

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1. The mobilization and allocation of resources

FUNACOM was funded through FUNAPS. FUNAPS had been created earlierto finance the acquisition of land, infrastructure and building materials forlow-income groups and it was restructured to enable it to assist CBOs as well.FUNAPS' resources were mobilized from the municipal budget (nearly $100 million),from the repayment of loans, and from partnership arrangements over land usearising out of the new legal framework ($67 million). Whilst FUNAPS had not beenestablished by statute (a problem subsequently determined by the courts), it wasadministered by a council formed from representatives of the municipality and thecommunity, and run from within the "Housing Superintendency" of São PauloMunicipality.

In order to seek funding from the FUNACOM programme, a local communityhad to organize themselves into a Community Association and link up with aTechnical Assistance Team. Together they defined a draft programme and submittedit to FUNACOM. After preliminary approval, a final programme was prepared withspecifications, costings, and cash flow statements. Upon approval, a loanapplication was sent to FUNAPS and when this was approved the CommunityAssociation signed a contract with FUNAPS. The signing implied acceptingresponsibility for the management of the works to completion.

A loan ceiling of $5,000 per family was instituted for projects and the loan itselfwas divided into different percentages for the following inputs: building materials, 82per cent; hired labour (usually skilled), 10 per cent; site equipment, tools, etc., 4 percent; and Technical Assistance Team fees, 4 per cent. These percentages wereflexible in special cases. Both the percentages and the role of the TechnicalAssistance Team were set out in each project application and the CommunityAssociation was responsible for managing the financial arrangements. Loans werepaid in instalments (the first in advance), and on subsequent monitored progress.

Individual loan repayments were calculated taking account of monthly incomeand family size. Repayment terms were negotiable (between 5 and 25 years) and loanrepayments were to be not more than 25 per cent of income and not less than 10 percent. Subsidies were available according to family income.

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2. The organizational arrangements and the process of self-management

As indicated earlier, one of the conditions for the Community Association toobtain funds was to contract an independent Technical Assistance Team to assistwith the formulation and implementation of a local project. The Technical AssistanceTeams were:

independent of the local government;

associated with, or contracted by, a Community Association;

multi-disciplinary, and able to provide technical assistance in the fields ofengineering, finance and with the legal aspects of development; and

identified with the social and political values of the Housing Movement(UMM).

The Technical Assistance Teams were obviously important in indicating to theCommunity Associations what the possibilities for development were within the costlimits available. The programme was flexible, however, to enable standards to bedetermined locally by the Community Association, and to develop local solutions tolocal problems. The Technical Assistance Teams often undertook training formembers of the Community Association, supervised the actual construction works,and gave advice and guidance on the establishment of income generating activities.

In getting established the first task was the conceptualization of a local project.This involved considerable discussions between the Technical Assistance Teamsand Community Associations. After approval of the initial submission, the detailedarrangements were worked out. Next came the definition of the construction processand agreement on building regulations and the principle of mutual help. This involvedreaching agreement over tasks such as:

the expected number of hours per week that each household should work;

allocation of working hours between family members and minimum time to bespent on site;

rules governing the use of equipment and access to materials;

the role of the Technical Assistance Team, the foreman and the workcoordinator;

sanctions in case of negligence; and

distribution of houses among members of the Community Association.

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Many Community Associations also designed and built community facilitiessuch as crèches and community centres, as part of the programme. These werefinanced by FUNACOM. The nature of the work demanded widespread communityorganization and a strong sense of solidarity and responsibility amongst members ofthe community. The participation of workers was an integral part of the programmeboth in terms of determining the nature of the project, and in working towards itsimplementation.

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3. The impact of the FUNACOM programme

Designed very much in line with the key principles of the GSS, the São PauloMunicipal programme for shelter was very effective in targeting the urban poor. Overthe 19891992 period it is estimated by Guedes and Devecchi that 250,000 familieswere involved in regular discussions about the Action Plan and that the variousshelter programmes funded from local sources secured the following achievements:

squatter settlement upgrading: 47,000 families;

tenemental upgrading: 481 families;

sites-and-services with core housing: 7,700 families; and

the self management and mutual aid programmes: 10,600 families.

In addition, the low-cost shelter programme using Federal resources assistedmore than 25,000 families over the same period.

At the ideological core of the shelter programmes was the FUNACOMprogramme, tangibly demonstrating the benefits of mutual help and communitymobilization in shelter provision for the urban poor. Denaldi (1994), and Guedes andDevecchi (1994), have itemized their perception of the strengths and weaknesses ofthe programme. The 'strengths' included:

a successful enabling framework: the FUNACOM programme enhancedsecurity of tenure and provided a legal, technical and financial frameworkwhich enabled the process of self management and mutual aid effectively totarget the shelter and environmental conditions of the urban poor;

the programme was effective in raising 'collective consciousness' over shelterand environmental issues; it extended the coverage of communityassociations, strongly promoted the role of women and genuinely mobilizedsupport for the programme amongst the poor;

this high level of community participation and the decentralized nature of theprogramme ensured that the most pertinent issues confronting the urban poorwere addressed and that the programme effectively countered problems ofpolitical patronage;

it was effective in local capacity building; it strengthened local organizationaldecision-making, raised the level of skills and competencies, and increasedthe opportunities for local economic development;

the localized nature of the projects and the flexibility of the programme

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resulted in appropriate choices of standards and technologies, according tothe preference, necessity and affordability of each community;

the role of the Technical Assistance Teams ensured autonomy; promotedparticipation and complemented the local authority role; and

the local authority itself adopted decentralized procedures and accepted localdecision-making; it also began to develop public-private partnerships overland development.

They perceived the major weaknesses of the programme to be:

its lack of sustainability; the strong political support of the Workers' Partywas both a strength and a weakness, the loss of office of the Workers' Partyin November 1992 has subsequently revealed the vulnerability of theprogramme to political change;

the inability of the Workers' Party to secure lasting legal and institutionalreforms; whilst far-reaching legal reforms were introduced, the politicalopposition, systematically (and successfully), obstructed the adoption ofthese reforms in the Municipal Chamber;

the weakness and lack of competence of some of the Technical AssistanceTeams contributed to the difficulties of implementation of the programme;and

the bureaucratic procedures required by the municipal authority wereinsensitive to the need for change and resulted in instances where they werecircumvented by informal procedures.

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4. Conclusions

The FUNACOM programme, as part of the overall shelter programmes initiatedby the municipal authority of São Paulo between 1989 and 1992, achieved muchgreater success in targeting the needs of the urban poor than previousadministrations. The programme was seen as an ideological one, however, and wasunsuccessful in obtaining the political support of opposition parties and the privatesector as a whole. It was able, however, to mobilise local communities to participateeffectively and to generate substantial local resources to improve the living andenvironmental conditions of the urban poor.

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Chapter V. Reaching the urban poorD. An evaluation of the Employees' Housing Programme (EHP) in the Republic of Korea

The economy of the Republic of Korea has grown from a mainly agriculturalone in the 1950s to a mainly industrial one today. GNP per capita has grown from$87 in 1960 (Kim, W-J., 1994) to $7,660 in 1993. The economy has grown by anaverage of 8.2 per cent per year during the 19801993 period, the highest of all thecountries listed by the World Bank (1995a). The emphasis of government policy hasbeen to ensure continued high economic growth. Despite the success of theeconomy, however, direct government investment into housing has, until recently,been relatively modest, ranging from 3 to 4 per cent of total expenditure between1980 and 1988. With the advent of a major house construction programme aimed atbuilding two million units between 1988 and 1992 this proportion of expenditureincreased to more than 7 per cent in 1989 (Kim, W-J., 1994).

One of the major structural changes in the Republic of Korea — occasioned bythe long term success of government economic policies — has been the formationof a large urban industrial workforce. This has been made possible by large-scalerural-urban migration. In fact, the urban population of 1995 accounts for 81.3 percent of the total population. Housing provision for these workers has largely been inthe private sector (62.3 per cent of new housing construction was by the privatesector between 1965 and 1990), much of this is privately rented accommodation, orin flats and dormitories provided by industrial companies for their employees. Infact, by 1990 a total of 55 per cent of all urban households tenants (Kim, W-J.,1994).

Continued serious shortages of accommodation have resulted in successivewaves of intense speculative activity in both house prices and land costs. Between1971 and 1978 house prices increased by a multiple of 19 whilst incomesquadrupled; and the price of urban residential land in Seoul rose on average by 1582per cent between 1979 and 1985 (Kim, J-H., 1994). Continuing difficulties of accessto the housing market persuaded the government to launch a major houseconstruction programme in 1988 aimed at providing two million units ofaccommodation before 1992. Moreover, the fear that speculative activity in urbanland was likely to undermine this programme also drew the government into stronginterventions in the land market in 1989. A series of legislative measures imposed aceiling on urban land ownership in the major cities; levied property taxes on themarket value of real estate; and introduced capital gains tax on corporate landholdings to discourage hoarding and release land for development.

As part of the two million units programme, the government launched the EHPin 1990 to relieve instability in the rented market and to improve housing quality forindustrial workers.

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1. The resource base for the EHP

Over 1990/1991 almost 100,000 units were constructed under the EHP. Bothhousing for sale and housing for rent were provided by local government, theKorean National Housing Corporation (KNHC) and private builders (see table 54 ).

The programme was administered by local authorities and the eligibility criteriawere an income ceiling for targeted households of K$1,250 per month; or more than10 years service in the industry; and a targeting of workers in the manufacturing,transportation, coal mining and cleaning industries.

For those that wanted to purchase a house, loans of up to K$17,500 per unitwere made available to householders to set against a purchase price of aboutK$30,000. These loans were repayable over a 20 year period at an annual interestrate of 8 per cent. Loans of K$18,750 per unit were made available to industrialcompanies to provide rental housing for their employees. Priority was to be given tosmall businesses.

In financial terms the programme has been very beneficial for those who havequalified. Housing expenditure for those in rented housing has been reduced bymore than 50 per cent on average, whilst for those purchasing their housing, theincreasing asset value has more than offset the imputed rental value of the heftydeposit required. Nonetheless the relatively high cost of housing for sale has limitedthe participation of low-income workers. A monthly payment of K$250 is needed,for example, for loans and if a housing expenditure ceiling of 30 per cent of incomeis assumed, this implied a monthly income of about K$830. Yet, the average incomeof industrial workers was only K$700, and 55 per cent of small company employeesearned less than K$500. This has meant that whilst the workers from smallcompanies have less ability to purchase housing and therefore a higher need forrental accommodation, the smaller companies have less capacity to manage rentedhousing programmes.

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2. The social impact of the EHP

Apart from reducing the housing costs of beneficiaries, the programme hasgreatly improved their housing conditions in terms of the amenities available, forexample, the availability of kitchens, bathroom and heating methods. As far as size isconcerned the units were relatively modest at 5056 m², and whilst on average the sizeof apartments has increased from 4552 m², 30 per cent of residents haveexperienced a decrease in the space available over their previous accommodation.

At the same time, the programme has improved the residential stability of thebeneficiaries, who mostly lived in privately rented dwellings, in company housing, orin dormitories before moving into the EHP. A four year rental period is common forthe rental housing which significantly improves residential security. It remains to beseen if this is also the case for those purchasing their housing. Since purchasers areable to resell on the open market after just two years, it was anticipated — becauseof the highly subsidized nature of the programme — that this would result insubstantial potential financial gain, thus encouraging the beneficiaries to sell.

The programme has received some criticism for the modest space standardsconstructed. Whilst there is a maximum limit of 60 m², the size of developments hasvaried and many units have been built at less than 45 m². The average size ofworkers' households, however, is 5 persons. The programme has therefore restrictedaccess to smaller households, and in approximately 50 per cent of cases somehousehold members were excluded when they moved into the EHP. Other eligibilitycriteria have led to the exclusion of younger households both on grounds of costand the requirement of having been employed for a 10 year period. Many workers'households are also excluded from consideration because of the targeting of specificsectors of industry.

Finally, there have been some difficulties with the location of certain sites.Because of the difficulty of acquiring low-cost land, some large scale housingcomplexes have been constructed on peripheral sites and there is insufficientdemand to fill them because of the inconvenience of their location.

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3. Conclusions

The EHP has been very beneficial for those fortunate enough to have qualifiedfor it. They have seen their housing costs and rents fall whilst the quality of theirhousing and environment has substantially improved. Yet, despite a high level ofpublic subsidy, the EHP is not reaching the low-income groups. The costs remaintoo high. Other eligibility criteria have also led to the exclusion of low-income groupsfrom the programme.

The majority (72.5 per cent) of the housing units have been constructed bycentral or local government agencies and the rest by private builders. The privatesector has been limited in this way because of the high taxation levels on land forprivate sector agencies wishing to construct houses. At the same time the partnershipwith private industries over housing for their employees has only been partiallysuccessful. Small companies in particular are in a double-bind, their employees areinvariably unable to afford the costs of home ownership whilst the companiesthemselves have limited capacity to manage rental housing schemes.

A further 500,000 units are planned to be developed between 1992 and 1996; itremains to be seen whether the government will relax the eligibility criteria orintroduce other mechanisms to encourage the participation of small businesses andextend coverage of the programme increasingly to meet the needs of low-incomegroups.

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Chapter V. Reaching the urban poorE. India: An evaluation of a series of Slum Improvement Programmes

In 1991 it was estimated there were about 48 million slum dwellers in urbanareas in India and 40 per cent of these were concentrated in the metropolitan cities.For many years the Federal and State governments have pursued programmes aimedat upgrading and relocating slum settlements. In the late 1960s and early 1970s slumsettlements were an emerging phenomenon and were regarded as 'unfit' anddeplorable environments and were subjected to clearance and relocationprogrammes. These schemes were expensive, insensitive to the needs of slumdwellers, and the forcible clearance operations were widely despised by slumdwellers and civil servants alike.

In 1972 the government adopted a different approach by introducing thecentrally sponsored EIUS programme. The underlying objective of these schemeswas to provide collectivized basic services in slum settlements. Thus 100 per centgrants were available, calculated on a per capita rate, for the provision of watersupplies, community sanitation, drainage, paved pathways, street lighting, etc. Whilstthe scheme provided for the acquisition of private lands, the states and municipalitieshave concentrated on the improvement of slums on public land and only inexceptional cases have these schemes been extended to private landholdings (e.g.Calcutta and Kanpur). The state governments have not followed a uniform policyover EIUS, however. Some state governments have passed legislation to ensure asystematic approach to the problem, whilst others have pursuedad hocpolicies andprocedures.

Evaluations of the EIUS scheme have offered a series of criticisms:

the projects have tended to be rigid and inflexible, with a social welfare andpaternalist orientation;

rarely have the prescribed standards actually been met, due to locational andcost constraints;

there has been insufficient funds to tackle the programmes on an adequatescale;

no workable arrangements are devised for the management and maintenanceof EIUS schemes;

slum communities have not been involved in discussions about the standardsof provision or the maintenance of the services;

there has been no concern for the convergence of other basic services orassistance with actual home improvements; and

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no steps have been taken to incorporate the slum settlements into the overallplanning and infrastructure framework of towns and cities (Shah, 1994).

Accordingly, when World Bank assisted Slum Upgrading Programmes (SUPs)were adopted during the 1980s, some of these criteria were addressed in a moreambitious approach:

a more comprehensive perspective towards urban development has beenadopted, in which SUPs are orientated towards the upgrading of slums in anentire town or city;

the legalizing of the status of slum dwellers has been a major step forward,thus creating the opportunity for further investment and development in slumsettlements;

the provision of services has improved on the 'Spartan' standards of EIUS,including the opportunity for home improvement loans;

the involvement of the slum dwellers is sought and encouraged at each stageof the programme; and

unlike the 100 per cent funding provided by EIUS, however, the WorldBank-assisted schemes are entirely on the basis of loan finance, and a strongemphasis is placed upon full cost recovery.

Like the EIUS programmes, however, the actual implementation of theprogrammes has not met with the conceptual expectations. There are difficulties overcost recovery. These difficulties range from the practical, where local authoritiessimply do not have efficient mechanisms for cost recovery; through the political,where politicians may 'defend' the interests of a community over non-payment inreturn for its support; to the ideological, where communities used to highlysubsidized, state-led programmes are not convinced of the need for repayment.Issues of land tenure are proving more complicated than anticipated. The acquisitionof private lands is expensive for municipal authorities starved of resources; theredesignation of use of public lands a lengthy and bureaucratic exercise; and at thelevel of the slum communities themselves there may be some negative reaction to theenhanced liabilities (such as property taxation), which the 'advantages' of ownershipmay bring (Shah, 1994). Experience from various SUPs also shows that, on thewhole, the process of decision-making is still not vested with local communities andsuch tokenism can lead to indifferent levels of community participation during theimplementation of projects.

Within this context, another series of continuing Slum ImprovementProgrammes has been undertaken in a partnership between the ODA, theGovernment of India and a number of state governments.

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1. The scope of the Slum Improvement Projects (SIPs)

The SIP programme was initiated in Andra Pradesh with ODA support for thewell-known Hyderabad Urban Community Development Project. The municipalauthority effectively adopted a community development approach to a city-wideslum-improvement programme. To this was added, firstly, the support of the UnitedNations Children's Fund (UNICEF) for its Basic Services Programme, andsubsequently the support of ODA, in providing a substantial grant for physicalprovision, and additional inputs for health, education and other socio-economicprogrammes. This integrated approach was extended to two other cities in the state(Visakhapatnam and Vijaysawada), before subsequently being extended to Calcutta(West Bengal) and Indore (Madhya Pradesh). The scope of the projects may beseen from the objectives of the Indore SIP (1989) which seeks to:

integrate the slums into the economic and social networks of the city;

improve physical living conditions for some of the poorest urban families;

increase standards of health, literacy and basic education;

increase income-earning potential;

develop community organization and institutions;

provide security of tenure;

encourage self-help improvement of housing;

strengthen local government, NGOs and the slum communities to ensure thatthe assets created are properly maintained and the project benefits aresustained; and

improve housing conditions in areas adjacent to the slums, and lead to ageneral improvement in health standards in relation to water-borne diseases inthe city as a whole.

Whilst these are indicative of the aims of all five projects, each one is part of anevolutionary approach, adapting to experience of good practice and to differing localcircumstances. The projects thus have wide-ranging briefs, not merely to improvethe physical infrastructure and environment, but to increase the earning capacity ofslum-dwellers and their quality of life through other health and educationalprogrammes; to develop local organizational capacity to assist with the delivery ofprogrammes through community development and leadership programmes(especially with regard to women); and to establish systems and procedures for the

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maintenance of the projects and their future sustainability.

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2. The social impact of the SIP projects

Whilst, for the most part, the SIP projects have been effectively targeted on theurban poor, there has been some criticism that the projects have used slumsettlements as a proxy for the settlements of the poor. The selection of slumsettlements was largely left to the local authorities and, as a result, has concentratedon 'unobjectionable slums' rather than those in the worst condition. The projects didnot make any particular provision for pavement dwellers, moreover, despite the factthat the National Housing Policy (Government of India, 1992b) sees them as a moreurgent priority for attention than slum dwellers. A further related criticism is thatwhilst one of the aims of the projects is to integrate the slums into the economic andsocial networks of the city this cannot be achieved whilst they remain asrecognizable 'projects'; rather they need to form part of a city-wide povertyalleviation strategy. This means integrating the projects into the economic andemployment strategy of the cities just as much as it does ensuring they are part of thephysical planning framework, or an integral part of the city-wide network ofinfrastructure.

Owing to the differing regulatory frameworks concerning the notification andregulation of slum settlements in the different states, the SIPs have not been able toexercise a consistent policy over the conferment of occupancy rights. This is soeven despite the fact that security of tenure is widely acknowledged as crucial to thesustained enjoyment of the benefits of the projects and to the prevention of theinvoluntary displacement of existing occupants. At the same time, the stategovernments differ over the assistance given to householders in the form of loans forhouse improvement. These variations in the application of policy have resulted indifferent outcomes as far as housing upgrading is concerned. In Indore — wherethere is very progressive legislation for the regularization of the occupancy of slumdwellers on public land, and assistance with loans towards housing improvement —there has been a much higher level of induced private investment than in Calcuttawhere there is confusion over occupancy rights arising from a three tier tenancystructure and no organized assistance for housing loans. This stresses the need for asystematic policy framework towards housing for the poor.

A further problem has arisen over infrastructure costs. The costs have variedacross the five projects. In all cases, however, they are above the per capita norm(of Rs.525) for the EIUS schemes, sometimes by as much as five times. Incircumstances where the projects do not afford comprehensive coverage of slumsettlements this raises the question of the opportunity costs of more intensiveexpenditure in some areas than others and the political difficulties which this maygenerate. The extent of the difficulties is underlined by the fact that the financialallocation towards just one city in the SIP programme is roughly equivalent to the

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planned expenditure commitment of the Madhya Pradesh Urban WelfareDepartment, which is responsible for slum improvement, rehabilitation of thelandless, urban employment and municipal strengthening across the entire state, overa similar time period.

To the problem of costs is added a complication over implementation. Thereare now three 'models' for slum improvement in operation in India (EIUS, theNational Plan Programme; the World Bank schemes; and the SIPs). EIUS and theSIPs are both grant based schemes whilst the World Bank's programme promotesfull recovery of costs on land and infrastructural investment. Where two or more ofthese programmes are operating simultaneously in the same state this can lead tounnecessary confusion between bureaucrats and beneficiaries alike.

An overall evaluation of the components of the SIP projects reveals variedoutcomes from genuinely successful innovation through to some disappointments.Founded very much on the principle of community participation, this has been avery prominent and successful feature of the projects. In each case a very extensiverange of community initiatives and activities has been developed and where projectcompletion is nearing, arrangements are underway for local neighbourhood councilsto assume substantial responsibilities for the continuing management of theseinitiatives. In the earlier projects, now nearing completion, the major challenge is tosustain this wide range of activities once the formal funding for support staff hasended. This issue of sustainability is also receiving greater attention in the laterprojects.

As far as infrastructural provision is concerned, apart from the general problemover costs already mentioned, these programmes appear to have been successfullyimplemented. The Indore SIP, however, has been particularly successful in both thedesign and implementation of an innovative infrastructural system. This has beendesigned to lower costs, reduce the maintenance responsibilities of the municipality,whilst increasing those on the community, and to permit the phased linkage of slumsettlements to the overall infrastructure network of the city.

Where relocation programmes have been undertaken, however, these have metwith mixed success. A recent review of the relocation component of schemes yet tobe undertaken has concluded a need to bring thinking more into line withrequirements to consolidate, wherever possible, in-situ solutions to the problems ofslum settlements.

The health and education components have also been successful, and someextremely so. Again, the major concern is over sustaining the levels of provision andservice delivery which has been achievable under an externally funded projectoriented framework when this organizational structure is replaced by the mainstreamservice delivery programmes of the statutory and voluntary services.

The weakest component of the projects has been the Economic Support

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Programmes and it has been clear that this is an area where there is least experience.Whilst a range of training and enterprise initiatives have been established; revolvingloan funds set up and small loans disbursed; and expertise and advice from a rangeof institutions mobilized, the success rate in micro-enterprise development has notbeen good and experience with loan recovery poor. More recently, the projects havetended to move away from revolving loan funds towards the encouragement of thriftand credit cooperatives and towards more active links with local businesses. Themajor difficulties appear to be a lack of experienced staff; and absence of a strategicframework for training and employment initiatives, given that these initiatives oftenbegin in a policy vacuum without an informed knowledge of the nature of the localeconomy or the operation of the local labour market.

Two further issues are raised by the projects, the first is the question ofsustainability and the second, the replicability of the projects. As the earlier projectsare now nearing their formal completion it is evident that there are likely to be someserious problems in continuing the sustainabilty of some elements of the projects asdelivered so far. Some components, such as infrastructure provision, require a majorinvestment and thereafter there is the question of maintenance; other components,like some health and educational projects, are continuing and the absence ofcontinued funding calls in question their future continuity. This is a major problemwith externally funded projects. The second issue is the related one of replicability. Itis evident that the projects have developed a strong and independent organizationand framework which, in some instances, has neither been properly integrated withthe local state and municipal administrative structure, nor with the norms andprocedures of indigenous programmes such as EIUS and the Urban Basic ServicesProgramme. Discussions are currently underway between the Government of Indiaand ODA as to how continuing support for slum upgrading programmes can bemore effectively integrated within administrative and legal frameworks, whilst at thesame time adding support to the Government of India's strategic approach to urbanpoverty alleviation.

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3. Conclusions

The SIP schemes illustrate both the strengths and weaknesses of theproject-oriented approach to slum improvement and poverty alleviation. On the onehand the projects are well organized, adequately funded and are able to deploystaffing levels and adopt norms and expenditure levels which are able to impactpositively on the quality of life of the beneficiaries. On the other hand, the projectsare selective rather than comprehensive, they tend to develop an independentmanagerial orientation and the different norms and standards tend to be difficult tosustain and replicate when the projects come to an end.

To overcome some of these problems, more comprehensive city-wideprogrammes could be developed, rather than localized projects. This would ensurethat programme staff are accountable within the existing administrative and legalframeworks; that the main thrusts of policy are consistent with strategic approachesof the government and municipal authorities; and that norms and expenditure levelsare agreed in such a way that they do not create problems of opportunity cost forthe future.

The SIPs however, have been important and innovative projects which haveencouraged effective partnerships between statutory agencies (at state and municipallevels), NGOs and local communities to tackle physical, social and economicproblems in a series of slum communities. The projects have demonstrated theimportance of sound leadership and local political support. Whilst not allcomponents of the projects have been successful, the systematic monitoring of theprojects has enabled adaptation and modification from one project to another andhas enabled an evolutionary development over time. The SIPs offer invaluableexperience for others undertaking programmes of slum improvement and urbanpoverty alleviation.

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The Human Settlements Conditions of theWorld's Urban Poor

Chapter V. Reaching the urban poorF. Conclusions: Assessing the experience of projects/programmes aimed at improving the

human settlements conditions of the world's urban poor

In a review of international experience of the extent to which governments wereintroducing enabling strategies, UNCHS (1991c) observed that, "many countrieshave responded positively to the GSS and have already started to implement itsrecommendations in a wide range of areas". It also goes on to conclude that, "mostgovernments find themselves in a transitional stage in housing policy, somewherebetween the old emphasis on production and direction and the new enablingapproach of the GSS" (UNCHS, 1991c). This certainly remains true for this report.The evidence available, both in the review of human settlements conditions inchapter IV and the more detailed case studies above, suggests that governmentscontinue to acknowledge the importance of GSS. Yet, in the light of widespreadeconomic austerity throughout much of the developing world economiccircumstances are hardly propitious for an expansion of the role of the privatesector. At the same time, the impact of SAPs and other macro-economic reforms onthe public sector has also meant that governments have, in most cases, yet to get togrips with the task of developing coherent enabling frameworks for shelter and urbandevelopment.

The four case studies above reflect different levels of government commitmentto the concept of the enabling shelter strategies. The FUNACOM programme in SãoPaulo was clearly part of a significant and concerted attempt by one of the largestmunicipal authorities in the world to adopt many of the principles of the GSS. TheSIP programme in India has been constructed around a community developmentapproach which strongly embraces the idea of enablement. State agencies inZimbabwe also demonstrated a willingness to liberalize many aspects of theirapproach to the delivery of sites-and-services projects before the programmesuccumbed to the twin problem of economic austerity and a severe drought. Even inthe Republic of Korea, where evidence from the case study might demonstrate thatthe commitment to enablement is least, there is evidence of a conscious attempt toinvolve the private sector both in the construction and management of low-costhousing. Both the SIP programme in India and FUNACOM in São Paulodemonstrate progressive attempts to develop coherent local shelter strategies withinan enabling framework and whilst the São Paulo strategy foundered because theWorkers' Party failed to secure continuing political support, the SIP programme(although project-based rather than a wholly strategic programme), is still able toevolve and develop because of its universal political support. This underlines aprevious observation by UNCHS (Habitat) that,"sustained political will is an essential ingredient in the success of any majorpolicy change. To be effective, the GSS has to be supported at the highest levels ofgovernment over successive administrations" (UNCHS, 1991c).

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Three of the four case studies also demonstrate that government bodies, bothcentral and local, are taking cognizance of the advice given by the internationalagencies to withdraw from direct state provision in the housing market. Consistentwith the findings of the UNCHS (Habitat) study (1991c), however, it remains thecase that although these municipal bodies have played, and will continue to play, animportant role in the development of local shelter strategies, there is a long way to gobefore these roles may be regarded as fully fledged and coherent enabling roles.

A second fundamental characteristic of the new orthodoxy is the developmentof partnerships between municipal bodies, NGOs and local communities in order tosecure and enhance low-cost provision for low-income groups. Such a partnershipwas the central feature of the FUNACOM programme, although it was evident thatthere were some difficulties in changing attitudes and procedures within themunicipal bureaucracy in a short period of time. There were also problems inmobilizing the technical resources through NGOs on a scale commensurate withneeds across a highly decentralized programme throughout the city. The SIPs inIndia were founded on a community development approach and the replicability andcontinued success of this approach has been the major feature of these programmes.It has generated community-based initiatives on a broad scale and across a widerange of activities in each of the projects. There has clearly been less of a role forcommunity participation in the formulation and implementation of thesites-and-services programmes in Zimbabwe and in the EHP in the Republic ofKorea. Partly as a consequence, neither programme has succeeded in effectivelyreaching the low-income groups, save indirectly, in the case of Zimbabwe, throughthe sub-letting of properties.

A third important criterion is the enhancement of the role of the private(commercial) sector. This is currently one of the least developed areas within theconceptual framework for local strategies. "For the poor, there remains littlealternative but to rely on one's own resources or to use informal sources of finance"(UNCHS, 1991c). Evidence from the case studies above demonstrates that in eachexample efforts have been made to involve the private (commercial) sector in theseshelter initiatives for low-income groups, but with limited success. In São Paulo, themunicipality entered into partnerships with the private sector over land development;in Zimbabwe, the municipal bodies sought partnership arrangements with thebuilding society for private sector loan finance and with private employers forassistance with a range of administrative tasks; cooperation from employers wassought in the EHP programme in the Republic of Korea; and in India, the SIPs have(latterly) sought assistance from private companies with regard to training andenterprise development. Thus, private sector cooperation has been sought across arange of activities relevant to these shelter initiatives. None may be described ashighly successful, however, and attempts by the government in the Republic ofKorea to encourage small companies to assist with the EHP for the low-incomegroups have failed. The reason was affordability problems and the lacking capacityof small firms to provide housing management. Meanwhile, in Zimbabwe the

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involvement of the private sector and the liberalization of local authority controlsfurther exacerbated the difficulties encountered by the municipalities in trying totarget low-income groups in an increasingly expensive scheme and led eventually tochanges in the socio-economic composition of beneficiaries. From the case studies,however, there is little indication of progressive developments in the enhancement ofthe institutional capacity of the private sector to assist low-income groups.

The promotion of self-help in low-cost construction and materials production isa further important component of effective low-cost shelter strategies. This was astrong feature of the FUNACOM programme with local Community Associationsnot only determining appropriate standards and materials, but also undertaking themajority of the construction work themselves. This helped to raise confidence,encouraged the development of skills, and created opportunities for local economicdevelopment involving construction and the provision of materials. A similar processis also being undertaken in the SIP programmes and, although local circumstancesdiffer from project to project, the physical upgrading of shelter and the environmentusing self-help initiatives is at the core of these programmes. Where these initiativesare supported by regularization of tenure, loan finance for upgrading, and trainingprogrammes for construction skills, they have been particularly successful. Therewas also scope for self-build activities in the sites-and-services programme ofZimbabwe, and the establishment of 'building brigades' was intended to assist withthe production of building materials and reduce costs. Although the self-buildapproach worked well in the initial phase, the building brigades were not a successand the rising cost of materials was a major factor in undermining the affordability ofthe scheme for low-income groups; and as the higher-income groups replaced thoseon low incomes, the principle of self-building became less relevant. There is little, ifany, scope for self-help activity in the EHP programme in the Republic of Korea.The review of human settlements conditions in chapter IV confirms that formalhousing provision is rarely accessible or affordable for the urban poor and a similarconclusion may be drawn from two of the case studies. Hence, the GSS urgesgovernments to formulate explicit shelter policies for the poor. There has beenincreasing recognition in recent years, moreover, that women, and women-headedhouseholds in particular, are disproportionately represented amongst those living inpoverty (see chapters II and IV). Hence shelter policies need to demonstrate thatthey are responsive to the particular needs of women and children as well as to thoseon low incomes. Certainly the FUNACOM programme and related shelter policies inSão Paulo and the SIP programme in India, demonstrate approaches which are moreeffectively targeted and responsive to the needs of the poor and to women's needs,than conventional government provision. Both programmes involved the confermentof legal title in squatter settlements (although this has not been universally appliedthroughout the SIP programme), and the FUNACOM programme was one ofseveral simultaneous policies which were responsive in different ways to the shelterneeds of the poor in São Paulo. Other related programmes included tenementalupgrading in central areas, squatter settlement upgrading in peripheral areas linked torelocation programmes involving sites-and-services schemes where in-situ upgrading

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was considered unwise in view of the dangerous nature of the existing site, and alow-cost new build housing programme. The SIP programme is also moreeffectively targeting the poor than conventional housing programmes, but the projectapproach has been seen to be a drawback in the effective targeting of the verypoorest groups. Despite focusing on slum settlements, the SIPs have been criticizedfor failing to include all slum communities within their purview and, at the same time,for excluding consideration of pavement dwellers, street children and otherdestitutes.

Both programmes have also been responsive to the practical needs of women,involving them fully in the formulation and implementation of local activities. But asUNCHS (1991c) points out, it is much more difficult to make progress with regardto the institutional and market inequalities which exist and which inhibit or precludethe ability of women to hold land titles, to take loans, secure training or to obtainjobs.

The sites-and-services programmes in Zimbabwe, whilst originally successful intargeting the poor, have over time become a contradiction. The building standardsrequired have become increasingly unaffordable for the low-income groups. Therealso appears to have been a policy vacuum over the issue of sub-letting. The resulthas been that many of the practicalities of renting have not been considered in apurposeful way and large numbers of those renting were dissatisfied. Furthermore,the throughput of serviced plots has been very small in comparison with housingneeds.

Despite high levels of subsidy, the EHP programme has not been successful intargeting low-income groups because the costs remain outside their affordability.The eligibility criteria applied to the programme have also limited the access of thepoor. Governments should ensure that shelter provision and upgrading is combinedwith infrastructural investment, with local economic development initiatives, and withhealth, educational and welfare provision to enable a concerted, and integratedapproach, to urban poverty alleviation. Of the case studies, the SIPs most clearlydemonstrate the advantages of this approach, but there is little doubt also that theproject orientation and framework of the SIPs has been a constraint in seeking thebroader objective of attempting to integrate slum settlements more effectively into thephysical, social, economic and political networks of the city as a whole. Such anapproach needs to be developed over time and involves the development ofpartnerships across areas of traditional expertise. In São Paulo, whilst theconceptualization of local development activity was broadly based, involvingimprovements in infrastructure and to community facilities, it is not clear whether afully integrated strategic approach was adopted. In the remaining two case studiesthe targeting of the housing programmes on the low-income groups (at least in thelatter stages of the Zimbabwe programme), was not effective, thereby precluding anyattempt at an integrated approach towards urban poverty alleviation.

Agenda 21 (United Nations, 1993a) has increased the emphasis on two further

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requirements for the formulation of shelter strategies. It encourages a greater concernfor environmental issues and a recognition of the need to develop strategies whichwere sustainable. Certainly the aim of each of the case study programmes has beento improve the quality of housing and environmental conditions of beneficiaries. Byconcentrating on existing slum settlements often devoid of infrastructural provision,the upgrading programmes in São Paulo and the SIPs in India have tackled theproblems of environmental degradation directly, and by adopting self-helpmechanisms have been particularly cost-effective as well as successful in mobilizinglocal communities around issues of shelter and the environment. These programmeshave also encouraged the use of locally available low-cost materials therebyincreasing the potential for employment creation and generating a beneficial impactfrom local income multipliers.

The issue of sustainability, however, is a complex one. The FUNACOMprogramme, along with other shelter programmes in São Paulo, although evincingmany of the characteristics of an environmentally sensitive and sustainableprogramme consistent with the GSS, was unsustainable because of local politicalchange. There are also difficulties with the sustainability of the SIP programmes butfor very different reasons. The external resourcing of the SIPs and the subsequentdevelopment of an independent managerial orientation has meant the projects haveadopted staffing levels and norms and standards which will be difficult to sustainonce the major capital funding stage has concluded and local statutory bodies beginto assume responsibility for the projects. There are problems too for thesites-and-services programme in Zimbabwe. The high standards of shelter andinfrastructural provision have already been modified to reduce costs, but unless thenumber of serviced plots is greatly enhanced and more consideration given toarrangements for letting, the programme is likely to remain inaccessible and beyondthe means of low-income groups. These criticisms of the Zimbabwean programmecorrelate strongly with general criticisms of the project approach to emerge from anassessment by UNCHS (Habitat) which concludes that projects:

invariably addressed only the needs of a proportion of overall demand, andoften a very modest proportion;

tended to focus on technical efficiency rather than a community-orientatedapproach;

were often beyond the affordability of the poor, or if not, created problemsbecause of a lack of availability; and

were generally not conceived in terms of the impact they might have onbroader urban development issues (UNCHS, 1991b).

Ironically, insofar as the EHP was something of a pilot programme in theRepublic of Korea, it seems that of the case studies, whilst it least adheres to theprinciples associated with the GSS, it may nonetheless prove to be the mostsustainable programme. There are nonetheless some important lessons to be learned

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from the EHP if it is to be more effectively targeted on the urban poor in the future.

A related issue to that of sustainability is the extent to which shelterprogrammes may be replicable and capable of scaling up to make a more effectivecontribution to overall housing needs. Whilst the São Paulo programme was acity-wide strategy, its output (albeit at the commencement of the programme),resulted in new and improved shelter conditions for approximately 100,000households and yet over a similar duration (19891992), the population increase inSão Paulo during these four years would have amounted to about 1.2 million peopleor almost a quarter of a million households. This not only demonstrates the scale ofthe shelter problem, it also underlines the urgency of the need to develop strategicapproaches which dramatically scale-up the level of provision.

Perhaps with the exception of the Republic of Korea there are major problemsin scaling-up current levels of provision in urban areas in India, Brazil andZimbabwe. One of the key problems is the scarcity of resources (and the relativeincapacity of state government resources in the Indian context is amplydemonstrated in the case study), but similar problems are apparent in Brazil andZimbabwe (and throughout much of the developing world). As a consequenceUNCHS (Habitat) argues that the most important elements in seeking to scale-upshelter programmes are, "popular participation (so that people 'own' the process andare committed to making it work themselves), financial self-sufficiency (through costrecovery, user-charges, and micro-economic development), and administrativecapacity (at all levels so that programmes and policies can be implemented efficientlyover time)" (UNCHS, 1991c). The latter is particularly important: "Unless the localauthorities are strong, well-resourced, efficient, flexible, and accountable, they will beunable to promote the right framework within which the household and privatesectors can play their roles" (UNCHS, 1991c).

Finally, in order to be fully aware of the progress being made both in generaland specific terms, the international agencies recommend a capacity for themonitoring and evaluation of shelter programmes. To an extent each of the casestudies has been the subject of research and evaluation exercises but the oneprogramme in which monitoring and evaluation processes have been used in anintegrated way to learn from experience and modify subsequent development hasbeen the SIP programme in India.

From this brief review of four case studies of low-income shelter programmesin Zimbabwe, Brazil, the Republic of Korea and India it may be concluded that theprogrammes in São Paulo and in India demonstrate the closest association with thekey principles recommended by the international agencies and the EHP programmein the Republic of Korea, the least. Each of the programmes, however, does exhibitsome characteristics of the new GSS agenda.

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Chapter VI. Reducing the human settlements problem of the urban poor

This chapter is concerned with a series of issues which are seen as critical toenabling strategies in attempting to reduce the human settlements problem of theworld's urban poor.

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Chapter VI. Reducing the human settlements problem of the urban poorA. The scope for public/private partnerships

The concept of 'partnership' is a pre-requisite for the implementation of theenabling strategy outlined in the GSS. In a study of public/private partnershipsUNCHS (Habitat) spells out the comparative advantages of the three sectors, public,private and the third sector comprising NGOs and CBOs (UNCHS, 1993b). Thecomparative advantages of the public sector may be summarized as:

ensuring an adequate land supply for low-income housing;

co-ordinating the provision of infrastructure and services;

establishing a sound financial environment to encourage private investment inshelter; and

liberalizing standards to permit a wider range of building materials.

Those of the 'commercial' private sector are as follows:

production and marketing of land and housing;

provision of infrastructure in middle and higher-income settlements on acommercial basis;

creation of a housing finance market;

production of building materials; and

development of a competitive construction industry.

The third sector — i.e. NGOs, CBOs and the urban poor themselves — havethe following comparative advantages:

producing shelter at the lowest possible cost;

developing some infrastructural facilities (sanitation and refuse disposal) on aself-help basis;

mobilizing local communities; and

mediating between the interests of financiers, the government andbeneficiaries.

It follows from such an analysis, as well as from practical experience, thatharnessing the efforts of two or more of these partners is likely to ensure greatersuccess or effectiveness in the implementation of projects, especially for the urbanpoor. There is a number of different types of partnerships. The five most prominent

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of these are summarized below.

The first type is partnerships over land supply. A number of successfulstrategies involving partnerships, such as land sharing, land readjustment, landbanking and so on, have been identified. Yet, the land supply achieved via suchmechanisms is very modest in comparison with needs. Thus "difficulties in ensuringaccess to land in sufficient quantities remains the most severe constraint onlow-income housing development in the Third World" (UNCHS, 1993b). A "stronggovernment intervention in the land market on a much greater scale" is thereforerequired. The ownership and control of land remains a very politically sensitiveissue, however. In many parts of the world such an approach is not only untenablebut impractical. Here, the opportunity for collaboration between the public andprivate sectors, with landowners in particular, over the issue of access and rights ofuse in respect of land would seem to be the most fruitful way forward.

The second type of partnerships are those over the provision of housingfinance. Not only are there fewer examples of partnerships to draw on in this area,there are very few that have actively benefitted the interests of the urban poor. Mostsuch partnerships have involved the support, consolidation or enhancement of theformal financial sector. It is only recently that efforts have been made to link the vastarray of informal financial arrangements with the formal sector, or to consider thepossibility of scaling-up these informal mechanisms. There is considerable scope forfurther dialogue over issues of housing finance for the urban poor, however, ideallybetween all three sectors in a mutually supportive relationship.

There are many examples of the third type of partnership arrangements, thosedesigned to assist in reducing the cost of building materials or in providing trainingfor construction. These kinds of partnerships may take the form of governmentassistance to small-scale suppliers, as in India or Colombia; or, at the local level,'materials banks' may be developed through bulk purchase arrangements. Examplesof such schemes exist in the Philippines and in Chile. Collective access to materialsthrough the development of cooperatives, as in Turkey and Uruguay, is a furtherform of partnership arrangement. The sharing of information and experience throughresearch and training is another way in which cheaper forms of materials andconstruction may be promoted. NGOs such as FEDEVIVIENDA in Colombia,CONAMUP in Mexico, and SPARC in India, have provided skills training forlow-income groups for many years.

There are also many examples of partnerships in construction and thedevelopment process. So many in fact that it is useful to subdivide the range into anumber of subsections: e.g. the role of cooperatives; partnerships in providing rentalaccommodation; or in inner-city renewal. Invariably, however, the involvement of theprivate commercial sector tends to result in products too expensive for the urbanpoor. The "key to partnership in the production of low-income housing remains,therefore, the development of an enabling environment by government which canliberate the third sector — people and their organizations — to do what they can do

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best, but to do it more effectively" (UNCHS, 1993b).

The fifth, and last, type of partnerships are those in the provision of basicurban services, such as sanitation and drainage, water supply, waste disposal andtransportation. It seems from experience that three conditions are necessary tobalance equity in provision and the cost recovery necessary to sustain services.These are, a strong link between cost and quality; a high level of participation byconsumers; and effective administration and supervision of the services. Thissuggests that partnership arrangements in the provision and extension of basic urbanservices and infrastructure to the urban poor are essential.

A number of factors contribute to the success (or failure) of public/privatepartnerships. In summary form these are (UNCHS, 1993b):

the requirement of strong government (at both national and local levels);

the involvement of NGOs and CBOs representing the views and interests ofthe urban poor as equal partners;

the need for greater coordination and the integration of functions within astrategic policy framework;

ensuring, as far as possible that benefits accrue to all the partners involved;

recognizing the importance of political, economic and cultural factors increating an environment in which partnerships are, at least, likely to succeed;

ensuring that the benefits of partnership programmes are both replicable andsustainable; and

recognizing that there are limits to the role of the commercial private sector inensuring the provision of shelter for the urban poor.

To summarize, "the key relationships in most of the partnerships affectinglow-income shelter are those which develop between people, third sectororganizations and the public sector" (UNCHS, 1993b).

In a number of these partnership arrangements it is also vitally important topromote income generation and employment opportunities for low-income groups.Whilst the United Nations has encouraged such approaches for some time, a recentjoint publication by UNCHS (Habitat) and ILO (UNCHS/ILO, 1995) sets out insome detail how the provision of shelter and other urban services may be seen tooffer enormous potential for employment opportunities for women and forlow-income groups, whilst at the same time improving efficiency and reducing costs.The main arguments in support of this approach and the opportunities it affords areset out in the following two sections.

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Chapter VI. Reducing the human settlements problem of the urban poorB. The potential for employment generation in human settlements development through

construction activity

The failure of public housing programmes to make a meaningful contribution inmeeting housing needs, especially for the poor, and the effects of global recessionon macro-economic policy-making, have meant that many governments indeveloping countries have reduced their investments in the housing sector. TheGovernment of India is a good example. Total public investment in the first FiveYear Plan (19501955) was very high, at about 8 per cent of planned public sectoroutlay. Since that time, however, it has fallen to about 2.5 per cent in the late 1960sand early 1970s and to its lowest level of 1.3 per cent during the Seventh Plan (19851990). It has been marginally increased in the latest Plan to 1.47 per cent. In terms ofcapital formation, public and private investment in housing has fallen from 34 percent in the First Plan to around 10 per cent in the Seventh Plan (UNCHS, 1993c).

Research over the last ten years or so, however, has challenged the assumptionthat investment in housing and associated development is unsound. Firstly, it hastended to emphasize the important economic role of the shelter sector. Tipple haspointed out, for example, that, "Housing represents more investment than any othersingle use in urban areas" (Tipple, 1994). Recent work by the World Bank andothers suggests that housing investment in developing countries ranges from 28 percent of GDP and from 1520 per cent of gross fixed capital formation (Buckley andMayo, 1989). Moreover, there is a close relationship between construction activityand economic growth such that when an economy begins to grow the constructionsector becomes an important element of that growth. At the same time, furtherresearch has demonstrated that the financial returns generated on a number of WorldBank schemes involving sites-and-services programmes and upgrading schemes hasbeen relatively favourable in comparison with other investments (Burns andFerguson, 1987). Much research has also been undertaken into the multiplier effectsof housing investment. Grimes has estimated that the multiplier effect of low-costhousing is about 2. In other words, for each unit of currency invested in housing afurther unit is generated by the economic 'spin-offs' of that activity (Grimes, 1976).Moreover, in terms of employment generation the benefits appear to be in inverseproportion to the costs of housing. Work undertaken by Ganesan in Sri Lanka, forexample, demonstrated that construction work on conventional low-cost housingand traditional dwellings generated about twice the labour inputs as luxury housing(Ganesan, 1975). Other studies in Africa and Latin America give similar results, (22)

that although informal sector housing consumes less labour, the lower unit costmeans more jobs per unit of expenditure, as well as many more dwelling units.

Hence the GSS not only acknowledges the need to encourage the provision oflow-cost housing through the informal sector. It also recognizes, and seeks todemonstrate, the potential economic opportunities that shelter provision and human

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settlements development afford for employment generation especially forlow-income groups and women. UNCHS/ILO (1995) makes a systematic appraisalof the potential for employment generation through housing production,infrastructural provision and the delivery of urban services, and the potentialafforded by backward and forward linkages to these programmes. In seeking togenerate employment from low-income housing programmes the study highlights anumber of advantages:

the nature of the activity, in calling for unskilled and semi-skilled labour, canhave an immediate impact in creating employment for the urban poor;

scaling-up low-cost shelter provision can generate more employmentopportunities for women, who are the sole bread winners in 25 per cent to 30per cent of all households in developing countries and whose numbers areincreasing (Urban Edge, 1988);

a shift in favour of labour-intensive construction methods and materials willassist the informal sector to ensure that a greater proportion of the investmenton shelter generates economic benefits for the urban poor; and

there also appear to be major advantages in substituting local, or indigenousmaterials, for high-cost imported products which require high levels offoreign exchange. Not only are local materials cheaper, but their intensifieduse will also create further local employment opportunities.

Efforts to scale-up low-cost housing programmes, especially in the light of tightmonetary environments and contracting public sector budgets, will not be easy.Governments will need to be convinced of the above advantages. The most efficientway would seem to be through the informal sector, by seeking to encourage greaterefficiency through training programmes, by facilitating finance, by a carefulreconsideration of regulatory frameworks so that whilst they are flexible enough todeal with diverse local conditions, they also provide the essential safeguards whichcontinue to be necessary. At the same time the range of low-cost housingprogrammes in the formal sector offer considerable potential for economicdevelopment and the generation of employment. Slum upgrading, urban renewal andresidential maintenance programmes involve incremental, small scale building workswhich are wholly suited to SSEs and to the creation of unskilled or semi-skilledemployment opportunities. Systematically pursued with training inputs, financialincentives and an employment-creation framework — such as exists in India —these programmes could generate considerable economic activity as well asundertake much needed renovation work to slum settlements and other parts of theurban housing stock in developing countries. As far as new construction throughsites-and-services, core housing programmes, etc., are concerned there is a need toeschew high-technology and capital-intensive approaches in favour oflabour-intensive building programmes using locally-based, low-technology materialsand to encourage the diversification of contractors, including SSEs.

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By adopting these kinds of approaches advocated by UNCHS/ILO (1995),Spence and others have calculated that, "where the urban population is growing at 6per cent per year ... the construction of residential accommodation of 6 m² for eachadditional person, using a technology for which the employment generation is of theorder of 0.05 to 0.1 job per m² ... would create employment for between 1.8 per centand 3.6 per cent of the total population. This will be in addition to whateveremployment is generated by the construction of roads and infrastructure" (Spenceand others, 1993).

Urban infrastructure provision is another area which UNCHS/ILO (1995) haveexamined in seeking to encourage opportunities for employment generation forlow-income groups. Infrastructural provision often involves major capital-intensiveprogrammes of work. The challenge involved is to see whether thosecapital-intensive programmes can be substituted, or even partially replaced, bylabour-intensive schemes which adhere to acceptable standards of efficiency andcost. The organization and management of such an approach is formidable, butexperience gained through the work of ILO in developing labour-intensive methodsin implementing infrastructural projects, including road building, provides importantlessons (ILO, 1993). The development of community contracts of employment isalso important and although these appear to have worked well in rural projects, thereis less experience of using this approach effectively in urban situations (UNCHS,1993a). Nonetheless there appear to be many opportunities for exploring thepotential of labour-intensive projects in relation to urban infrastructure provision."The provision and maintenance of infrastructure offers considerable potential forincreasing employment opportunities particularly for unskilled labour throughlabour-based and local resource-based approaches" (UNCHS/ILO, 1995).

The successful application of an employment-generating approach towardsshelter and human settlements development will also have important economicbenefits in 'backward linkages'. Backward linkages involve the effects on othersectors of the economy as a result of increases (or decreases) in the demand forgoods linked to construction. The most obvious impact is on the need for buildingmaterials. Woodfield (1989) has argued that if the shelter sector can be stimulatedduring a period of economic stagnation then the impact on economic multipliers maybe enhanced. This may be achieved, firstly, because an increased programme willgenerate additional demands for building materials; and secondly, because theemployment effects will encourage semiskilled and unskilled workers with a greaterpropensity to consume local products. The same principle also applies to the use ofmaterials; the multiplier effects on the local economy will obviously be greater if themajority of building materials are made locally using a local labour force, rather thanimported requiring the use of foreign exchange.

Developing countries should seek to use their indigenous resources betterthrough the development of their domestic building materials industry. In so doingthey will also be able to maximise the benefits of 'backward' linkages (UNCHS/ILO,1995).

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Whilst the difficulties confronting governments in seeking to ensure shifts inpolicy consistent with the above principles are not inconsiderable, there are a numberof international projects aimed at urban poverty reduction and maximizing localemployment generation currently taking place. Among these are the Urban PovertyPartnership Programme. This programme was launched in 1992/1993 and involvesfour United Nations agencies (UNCHS (Habitat), ILO, UNV and UNDP). Animportant future task is to identify good practice from this and similar programmes,to ensure the dissemination of results; and to establish appropriate trainingprogrammes throughout the developing world.

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Chapter VI. Reducing the human settlements problem of the urban poorC. The potential for employment generation from HBEs

Home-based employment activities are very common in developing countries,especially amongst poor communities. (23) Given their location in the home they areespecially important in respect of the role of women. Not only do they offeremployment opportunities for many women (Strassmann, 1986), but they are also anadded responsibility in running the home. For the poorest households, which areoften women-headed, "the act of living where they work or working where they liveseems more a necessity than a choice, as it is a matter of being the only spaceavailable where they can be or where they can feel relatively safe due to a network offriends or parents" (Blanc, 1994). At the same time, in poorer households, the wholefamily may be engaged in assisting in some way with the enterprise, including veryyoung children and the elderly. Several studies have identified a gender differentiationin intra-household activities which often consigns the most arduous tasks to femalemembers with the least reward in terms of space, food, personal time or money. (24)

Although HBEs are found mostly in low-income neighbourhoods, they are notexclusive to such communities (Strassmann, 1987), and the range of activitiesundertaken is enormous; "People bake, cook, sew, print, repair, photograph, giveinjections, cut hair, sell drink, rent lodgings, keep chickens, and sell other goods andservices in their homes" (UNCHS/ILO, 1995). Thus, although slum areas mayaccommodate mostly low-income groups, they may also be vibrant economiccommunities, but usually engaged in work of low productivity. The large slum ofDharavi in Bombay is an example; by reputation 'the largest slum in Asia,' Dharavi, isalso characterized by a huge variety of economic activities, the extent of which hasonly recently been revealed as a result of official proposals to redevelop the area.The different economic activities also have an intrinsic impact on the builtenvironment so that the area housing the pottery-makers, with its open air kilns androws of drying pots, is very different from the apparent chaos of the livelihoods ofthose involved in recycling activities, or the intense densities associated with thegarment-makers. Strassmann (1986), found similar geographical variations indifferent neighbourhoods in Lima. A further important factor to the survival of HBEsis access to markets. Often the informal products of HBEs are dependent on formalmarkets and margins are so fragile that geographical proximity is critical. It isprecisely these kinds of considerations, i.e. the organic nature of the built form andproximity to markets, which are so difficult to replicate in redevelopment andrelocation projects and which raise important doubts about the justification andviability of such approaches. Given that HBEs are common amongst poorercommunities already living in conditions of space constraints and accommodatingfamilies of perhaps five or six persons on average, the major function of HBEs is tosustain household incomes. Gilbert (1988), found that most HBEs were small andassisted only in marginally enhancing incomes, whilst Strassmann (1987), reported

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from Lima and Sri Lanka that the earnings of HBE workers were only about half ofwhat they would have earned had they been undertaking similar work elsewhere andon the same full-time basis. Despite these apparent low financial rewards, HBEs dohave a number of financial compensations. They are relatively easy to establish,since they require only a small capital input; overheads are very low; they obviate theproblems (often considerable), associated with journey to work and, at the sametime, save on transport costs; and their place in the informal sector also means theyare free of taxation (although perhaps not free of all costs in that some householdsmay have to make payments to continue their businesses). Thus, it seems that the'savings' render the meagre earnings to be worthwhile. One finding which confirmsthis conclusion is that Strassmann's work suggested that in poor neighbourhoodsespecially, dwellings with HBEs were of better quality than the others, having morefloor space and were more likely to be serviced with sewers. In poorneighbourhoods HBE households were the elite, whilst in more conventionalneighbourhoods they were struggling to keep up.

There are, however, also negative aspects to HBEs. They are often not subjectto official scrutiny which means that the workforce can be subjected to exploitation.This is perhaps less likely where the household has discretion over its activities. Inplaces where home-based working is organized on an 'outreach' basis with largenumbers of workers engaged for long hours on 'piecework' in very poor conditionsand for low pay (Schneider de Villegas, 1990), exploitative conditions do exist.These conditions invariably involve women, and in large numbers. Local attempts atorganization or unionization are often difficult and sometimes even dangerous forthose involved. A second disadvantage is the effect of HBEs on the environment.Unregulated HBEs often generate noise, dirt, fumes and waste that are a nuisance ora danger either to others or to the environment as a whole. These are 'negativeexternalities' which require state intervention in order to prevent or minimize theiradverse effects.

So far this discussion has centred around HBEs involving employment forhousehold members, however, the most frequent form of income generation throughthe use of the home is in sub-letting space or rooms in the form of rentedaccommodation. With the increasing cost of home ownership in many countriesidentified in chapter IV, it is apparent that many poorer households are only likely toacquire accommodation through renting rather than ownership, although the costs ofrenting may also be too high for some, leaving illegal squats the only alternative forthe poorest. Fuller consideration will be given to the opportunities afforded by arental strategy later (section J). For the moment it would appear that, in principle,similar safeguards need to be in place to deter and minimize the exploitation oftenants by landlords, to those needed to prevent the exploitation of home-basedworkers by unscrupulous employers or 'middlemen'. This suggests that theopportunities afforded by HBEs (including sub-letting), for generating employmentfor the urban poor need to be approached with some caution. The body of researchevidence suggests that the effects of SAPs, macro-economic stringency and policies

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oriented towards deregulation have not only increased the numbers in urban poverty,but have also increased the exploitation of vulnerable sections of the workforce andmost particularly female labour. In those countries where the tradition or capacity forenforcement was already weak, the active promotion of HBEs as part of a strategyto counter the effects of unemployment or underemployment carries greater risks ofthe increased exploitation of vulnerable groups.

This is a difficult and controversial area. "The challenge to policy-makers is toattempt to maximise both the employment creating potential of the informal sector, inthis case HBEs, and the degree of social protection and regulation extended to it" (UNCHS/ILO, 1995). Whilst the progressive legalization of the informal sector isessential, this is more likely to take place where obstacles to legal entry are reducedto a minimum, where costs are not prohibitive and where there are clear benefits inlegality. Hence, HBEs can be encouraged by reversing the trend towards smaller plotsizes in new housing development; revising regulations governing the use of plots,essentially to ensure health and safety standards; and creating a facility to encouragesmall loans to HBEs. At the same time, minimum standards need to be enforced inthree areas:

basic human rights such as freedom from forced labour and freedom ofassociation;

safeguards against exploitative types of employment relationships, e.g.hazardous employment or the employment of young children; and

the upholding of basic standards of occupational health and safety (UNCHS/ILO, 1995).

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Chapter VI. Reducing the human settlements problem of the urban poorD. Public participation and capacity-building

The rapid growth of the urban population has overwhelmed human settlementsprovision in many developing countries and has led to a widespread recognition thatit is the poor themselves who make the greatest contribution to shelter provision inthose countries. In recommending an enabling strategy for shelter provision, theGSS articulated the need to harness these efforts of the poor to house themselvesand envisaged a role for public bodies wherein the latter would support, and indeedencourage, these efforts as one of the basic principles of shelter strategy (UNCHS,1988). At the same time, most, if not all, the leading international agencies supportthe process of public participation in the formulation and implementation of nationalstrategies for human settlements development. The process is more difficult than therhetoric, however, because unlike the success of the 'green' or the 'white' revolutionsin the rural sector in India, for example, it is essentially a political rather than atechnical transformation which is required. Indeed, there may be a need fortransformation to take place at more than one level. The Community DevelopmentProgramme — funded by DANIDA and implemented by UNCHS (Habitat) —which has examined the scope for community participation in human settlementsdevelopment since 1984, has concluded that there is a need for "a new kind ofdevelopment politics" which involves "genuine devolution of power anddecentralization of activities" and it has to be recognized that this entails "somereduction of the power and decision-making authority now vested at the top" (UNCHS, 1991a). Clearly where such political support is forthcoming the scope foreffective action is much greater. There is no better illustration of this than in SriLanka during the Million Houses Programme (UNCHS, 1993a). An important recentdevelopment in this regard, however, is the passing of the 74th ConstitutionalAmendment by the Government of India in 1994, devolving some keyresponsibilities for human settlements development to local municipal corporations.Not only is there a need for a change of political will at national government level.There is also a need to mobilize communities themselves. If successful communityparticipation is to be elevated from the level of individual projects or neighbourhoodinitiatives, then it must be part of an inherently political strategy at the local levelwhich empowers local communities to take responsibility for their living conditionsand the environment and to take decisions which challenge the status quo. Anexample of a radical programme which sought to empower local communities wasthat of the São Paulo government mentioned above (chapter V.C).

In addition to the political obstacles to greater community participation inshelter strategies, other difficulties include the inflexibility of bureaucratic regulationsand procedures and the resistance of bureaucrats themselves; the lack of energy,time and personal resources of the poorest groups who may simply be unable torespond to participatory approaches; and a variety of other local factors such as the

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heterogeneity of the local population, or groups harbouring deep-seated religious orcultural differences.

Where such difficulties can be overcomed, however, the benefits of adopting aparticipatory approach appear to be gaining wider recognition. Some of the benefitsmay be summarized as follows:

from the community's viewpoint a participatory approach enables people todirect their efforts towards achieving improvements in their quality of life as awhole and not simply in their shelter conditions and physical environment;

the process of participation contributes towards engendering trust betweenlocal authorities, NGOs and CBOs which helps to build confidence, raise theself-esteem of poorer communities and enables them to participate withdignity more actively in the political, economic and social activities of theirtowns and cities;

from the viewpoint of governments (both central and local), communityparticipation offers one of the very few options for developing a strategywhich deploys resources commensurate with the need to provideimprovements for shelter and human settlement conditions; and

a community participation approach can increase the cost effectiveness of ashelter delivery programme, especially where the community contributesvoluntary labour inputs, and in this way it may supplement the scarce humanand financial resources available from NGOs and local bodies.

Whilst many governments have, in recent years, produced national shelterstrategies in line with GSS recommendations, only relatively few have given seriousconsideration to ways of addressing the shelter needs of the poorest groups.Encouraging community participation is at the heart of such an approach and it isimportant that governments do not abrogate their responsibility for providing moreeffective support to low-income groups. There is thus considerable scope forgovernments to adopt community-based, participative shelter programmes for theurban poor. It seems, too, that there is a major role for training and the disseminationof good practice in respect of such programmes. The UNCHS/DANIDACommunity Development Programme — concerned with examining the role ofcommunity participation in human settlements development in Bolivia, Sri Lanka andZambia — has taken a lead in this process both in exploring good practice in termsof methods and approaches to community participation, as well as in developingmanuals and guides for training programmes and dissemination to practitioners (UNCHS, 1991a; 1992c; 1993a). Some important findings of the programme forinstitutional development include:

local governments have a key role in developing such programmes inpartnership with NGOs and CBOs;

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preliminary research is essential to acquire information on the physical,economic, social and cultural situation of the target community;

carefully tailored strategies will be necessary with appropriate institutionalaccess of sufficient status to enable changes to be effected to governmentregulations and procedures; and

self-evaluation mechanisms and regular feedback are important.

Key findings on the training side include:

effective training is itself a participatory process combining classwork with'hands-on' training in the field;

there is a need to recognize the pre-eminent role of women and women'sorganizations in the community and to ensure that training programmes aregender sensitive and responsive to women's needs; and

that although there are 'core' issues which are common to different countries,training materials and approaches need to be adapted to different localcircumstances (UNCHS, 1991a).

The UNCHS (Habitat)/DANIDA programme has laid particular emphasis onunderstanding community participation and how it functions. It has created aresearch/action approach incorporating practical 'hands-on' training and thedissemination of key findings which may be replicated in other countries in order topromote good practice. At the same time such an approach may be consolidated byextending into related areas of activity, such as poverty reduction orincome-generating activities. It is vitally important that good practice in relation tocommunity participation as a means of assisting poor communities to improve theirliving conditions is disseminated as widely as possible.

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Chapter VI. Reducing the human settlements problem of the urban poorE. Increasing the access to residential land

Ensuring an adequate supply of residential land at affordable prices is anabsolute pre-requisite for the development of a shelter strategy for the urban poor.This is a universal problem (see chapter IV). The inability of urban authorities togenerate a reasonable supply of serviced land leads to an excess of demand oversupply and subsequently to increasing prices, the development of a 'black market',or as we have seen in some African countries, the use of land for political patronage.In those urban sub-markets accessible to the urban poor, low purchasing power iscompensated for by increased densities, often to intolerably high levels (up to 5,0006,000 persons per hectare in South Asia). In many instances the poor resort tosquatting illegally on any available site or, in circumstances of absolute desperation,to dwelling on pavements or in public places.

There are a variety of problems in ensuring a supply of residential land for theurban poor. First, the ownership and control of land is politically highly charged.Throughout the developing world governments have adopted a variety ofapproaches which vary from state control of all land through to an essentiallyprivatized market. It is apparent that none of these political strategiesper secarrieswith it an intrinsic solution to the problem of land supply for the urban poor.Second, there are shortcomings in policy and the institutions responsible for landregistration and supply. Many developing countries do not have a clearly developedurban land policy, an effective institutional structure, or a legal framework whichencourages the identification, proper legal registration and processing, and supply ofland for development. Third, even in countries where these structures are in place,the encouragement of a market oriented approach may act against the interests of theurban poor. In a highly competitive land market the poor are ill equipped to affordadequate access, and in circumstances of scarcity, speculation in land invariablyaccelerates prices.

In the face of these difficulties various approaches have been developed aimedat releasing land for the urban poor. These include:

Land sharing and readjustment initiatives. Perhaps the most widely knowninitiatives, these involve a form of barter. In principle, land sharing orreadjustment involves the surrender of a parcel of occupied land by a privateowner (usually) in exchange for the opportunity to realize some of thecommercial value of the site. The remainder of the site is then systematicallyplanned, allocated to the slum dwellers and services installed. With somevariation in the details of transactions, this form of land release has been usedwidely in the Republic of Korea, and in Colombia, India, Kenya andThailand. It has not always been used to benefit poor people, however. (25)

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Land banking. Another widely used approach, whereby governmentsexpropriate or purchase land and subsequently release the land at affordableprices specifically for poorer groups. Increasingly less used, as governmentresources are reduced and land prices rise.

The innovative use of land tenure. Several governments have soughtinnovative ways of using land tenure systems to facilitate access for the urbanpoor. Botswana, for example, has introduced an intermediary tenure formentitled the Certificate of Rights, a leasehold system, which has "enabled thegovernment to produce, fast and cheaply, many low-income plots" and has"played a leading role in containing the growth of illegal settlements in mosturban centres" (Kalabamu, 1994).

Joint ventures. Public/private partnerships in the form of joint ventures havebeen used in some countries to facilitate access to land for the urban poor.Such ventures were part of the strategy used by the São Paulo administration(see section V.C), but joint ventures have also been used effectively in thePhilippines and Turkey. (26)

The use of planning controls. Attempts have also been made throughplanning powers to ensure that land is set aside for low-cost housing, e.g.Malaysia, often as a condition of planning permission.

Other initiatives. Other initiatives have been developed which, whilst they havenot directly contributed to the supply of land for the urban poor, have beendesigned to facilitate the supply of residential land in general, or reduce theextent of speculation in the land market. Examples of such approachesinclude the establishment of the Urban Land Ceiling Act in India (see sectionIV.E); and the introduction of fiscal measures such as 'betterment' chargesaccruing from capital gains, or the introduction of hefty taxes on unused landto prevent hoarding, as in the Republic of Korea (see section IV.F).

This catalogue of initiatives is not intended to be exhaustive nor is there scopehere for a detailed appraisal. It serves to illustrate, however, that a range ofapproaches have been attempted by various countries throughout the developingworld. It is true to say, however, that such initiatives have, so far, met with limitedsuccess and, notwithstanding the UNCHS (Habitat)/World Bank/UNDP assistedUrban Management Programme, there is a tangible need for a sustained internationaleffort to improve professional competency and service delivery in urban land-useplanning and management. As Musandu-Mayamayaro (1994) observes, however,"accounts offering critical reviews of municipal land delivery systems and processes... are, unfortunately, not matched by those that offer concrete solutions." Neithercan the current policy environment be considered very supportive. With theinternational agencies advocating a market-led approach, and SAPs resulting inreductions in public sector spending, many municipal authorities have a diminishedcapacity and reduced resources to embark on policy initiatives designed to improveefficiency and enhance output (DAG, 1994). Nonetheless reforms are needed and at

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both central and local government levels. They begin with a recognition by centralgovernment of the requirement for a clear strategic framework for urban land policyand management. The Government of Bangladesh has recently reviewed its policiesfor urban land management in an important national seminar and has concluded witha number of recommendations which have relevance for many other countries (Islamand Chowdhury, 1992). Amongst the recommendations at strategic level relatingspecifically to urban land management were:

the need to strengthen urban land management within the context of a nationalhuman settlements policy for the country as a whole;

the need to update the legislative framework by enacting an Urban andRegional Planning Act and by revising zoning regulations and building codes;

the strengthening and modernization of institutions responsible for themaintenance of land records, mapping and surveys;

enhancing the scope for professional training;

establishing a National Commission on Urbanization to formulate appropriateurban policies; and

a research and monitoring capacity.

At the local or operational level the review identified a need to:

strengthen the capacities of municipalities in planning and urban management;

operationalize and develop techniques such as land sharing and adjustment tomaximize land resources;

designate land for the urban poor and make available financial resources forthe purchase of this land and for shelter construction for the urban poor;

upgrade the operational responsibilities for field staff and enhance capacitythrough training; and

upgrade technical capacity through computer use and introduce localresearch and monitoring capacity.

In the case of Bangladesh, major reforms were evidently considered necessary.In those countries with a well developed and strong municipal tradition, however,there may be a case for a streamlining of existing administrative procedures toreduce bureaucratic delays and speed decision-making. Given the difficult currentfinancial environment for municipal bodies, however, it is likely that such reformswill remain as good intentions unless the revenue generating possibilities are alsooperationalized. This will mean exploring the fiscal opportunities afforded by landmarket transactions, such as betterment charges on land development. The negativeaspect of such charges is that they will invariably increase the price of land.

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Chapter VI. Reducing the human settlements problem of the urban poorF. Improving access to housing finance

Whilst informal mechanisms for housing finance, such as rotatory creditassociations, are widespread in countries throughout the developing world (Osonduand Middleton, 1994), the absence of formal financial arrangements is acknowledgedto be a major constraint to the development of efficient housing markets (WorldBank, 1993b). Even where formal housing finance institutions do exist, they are oflittle direct benefit to the urban poor: "the fact of the matter is that formal sectorhousing finance institutions fail to reach the low-income households either asborrowers or savers" (Kim, K-H, 1993).

There are several reasons for this; first, as Munjee (1993) points out, "The heartof any efficient housing finance system, whatever manner it may be structured, is anoperational land market (even though it is not entirely efficient), with fairlyunambiguous titling arrangements". As we saw in the previous section, fewdeveloping countries can claim to have effective land markets which are efficientlyserviced in respect of property rights and titling arrangements, and even where theywere this would only serve to highlight the lack of access for the urban poor.Secondly, the poor are perceived by the financial institutions, for a variety ofreasons, as being a 'high risk' group and perhaps the first law of banking is "tominimize risk". Where the institutions may be persuaded to lend, however, they willcounter the effects of increased risk by higher charges, thereby rendering theprocess once again beyond the means of the poor. Thirdly, transactions with thepoor are administratively costly compared to higher-income savers and borrowers,because although the administrative costs of accepting savings or servicing a loanmay be no different from other clients, the sums saved or borrowed are likely to besmaller. These relatively high administrative costs tend towards a reluctance byformal financial institutions to encourage the involvement of poor groups in anysubstantial way (Patel and Burra, 1994). So, there remains a policy dilemma as tohow to extend the facility of formal housing finance to the urban poor.

In many parts of the developing world and particularly Africa and LatinAmerica, where formal housing finance institutions are experiencing a very difficultfinancial environment, the proposition of extending their lending to the urban poorappears currently ambitious and is not a priority. It is in the countries of South andSouth-East Asia (and in China) — perhaps where the economies are more robust, orwhere the impact of SAPs has not been so adverse — that innovatory developmentsin housing finance are rapidly taking place:"Countries in the region which did not have conventional mortgage lendinginstitutions are now striving to establish them mainly in the private sector (India,Nepal, Vietnam). Those that have state owned housing banks are firstlyattempting to create a more diversified market with private sector participants(Bangladesh, Pakistan, Sri Lanka and Indonesia) and secondly to transform their

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existing institutions into more market oriented institutions, if not privatizing themfully. Finally, those that have developed a fairly extensive housing finance systemfor middle-income borrowers, are seeking methods to extend the system to assistlower-income households (Malaysia, Thailand, Korea and Philippines)" (Munjee,1993).

This assistance to low-income groups by the formal financial institutions in anattempt to link the formal and informal sectors, is being matched by nascent attemptsby community-based savings organizations to scale-up their activities to becomepeoples housing banks.

Much of the former activity by the housing financial institutions in South andSouth-East Asia is taking place under the auspices of the Asian Housing FinanceCoalition, which consists of housing finance institutions from India, Thailand and thePhilippines, and the KRIHS of the Republic of Korea. Through its members thecoalition is experimenting with at least two initiatives designed to extend housingfinance to the urban poor. The first is the Community Mortgage Programme whichhas been developed by the Home Development Mutual Fund, a shelter financeagency established by the Government of the Philippines, "to enable squatters orslum dwellers to acquire tenure to the land they have been illegally occupying or toanother site where they are relocated" (Alonzo, 1994). Finance under this programmeis arranged in three portions. First, for the acquisition of the land at a price agreed innegotiation between the landowner and the community association or cooperative;second, for infrastructural provision; and thirdly, for home improvement orreconstruction. Substantial inputs to infrastructural works and housing are made on aself-help basis, but under professional supervision. The Fund currently has 66community associations registered as members involving over 8,500 families and anestimated requirement for finance for land acquisition of $3 million (Alonzo, 1994).

The second initiative involves action research projects in each of the countriesin which the Coalition has a presence in order to extend savings and borrowingfacilities to low-income groups by using NGOs as intermediaries. The basic principleunderlying this activity is the establishment of partnerships between formal financialinstitutions, NGOs and CBOs with a view to influencing savings and lendingprogrammes in order to make them more sensitive to the needs of poorer groups.

Other NGOs in the region are critical of this approach, arguing that it is both"dangerous and dysfunctional" (Patel and Burra, 1994). Their concern is that NGOswill become "a conduit for loans" which will overwhelm all their other activities andturn "what should have been a joint venture between communities, NGOs andhousing finance institutions" into "a moral and organizational liability of the NGO".Instead a number of NGOs in India, primarily spearheaded by women'sorganizations (e.g. SPARC, Mahila Milan and the Self-Employed Women'sAssociation (SEWA)), are taking their inspiration from the principles of the GrameenBank in Bangladesh and are seeking to scale-up relatively modest savings and creditschemes for housing and other purposes, into financial institutions, directlyaccountable to, and specifically for, the urban poor. Hence, JANASAMPATTI

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('People's Wealth') is aiming to build upon the success of existing savings schemesfor slum dwellers in Bombay and other Indian cities (initiated by SPARC andadministered by the women's pavement dwellers' association, Mahila Milan), and toconsolidate these savings into a central fund which is both large enough to attracthigh rates of interest in the formal financial sector, whilst at the same time, beingused as collateral against which to raise loans from a variety of other sources. Bymixing together these funds from other sources, it is hoped that different financialpackages may be devised which will be much more suited to the needs of the poorthan conventional institutional lending (Patel and Burra, 1994). Whilst the assessmentof individual projects would be made by a core team of professional staff, the policyframework would be decided by representatives of CBOs and democratic controlensured by the appointment of Board members (Patel and Burra, 1994).

The innovatory thinking of these NGOs has also influenced governmentpolicies, in that the Housing and Urban Development Corporation — the mainsource of housing funds for state governments — has recently formulated a loanarrangement for the urban poor. Under this new arrangement it is prepared todisburse loans through NGOs and CBOs with a track record of local savings andcredit schemes, in return for a deposit of 1025 per cent of the loan. This depositserves as collateral for the loan, rather than requiring the parties to enter intomortgage arrangements.

This brief résumé of initiatives in respect of housing for the urban poor hasconcentrated on innovations in South and South-East Asia. Whilst the financialenvironment in many parts of the world remains relatively bleak, these initiativessuggest that there is, nonetheless, substantial scope for the development of theseideas and for their wider application in many other developing countries.

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Chapter VI. Reducing the human settlements problem of the urban poorG. Improving access to appropriate building materials

There has been increasing concern over recent years with problems over thesupply of building materials for traditional house construction in developingcountries. The problems were highlighted in a report to the fourteenth session of theUnited Nations Commission on Human Settlements (UNCHS, 1992a). It identified "amounting crisis" in materials supplies which can be characterized as follows:

Although building materials production and consumption in developingcountries increased during the 1980s, it was uneven in output. An overalldecline was registered in Africa and a decline in some key materialsproduction in Latin America.

There is an increasing tendency for developing countries to resort toimported materials in order to bridge the gap between supply and demand.Between 1975 and 1985, for example, developing countries increased theirimports of building materials in real terms by 85 per cent.

Partly as a result of imported products, the price of building materials hasrisen very rapidly in many developing countries. In the United Republic ofTanzania, the price of sand, cement and steel increased more than fivefoldbetween 1982 and 1989. A similar picture of rapidly increasing prices isapparent in Latin America and Asia. The obvious effect of such priceincreases is to raise the costs of housebuilding. The prospect of homeownership is thus placed even further beyond the reach of the urban poor.

These price increases may be attributed to seven particular causes (UNCHS,1992a):

The rapidly depleting supply of raw materials on which building materialsproduction depends. Each of the main types of building materials, wood,bamboo, grass, earth, building stone and limestone, is experiencingdifficulties of supply at current levels of demand.

The steeply rising costs of energy. Cement, steel, bricks and lime are allenergy-intensive materials and many developing countries' energy costs haverisen by more than 25 per cent over the decade.

The use of inappropriate technology. Ironically many governments indeveloping countries established large factories for the production of localbuilding materials as part of their import substitution policies during the1950s, 1960s and 1970s. Unfortunately these plants have depended heavilyon imported spare parts and machinery, which has resulted in low capacityutilization.

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A lack of improvement in productivity owing to the fragmented nature of theindustry.

Local materials lacks status among end users or statutory authorities. Theresult is that well established technologies remain hardly used.

Distribution and marketing problems often significantly affect the retail priceof building materials.

There is often little recognition amongst policy-makers of the significance ofthe building materials sector and, hence, a lack of official recognition andsupport for its needs.

There is thus a need for governments to develop a strategic approach for thedevelopment of the building materials sector. There is a wide range of opportunitiesavailable for governments wishing to address these problems seriously, such as, theapplication of new materials and technologies, the need to ensure improvements inenergy efficiency, and the adoption of appropriate levels of technology in localmaterials production. All of these factors are designed to improve the efficiency andeffectiveness of the supply of indigenous building materials. By increasing supplieswhilst at the same time reducing costs, they would ultimately (hopefully) be ofbenefit to the urban poor. UNCHS (1992a) also make a number of recommendationswhich would be of more direct benefit to the urban poor. These include, firstly, theneed to diversify the production of indigenous materials to include small-scaleproducers and those in the informal sector. As indicated earlier, small-scaleproducers tend to be less capital-intensive and to employ more local labour. Theyalso have the advantage of reducing the transportation costs of materials, and arelikely to be more responsive to the needs of local builders whether these are SSEs orthose engaged in self building or renovation. It is also important that support isavailable to encourage entrepreneurship through training, and/or advice and guidanceso that credit for such enterprises is available. The aim should be to upgrade theactivity of small and informal sector enterprises to improve their productivity andfinancial viability, whilst at the same time minimizing the detrimental environmentalimpact of their operations.

Secondly, positive attempts should be made to encourage the involvement oflocal communities in both off-site and on-site production activities. Successfulexamples of aided self-help and partnership arrangements involving localcommunities in residential construction activities have been undertaken in a numberof countries, but there is also the opportunity of employing local labour in theproduction of building materials on a greatly enhanced scale. This prospect offersthe added advantage of offering employment opportunities for women. Experiencehas shown, however, that women tend to be marginalized when it comes to formalemployment opportunities in construction and related work (UNCHS, 1990b).Although there may be other difficulties, such as cultural norms prohibiting women'sinvolvement, the main obstacle to enhanced female employment in this sector isaccess to training, which may in turn require financial support to enable their

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participation. Critically, however, "the essential principle ... facilitating women's entryinto non-traditional occupations is a detailed and in-depth understanding andknowledge of the dynamics and requirements of the existing and potential markets inwhich skills ... will be sold" (UNCHS, 1990b). This suggests a rigorous marketappraisal as a prelude to a carefully tailored programme of training opportunitieswhich is also sensitive to gender issues if this opportunity for enhancing jobopportunities for women is to be genuinely seized.

Thirdly, activities should be targeted towards the poor, as they are the mostvulnerable. Examples of good practice might include partnership arrangements withNGOs to secure economies of scale through bulk purchasing arrangements.Examples of this occur in Thailand (Boonyabancha, 1990) and in Chile (UNCHS,1993b). Alternatively, and with the assistance of NGOs, 'building materials banks'may ensure priority access for low income communities, as in Chile, Colombia andthe Philippines (UNCHS, 1993b). Low-income communities (and particularlywomen) may also benefit from targeted programmes of learning in construction skillsand from technical advice and guidance over the use of materials, as undertaken forsome time by NGOs like FEDEVIVIENDA in Colombia and CONAMUP in Mexico(UNCHS, 1993b), or through the Building Centres in India (UNCHS, 1992a).

UNCHS (1992a) recommends the exploration of new materials and techniquesin the continuing search to reduce costs and whilst it is assumed that much of thiswork will involve technical expertise of one sort or another, there is one area whichcould offer further employment opportunities for some of the poorest groups. Thisis in the recycling of waste materials, such as scrap metal, or the re-use ofnon-hazardous industrial waste materials. Since the recycling of waste materials isvery much the responsibility of some of the poorest groups in developing countries,the systematic use of such materials for use in construction could well increase theemployment opportunities for the very poor.

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Chapter VI. Reducing the human settlements problem of the urban poorH. Improving infrastructure and sanitation

The review of housing conditions for the urban poor in chapter IV illustratesthat, the absence or poor quality of infrastructural facilities for the urban poor is apervasive problem in many cities in developing countries. The statistics availablevary from city to city and from country to country and are often official estimates(which tend to be cautious), or aggregate figures for cities, or even countries as awhole, which conceal the true extent of deprivation. The picture which emerges,however, is one in which the urban poor constitute a significant proportion (rarelyless than one-third of the urban population and sometimes twice that proportion),and they suffer disproportionately in terms of the lack of a wholesome water supply,from proper sanitation, and from the absence of an effective refuse disposal system.These findings are consistent with other global estimates. Hardoy and others (1990),quoting estimates by the WHO in 1985, state that "a quarter of the Third Worldsurban population had no access to adequate, safe water supplies and half had noadequate sanitation system." Figures by UNDP (1995), however, indicate that 12 percent of the urban population in developing countries lack access to safe watersupplies, while 31 per cent lack access to sanitation facilities (see table 10 ). Thus,the figures for the urban poor themselves will be much higher, as the detailed workof Kundu (1993) in India testifies.

Comparative information about the standards of infrastructure provision overtime is even more elusive. There is, however, some evidence to suggest that despitethe infrastructural investment made during the 1980s, the problems of lack ofprovision may be increasing, at least in some parts of the developing world. Themain reason for this deterioration is the rapid growth of urban areas and theincreasing incidence of urban poverty. The consequences for the health and safetyof those in slum and squatter settlements, and for the public health of millions ofother urban dwellers, are alarming:"a lack of readily available drinking water, of sewerage connections (or othersystems to dispose of human wastes), of garbage collection and basic measures toprevent disease and provide health care ensure that many diseases are endemic;diarrhoea, dysenteries, typhoid, intestinal parasites and food poisoning amongthem. These combined with malnutrition so weaken the body's defences thatmeasles, pneumonia and other common childhood diseases become major killers"(Hardoy and others, 1990).

When one takes into account the fact that health spending per person actuallydeclined in many developing countries over the 1980s (UNICEF, 1990), the case fordecisive action over infrastructural provision becomes even more pressing.Following the need to enhance the release of larger supplies of urban land, theprovision and upgrading of infrastructural facilities in slum and squatter settlementsshould become a second priority of national shelter strategies for urban areas.

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Local government has traditionally been responsible for the planning,implementation and maintenance of infrastructural provision and it is invariably a lackof funds and technical competence which lies behind its inability to extend servicescommensurate with the needs of rapidly growing urban communities. If authoritieshave been unable to cope in the past it is simply unrealistic to assume thatcircumstances will change greatly in the future. The first task confronting localauthorities seeking to extend their infrastructural provision, therefore, is to generatethe resources required. In the past central government has been the major source offinance for infrastructural works either from funds generated externally throughinternational agencies, or internally through tax revenues. In the current economicclimate, however, government expenditure is likely to be severely constrained owingto SAPs and the tight fiscal environment. In fact, spending on infrastructure has beenmost adversely affected by expenditure cuts. It is thus "imprudent to look to centralgovernment to finance infrastructure investment growth on the scale that will beneeded to meet the goals of the [GSS]" (UNCHS, 1990a). The implication is that,henceforth, such funding is likely to have to be generated locally with a greateremphasis on user charges and other sources of local finance. The danger is that thiswill impose a greater burden on the poor, and, indeed, in many cases has alreadydone so (Moser and others, 1993), or that it will influence local authorities choice ofmajor works in favour of those which are more amenable to cost recovery.

Under such circumstances local authorities face an uncomfortable dilemma.One can only argue, however, that in determining their priority for infrastructureexpenditure which is targeted towards poorer communities in preference to otherpressing claims for finance, they should give cognisance to two issues; firstly, theeconomic arguments outlined earlier in this chapter in respect of the multiplier effectson the local economy of investment in construction activity (see section B, above).Secondly, local authorities also need to consider the impact of such investment inraising the quality of life of relatively large numbers of the urban poor and thesubsequent improvements on the health and welfare of those communities.

In moving forward from the mobilization of resources to modes ofimplementation, the decision to invest in the upgrading of the infrastructuralenvironment of slum and squatter settlements will have a much greater beneficialimpact on the urban poor if the local authority seeks to adopt a communityparticipation approach and involve those local communities actively in the upgradingprocess as recommended by UNCHS/ILO (1995). Indeed, as "government projectsbased on direct labour or large contractors rarely fulfill expectations or needs, thecommunity-based approach may be the only realistic alternative for neighbourhoodlevel public works". Furthermore, works of this kind, like the self-help housingsector, provide "an ideal entry point into learning skills and gaining experience in thelogistics of development" (UNCHS/ILO, 1995). Adopting an approach of this kindwill involve at least three elements:

consultation with those local communities over their priorities for localinfrastructural investment;

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adoption of labour-intensive approaches to implementation where it ispossible to do so; and

a programme of local recruitment and training to carry out the works andensure the facility for continuing maintenance.

If these approaches are adopted, and emphasis is also given to the training andrecruitment of female labour as mentioned above (see section G above), localauthorities can maximize the beneficial impact of their major capital worksprogrammes on poor communities.

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Chapter VI. Reducing the human settlements problem of the urban poorI. The effect of building and planning codes and regulations on the human settlements

conditions of the urban poor

Housing provision in urban areas is invariably governed by a number of codesand standards regulating densities, plot sizes, the use of building materials, and soon. Unfortunately in many developing countries such codes and standards are ahindrance rather than a help in trying to secure an improvement in housing standardsfor the urban poor. Schilderman outlines ten reasons as to why standards indeveloping countries may be inappropriate:

"Housing standards are often imposed or imported and therefore not in linewith local conditions, culture or building conditions.

Such standards fail to recognise that housing in the Third World is moreoften an incremental process, than a one-off exercise of building completehouses.

These standards are not based on consensus, but set by middle orhigher-income policy makers, and fail to take account of the masses.

Most standards are therefore socially divisive: they only recognise the 'well todo', and categorise the less affluent as substandard or illegal.

Current standards are not affordable, both at the level of the masses and ofcountries as a whole: the resources simply do not exist to house entirepopulations according to the level set by them.

Housing standards do not necessarily reflect people's priorities: for examplethey might favour the quality of construction above quantity of space,whereas space is what most people want in the first place.

Imported standards require the use of scarce and often imported buildingmaterials and skills, and thereby retard the development and dissemination oflocal technologies; this is economically unsound.

Constructing houses according to the regulations means going through amaze of bureaucracy; even if householders understand this process, it stillmakes access to standard housing lengthy and costly; it also encouragescorruption.

Imposing high standards by force, including the destruction of substandardhousing, has an adverse effect on people's willingness to carry out homeimprovements, and destroys much of housing resources. It also goes againstthe traditional processes of incremental housing.

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Finally, imposing high standards will increase rental housing, and result inovercrowding and an overuse of infrastructure installed in standard housingareas. That, in turn, may make these areas substandard, and defeat thepurpose of the standards" (Schilderman, 1994).

These criticisms imply that a new and different approach to the question ofstandards is required in many developing countries. Standards need to bereformulated in a way which recognizes the need for safeguards in terms of thesafety, security and health of households and local communities, but also in a waywhich supports rather then penalizes the efforts of the community. Above all, thereformulation of codes and regulations needs to be realistic in terms of achievementand sensible in terms of affordability. At the same time, local housing conditionsvary and the formulation of attainable and affordable standards is best done withlocal knowledge and experience rather than in a centralized and detached manner. Ifan enabling approach is to be adopted, therefore, there needs to be flexibility interms of the standards required.

A number of other principles should also be considered by governmentsseeking to reformulate housing, planning and building regulations. Firstly, muchconstruction activity in the informal sector takes place over time and on anincremental basis, as and when households secure the resources to undertakeimprovements. The reformulating of building codes and standards needs toacknowledge this by defining minimal standards and by giving guidance overprogressive developments over time. Several governments have adopted such anapproach to their sites-and-services programmes; the government of Malawi, forexample, has developed Minimum Building Standards which allow for the use ofmodest construction techniques in the expectation that standards will improve overtime. Such an approach might also be developed for settlement upgradingprogrammes.

Secondly, the reformulation of standards also needs to take account ofquestions of technology. Municipal authorities have the opportunity not only toencourage, but actively to promote the enhanced use of indigenous building materialsand low-cost products rather than the use of expensive and imported substitutes,through the application of their building codes. If this is to be achieved, however, thereformulation of building codes and standards and the strategy for the developmentof the building materials sector (see section G above), need to be mutuallyreinforcing in order to achieve the greatest impact.

A third consideration in the reformulation of standards is the substitution for(sometimes) highly prescriptive specifications of materials by measures ofperformance to be achieved. Schilderman (1994) describes changes to the buildingby-laws achieved through a Ministerial Task Force in Kenya; "The 1968 version ofby-law No. 219 requires facilities for washing clothes; these should be of a minimumsize of 90x60 cm for a slab and 90x90 cm for a splash area; the slab should be madeout of 7.5 cm concrete on a suitable foundation, and provided with a 0.5 inch

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standpipe and tap, connected to the mains". The 1992 version merely states that "alldwellings shall be provided with facilities for washing clothes and utensils; thisallows for any size and type of floor, e.g. thin concrete or clay tiles". This is not onlya simplified system, which is easier to understand, it also allows for greater flexibilityin terms of implementation.

The adoption of a more flexible building code is an important reform, but itmay not be seen in isolation from the way in which the code is interpreted bymunicipal officers. Ideally government officials would be engaged in a pro-activerole working with the community, and possibly with NGOs, in a politicalenvironment where they were expected to, and were capable of, exercising theirprofessional judgement within the context of a flexible policy framework.Unfortunately, many municipal authorities in developing countries have neither thequalified staff nor the organizational capacity to operate in this way. Despite thecapacity-building associated with the Urban Management Programme and thecommitment of other international agencies to the strengthening of municipal finance,it is difficult to envisage any rapid improvements in the effectiveness of municipaladministration in developing countries, especially under current political andeconomic priorities. A much greater emphasis on improved training and managementcapability in local authorities is essential.

Nonetheless, UNCHS (Habitat) has been working for some time in seeking topromote the adoption of more appropriate building codes and standards fordeveloping countries. An international information exchange has been established bya number of international organizations working in this field and professional adviceand guidance is available to governments wishing to enhance their capabilities inrespect of the reformulation of building by-laws and standards.

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Chapter VI. Reducing the human settlements problem of the urban poorJ. Renting as opposed to ownership: Options for the urban poor

Commentators are highly cautious over making estimates of the numbers ofhouseholds living as tenants in developing countries. What is known, however, isthat the numbers are substantial and that they vary markedly from one country toanother. Whilst ownership remains exceptional in Chinese cities (despite the currentinitiatives towards privatization), in other countries, such as Venezuela andColombia, the majority are owners. Gilbert summarizes the situation as follows,"most people in West African, Chinese, Indian and Korean cities rentaccommodation; a majority in the cities of the larger Latin American and MiddleEastern cities tend to be owner occupiers" (Gilbert, 1990).

The nature of renting also varies between one country and the next. The mostobvious distinction is between renting in the public or private sectors. On gainingindependence many African, South Asian and South-East Asian countries emulatedthe experience of the developed countries and embarked upon state fundedprogrammes for rent, usually to targeted population groups, such as civil servants orspecialist workers. Not only have these programmes been comparatively modest, butthey have also invariably experienced difficulties of administration which has, sooneror later, resulted in their conversion to programmes for sale. Wadhva (1994) chartsthe experience of such schemes in India. Apart from problems in securing rentrecovery, she identified three reasons for the failure of these early programmes;firstly, the high cost of operation and low revenues rendered the schemesnon-financially viable; secondly, the procedures specified by central government tomake subsidy available were very cumbersome; and finally there were seriousproblems in administering the accommodation (Wadhva, 1994). Very similarproblems over administration and management, and rental recoupment have beenexperienced in other African and Asian countries. As a consequence, and with thepossible exception of China, few developing countries have significant amounts ofpublicly rented accommodation.

In strong contrast, the private rented sector often plays a highly significant rolein the housing market of developing countries. It too, varies significantly betweencountries in many ways e.g. in the type of landlords; the relationship betweenlandlord and tenants; the impact of legislation; the nature of tenancies, and the formsof accommodation. Thus, the formalized nature of private tenancy arrangements inthe Republic of Korea, where there are three forms of tenancy, (27) is in markedcontrast to the informal tenancy arrangements, or the availability of freeaccommodation in some West African cities (UNCHS, 1993f); or the enormouscomplexity surrounding tenancy arrangements in thebusteesof Calcutta.

The variation in size in the privately rented sector in various countries hasstimulated much discussion over which factors influence and determine the growth

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or contraction of the sector. Edwards (1990), distinguishes between housing builtspecifically for letting and other housing which may, at some stage, be madeavailable to let. In the case of the former, whilst it is comparatively rare to findhousing constructed for letting in the informal sector, it is relatively frequent in theformal sector. Such housing may be historic in that in the older, core areas of citiesthere are often tenemental structures specifically built to house workers (as in manySouth Asian cities), or former colonial areas now subdivided to provide rentedaccommodation. It may also be contemporaneous, providing housing for rent,remains widespread in many African countries, for example. The main factorsaffecting the supply of such accommodation are summarized by Edwards (1990):"The most important factor ... is the rate of return on investment. Although rentsare usually low in this sector, the multi-occupancy character of tenements and thefact that little or nothing is re-invested by the landlord in maintenance can makethem an attractive proposition. Also significant are legal control (on rent levels orthe subdivision of dwellings), the historic pattern of urban development ... thelocation of employment opportunities which require a proximate supply of cheaplabour, and the availability of capital .... Finally, commercial redevelopment ofthe inner city ... inevitably reduces the stock of cheap rental housing in the samearea".

The bulk of rental housing in developing countries, however, is provided bylow-income home owners in both legal and illegal settlements. Edwards (1990),argues that there are two critical sets of factors determining the supply of suchproperty, first, the ease with which the poor gain access to home ownership, andsecond, the propensity for low-income owners to let their property. The maindeterminants of the first are well known, the price of marketable land and ofmaterials, the accessibility of that land to the urban poor, and the relative incomelevels of the low-income groups. As far as the propensity for homeowners to let isconcerned much less is known, but Edwards suggests the key factor again is theprofitability of letting; other factors also include, the influence of governmentpolicies, such as rent control or slum clearance programmes; income levels, the sizeand design of dwellings; lifecycle changes affecting the household (and influencingthe availability of space available for letting in the dwelling); and cultural factors,such as obligations to kin, or the need for separate space for female members.

Work by Kumar in Madras (1994), has tried to shed light on the motivation oflandlords to let their properties. He argues that low-income landlordism may bedivided into three; these are, first, "subsistence landlords" who generate rentalincome in order to meet "essential consumption expenditure"; second are the"consolidator landlords" where rents are used "to improve the material base of thehousehold and the dwelling"; and third, "petty-capitalist landlords" where rentscontribute to "the expanded reproduction of capital in the form of landed property"(Kumar, 1994).

The shifts in policy focus advocated by the GSS have led to a growingrecognition in recent years of the part played by private renting in providing shelter

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for the urban poor. At present, however, policies to encourage the privately rentedsector are tentative and guidelines are broad-based; they are handicapped as Gilbert(1990) acknowledges by a lack of information about the sector and an absence ofpolicy initiatives which might act as examples of good practice. The World Bank hassought to encourage sub-letting in sites-and-services programmes; the Governmentof the Republic of Korea has provided subsidies to encourage companies toconstruct employees housing (see above, section V.D); and the KampungImprovement Programme in Indonesia has encouraged the provision ofaccommodation to rent. Yet, such initiatives remain rare and do not constitute astrategy.

Clearly much work remains to be done to encourage a healthy privately rentedsector. In stressing the critical link between the growth of low-incomehomeownership and the availability of accommodation for rent, Edwards makes animportant contribution to policy. He confirms that a strategy aimed at encouraginglow-income home-ownership may result in an additional dividend for the urban poorthrough opportunities for renting. Kumar's work is important too in that it highlightsdistinctions in the financial motivation of landlords. He suggests that a strategy forencouraging landlordism needs to understand better the financial factors likely toencourage home-owners to become landlords and to devise appropriate fiscal andfinancial incentives, rather than relying on a general exhortation, "to review rentcontrol legislation". Much may also be done to modify building and planningstandards to create a more positive environment to encourage expansion, whereappropriate, rather than inhibit it.

The development of appropriate rental strategies is essential as the urbanexpansion in the coming decades will mean that rental housing must assume anincreasing share of housing supply and will need to become "a vital part of agovernment's arsenal of enabling policies" (UNCHS/ILO, 1995). A number ofrecommendations should thus be adopted to encourage opportunities for renting:

progressive withdrawal of rent controls;

tax benefits on rental income where this is appropriate and practical;

encouragement of house extensions in well-built and well-located housing inorder to increase accommodation for rent.

At the same time any strategy for encouraging the expansion of the privatelyrented sector needs to introduce safeguards for tenants and for the poorest. AsSundaram (1990b) points out, the security of tenants in unauthorized settlements israrely a matter of legal argument, but more "a function of community pressure,perception ofde factolegality of the settlements, and the clout of the landlord". Insuch circumstances there should be the capacity for arbitration in landlord/tenantdisputes, perhaps vested with local NGOs or neighbourhood associations, andsafeguards against arbitrary eviction. For the poorest, their security should rest withgovernments and Sundaram (1990b) suggests hostels to provide accommodation for

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single, working women and night shelters for the homeless, such as those beingconstructed in all metropolitan cities in India.

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Chapter VII. Agenda for future work

This chapter is concerned with two primary issues; firstly, from the foregoingaccount of the human settlements conditions of the urban poor and a discussion ofsome of the key issues, it sets out an agenda for future research and direct supportconsidered necessary to establish a sustainable approach in addressing the problemsof urban poverty and degraded shelter and environmental conditions. Secondly, itconsiders the changing roles of the public sector, of NGOs and CBOs, and theprivate commercial sector in seeking to counter the deterioration of humansettlements conditions.

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Chapter VII. Agenda for future workA. Countering urban poverty

In view of the increasing numbers enduring urban poverty in various regions ofthe world, the most pressing task for action is to explore systematically ways ofcountering this growing trend effectively. In some countries undergoing SAPs theWorld Bank has been persuaded of the need for compensatory programmes ofintervention to mitigate the most adverse consequences of macro-economic reform.These programmes have included a reallocation of public expenditure to protectareas of social provision such as primary health care and education, and othermeasures have included public employment schemes and a targeted programme ofnutrition and food assistance (Moser and others, 1993). But as UNICEF hassubsequently pointed out, "these programmes do not ... attack the root causes ofstructural poverty" (van der Hoeven and Anka, 1994).

There is, therefore, an urgent need to complement the 'safety net' strategy of theWorld Bank with a pro-active programme which systematically and exhaustivelyexplores the opportunities afforded by shelter and human settlements developmentand upgrading as a means of creating economic opportunities for the urban poor.This theme has underpinned work undertaken by UNCHS (Habitat) and ILO forsome time and this report strongly endorses the establishment of the Urban PovertyPartnership Programme. This inter-agency initiative seeks to address:

"practical measures to generate or increase productive employment of peopleliving in low-income communities — including labour-intensive urbaninfrastructure projects, micro-enterprise initiatives, and supporting creditschemes;

measures to improve the physical living conditions of residents in low-incomecommunities — their housing, sanitation, water supply, waste disposal,drainage, access roads; and

opportunities to share in the planning, prioritizing and implementation of localdevelopment, and to gain greater access to and influence over resources forlocal development which could improve employment, incomes and physicalliving conditions" (Ministry of Foreign Affairs, the Netherlands, 1993).

The programme will operate at the community level, seeking the genuineparticipation of poor communities in local programmes drawing in NGOs, CBOs,local and central governments and the private sector in a partnership approach tomaximize opportunities for the urban poor. By combining their expertise andresources, and indeed by inviting the participation of other donors, the UnitedNations agencies hope to 'maximize synergy' between their individual programmes.UNCHS (Habitat) and ILO have recently made a number of more detailedrecommendations in respect of employment generation from shelter provision and

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human settlements development. These include:

the call for an urgent shift in attitudes and approaches which links shelterprovision and major public works programmes to anti-poverty strategiesthrough the use of labour-intensive initiatives to create unemploymentopportunities for the urban poor;

the encouragement of a positive environment for small-scale contracting inshelter provision and upgrading through training and advice and guidance; theavailability of raw materials and local sources of finance; and theempowerment of households to be able to deal with small contractors;

the acknowledgement of shelter as a workplace and the encouragement ofHBEs; and

the development of a series of pilot projects to examine the potential ofsmall-scale contracting in scaling-up the level of low-cost shelter provisionand in exploring ways of integrating work-place and residential space in avariety of different circumstances.

An important element of this new approach will be a need to share experiencesand ideas between organizations and communities, which in turn also emphasises theneed for an effective monitoring role and the wide dissemination of findings. Theseprogrammes also afford an important opportunity for a more detailed research rolewhich should be carefully considered. Amongst the wide range of potential topicsfor comparative research, for example, could be the economic impacts on poorcommunities of labour-intensive approaches; or social issues, such as the effect oflocal programmes on the role of women; the impact of such programmes on socialcohesion, integration and self-reliance; or issues of urban governance, such as theorganizational dynamics between CBOs, NGOs and municipal authorities. In orderto be effective, the research programme needs to be planned as an integral part ofthe local programme and designed in such a way which contributes directly to theimplementation of the programme itself.

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Chapter VII. Agenda for future workB. Shelter, good governance and the enabling role

A second issue of major concern is the capacity and competence of urbanadministrations to deliver effective public services within an enabling framework inthe area of shelter and urban infrastructural provision. The new role perceived by theinternational agencies implies three major areas of responsibility for local authorities:

they will continue to deliver certain core services to the community, e.g. basicservices such as nutritional programmes, primary health care and education;

they are to assume responsibility for providing a strategic policy frameworkfor the delivery of urban services; and

by working with or through other bodies (i.e. NGOs, CBOs and the privatesector), they are to ensure the enablement and regulation of service deliverywithin the context of the strategic policy framework.

Batley (DAG, 1994), argues that these enabling and regulatory roles "assumethat government has the capacity of oversight, analysing the operation of markets,identifying the need for intervention and setting the policy framework for othersectors". Yet, "there is scarce evidence" that such administrative capacities exist inmany developing countries. The development of shelter strategies is one area whereenablement is highly advantageous and there is an urgent need for local authorities toacknowledge the contribution of poorer communities and work closely with them.But in the context of the chronic and increasing need for shelter, scarce anddeclining public sector resources, poor market conditions, a weak political andadministrative framework and a demoralized public sector in the wake of thedepletion of resources through SAPs, the formulation of enabling shelter strategieswill be very challenging indeed. Such strategies will demand innovative thinking, theforging of new relationships and administrative procedures, the need for an overhaulof old regulatory structures, and the capacity for analysis and a more entrepreneurialapproach. This is a highly challenging agenda with intrinsic technical and politicaldifficulties for which there is no prescription and very little guidance.

The international agencies and indeed some governments are already committedto strengthening urban local government through the decentralization of powers andfunctions, but if these new responsibilities are to be effectively undertaken thereneeds to be much greater support for the public sector and a major internationalinitiative in training, guidance and support for local authorities. In the shelter sector inparticular there is an urgent need for training and institutional development toincrease the competence of technical officers, administrators and politicians inseeking to identify shelter solutions for the urban poor in the context of more marketoriented strategies. Such an initiative needs to incorporate a research orientedapproach similar to that embodied in the UNCHS (Habitat)/DANIDA Community

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Development Programme, in order to draw on emerging international practice and tobuild an analytical capacity into enabling strategies which increases their relevancefor the urban poor. An integrated research and training programme would identifygood practice, highlight successful partnerships, record procedural arrangementsand seek to explore other effective mechanisms for extending shelter to the urbanpoor. Through training, good practice guidance and publications it woulddisseminate such information as widely as possible.

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Chapter VII. Agenda for future workC. Specific policy areas in need of development

Whilst the capacity of local authorities to adjust to new roles needs greatersupport, it remains the case that the preconditions necessary for the development ofmarket mechanisms in the shelter sector are also poorly developed in manydeveloping countries. One may highlight by way of example three particular areas ofactivity:

the legal and institutional environment for the ownership, transference, andmanagement of land;

personal savings and private sector institutional housing finance; and

the underdevelopment of local materials production, marketing anddistribution.

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1. Improving the effectiveness of the land market

The ownership and control of land remains a fundamental issue perpetuatingpoor housing conditions in developing countries, and as observed earlier (seesections VI.E. and VI.F.), the effective operation of the land market is also essentialto the development of institutional housing finance. A shift towards marketmechanisms will require a more effective legal and institutional framework for theplanning, registration and disposal of land. A greater emphasis on marketmechanismsper se, however, is unlikely to operate to the advantage of the urbanpoor unless local authorities have the competence, procedures, financial resources,and political will to intervene more effectively in the land market, and via a range ofmeasures such as those outlined in section VI.E., to ensure a regular supply ofdevelopable land, directly available for their use. Whilst both these areas, i.e. thelegal and institutional framework and the competence of, and resources available to,local authorities, need strengthening, there is a danger that the drive towardsprivatization will eclipse the imperatives for intervention, and most particularly, willnot yield the financial resources necessary for local authorities to purchase landdirectly on behalf of the urban poor.

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2. Encouraging the development of institutional housing finance for the urban poor

The urban poor are also disadvantaged by their lack of access toinstitutionalized credit and whilst market circumstances have been far from ideal inrecent years for the extension of credit facilities to low-income groups, informalcredit mechanisms remain widespread, and a number of initiatives have occurred.These initiatives to extend "down-market" lending appear to reflect two differentbasic approaches. Firstly, existing housing finance institutions are seeking tocircumvent the perceived problems of high risk and high transaction costs bymodifying conventional lending criteria. Typically this means on-lending earmarkedfunds at subsidized interest rates and over longer terms in order to extend lending tolow-income groups. To overcome problems of access for clients, housing financeinstitutions are seeking to work in partnership with NGOs. In this 'facilitated lending'situation, the loan is made directly by the housing finance institutions to theborrower, but the NGO may assist with the loan origination and servicing.

In the second case, financial intermediation is done by a community-basedfinancial institution using funds loaned by an housing finance institution or otherfinancial institution. In these circumstances the community based-finance institutionseeks to tailor loans more appropriately to the needs and affordability of the poor(most particularly in respect of the absence of security), and also uses its peer groupassociation to reduce risk. Several changes to conventional lending practice areenvisaged, however, and these include a wider use of insurance cover, theestablishment of a 'delinquency risk' fund linked to recovery performance, and loanspreads which ensure coverage of the higher transaction costs associated with alarger establishment (Mehta, 1994).

Both of these innovatory credit arrangements are in their infancy. Muchtechnical and advisory support has already been forthcoming from national andinternational sources and much remains to be done before the projects may bedeemed to be effectively operational. It will be necessary to initiate pilot schemesand to monitor and evaluate the outcomes, but these are important initiatives whichappear to offer great scope for application amongst poorer groups in many otherdeveloping countries.

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Chapter VII. Agenda for future workC. Specific policy areas in need of development3. The enhancement of local materials production

Section VI.G. illustrates how the production of indigenous building materialshas not been able to keep pace with demand and that the cost of materials in manydeveloping countries has risen steeply in recent years. At the same time, localmaterials production is often characterized by low productivity, fragmentation,problems of distribution and poor marketing. Increasing the efficiency andorganizational capacity of local materials production in particular countries wouldseem to offer a number of advantages, such as, increasing economic output andreducing the need for costly imports; increasing supplies to reduce shortages andtherefore costs; providing increased job opportunities, especially for women andlow-income groups; and encouraging low-cost shelter options for the urban poor.

For these reasons this report endorses the recommendations made by UNCHS(Habitat) on building materials for housing in 1992 (see section VI.G.) (UNCHS,1992a). The latter report advocates that operational strategies at national level shouldconcentrate on developing, transferring and diffusing new technologies; creating asupportive policy environment and strengthening institutional support. It alsostrongly recommends greater cooperation amongst developing countries, especiallyon a regional basis, in sharing ideas, experience and expertise, as well as greaterNorth-South cooperation to provide appropriately targeted development finance,improved technology, and technical expertise. In supporting these recommendationsthis report highlights the need for national strategies to maximize the benefits forlow-income groups, and especially women, in terms of job opportunities and trainingin the production, distribution and sale of materials; in promoting easier access tolocal materials for self-building purposes or renovation; and in encouraginginnovative says of reducing the costs of materials, e.g. through bulk purchasearrangements or building-materials 'banks'.

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Chapter VII. Agenda for future workD. Strengthening shelter strategies for the poorest groups

In seeking to strengthen shelter strategies for the very poorest groups there is aneed for action at two levels, firstly, at central government level in persuadinggovernments not to abrogate their responsibilities to the urban poor; and secondly,at the operational level, to use such resources as are available in the most effectiveway to promote the interests of the poorest.

For many years housing investment came to be perceived by governments as adrain on scarce public sector resources. Recent shifts in international policiesthrough SAPs and the GSS have imposed tight restrictions on public expenditureand encouraged a more market oriented approach towards shelter provision. Giventhe severe economic problems confronting governments in many developingcountries and the lack of political influence exercisable by the poorest groups, thereis a danger, as articulated by Coulomb (1994) in Mexico, that shelter issues will slipeven further down the list of priorities as governments' feel that such problems arenow to be dealt with more appropriately by market forces. There remains a need tocounter such perceptions by strongly promoting the arguments outlined by UNCHS(1994) and UNCHS/ILO (1995) and elaborated in chapters III and VI above,favouring enhanced investment in the shelter sector, not only from an economicperspective but also from the health and environmental viewpoints advocated byAgenda 21. Habitat II will provide an important international opportunity forpromoting the case for greater investment in shelter and human settlementsdevelopment.

Invariably, however, public sector resources will remain modest in relation tothe shelter needs of the urban poor, hence the need to consider carefully the use ofthese resources in local shelter strategies. Local authority staff as well as those inNGOs are likely to need training and institutional support in order to formulate andimplement strategies which determine priorities and use appraisal techniques to makebest use of scarce resources between various policy options. These options arelikely to include, the acquisition of development land for the urban poor; low-costnew build programmes (e.g. sites-and-service schemes); incentives to encourageslum improvement programmes; infrastructual investment and relocation projects;the use of public funds to lever private resources through partnerships; theformulation of incentives to encourage 'responsible renting' in the privately rentedsector; and the direct use of resources for shelter provision for the mostdisadvantaged groups, such as, street children, the homeless, the physically andmentally handicapped, some women-headed households, etc., a sadly neglected areaof local policy. Currently only the authorities of the largest cities are capable ofconceptualizing strategies of this kind and working towards their implementation. Forenabling strategies to work, however, this implies that local authorities will have toanalyse and respond to the local housing market in a way they have not done

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hitherto. It also implies accepting more directly responsibility for formulating localpolicies which make provision for the neediest groups.

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Chapter VII. Agenda for future workE. Harnessing the benefits of research

The World Bank (1991) has decried the apparent reduction in urban researchactivity during the 1980s and called for the "reactivation" of urban research in the1990s. Others have pointed out that there is a growing "gulf" between the researchcommunity and the agenda for action by practitioners in the field of shelter andhuman settlements development. Both of these statements implicitly underline theimportance of research to urban policy development and the need for a stimulatingpolicy dialogue between research and practice. Whilst there is no shortage of ideasfor research, in recent years there has been a shortage of resources to supportcritical and substantive research programmes.

There are a variety of roles which research can fulfill and it is relatively easy toidentify recognizable gaps in research coverage. Firstly, in reviewing areas offundamental or substantive research it is possible to identify several areas whichneed to be addressed. There has been, for example, remarkably little research whichhas analyzed the impact of SAPs and macro-economic reform on the shelter policiesof developing countries. Secondly, whilst policy-makers advocate increasedrecognition of the role of the privately rented sector there is little understanding ofwhat this means in terms of living conditions, landlord-tenant relations, or the level ofrents payable. Initiatives designed to promote private renting are few and far betweenand there is little knowledge of what incentives or safeguards may be necessary toencourage 'responsible renting' as a component of shelter strategies. Thirdly, whilstthe World Bank has established its Housing Indicators Programme and UNCHS(Habitat) has more recently begun an Urban Indicators Programme, there has beenvery little research which seeks to understand the dynamics of local housing markets,or indeed whether a 'market', as such, exists at all! Each of these areas (and there areothers), raises some fundamental questions for policy-makers which are notcurrently being addressed effectively.

A second role for research is monitoring and evaluation. Such research isusually linked to an innovative project or area of policy. There is considerable scopefor additional monitoring and evaluation work especially in association with theshelter initiatives of international agencies. There are also other important shelter andurban development programmes where monitoring ought to be included and iscurrently absent or ineffective in feeding back into decision-making.

Thirdly, research may be used to identify and promote innovation and goodpractice. A good example of such a research programme already mentioned is theUNCHS (Habitat)/DANIDA Community Development Programme (see sectionVI.D.) from which a worldwide capacity for advice, guidance and training has beendeveloped. If additional resources were forthcoming from international donors, thiskind of research/action could be extended to include other policy areas, e.g. local

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economic development and shelter partnerships.

By definition the two former types of research are prescriptive, i.e. the areas ofwork may be defined and research bids invited, whilst the latter is more responsive,i.e. the research depends on the initiatives and their location. There is a need toharness all three types of research and, in the context of the increasinginternationalization of global shelter strategies, to ensure an increasingly comparativedimension to shelter and urban research programmes. The international researchcommunity is responding organizationally to this need through the formation ofshelter research networks. The European Network of Housing Researchers hasgrown rapidly since its inception in 1989; an Asian Housing Research Coalition hasrecently been established and an African network is proposed. With encouragementand support these networks should facilitate more effective communication betweenresearchers, practitioners and donor agencies, more effective dissemination ofresearch findings, and provide greater scope for inter-regional researchcollaboration.

Habitat II provides an invaluable opportunity for restoring the policy dialoguebetween researchers and practitioners, but this dialogue also needs to include donoragencies. It is important that one of the aims of Habitat II should be to identify andacknowledge a research agenda for the future, arising out of the debates and policydecisions of the Conference. This needs to be complemented, thereafter, by aregular series of events, workshops, seminars and conferences, organized aroundmajor policy issues associated with urban development and the GSS.

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Chapter VII. Agenda for future workF. The future role of local authorities

The three major roles envisaged for local authorities have already been outlinedand discussed (see section B above), this section will seek to explore some of theimplications of these roles for human settlements development. Local authorities willbe expected to assume a more strategic function. This implies that they will beexpected to increase their effectiveness in at least three areas of urban development,firstly, in urban planning and land management. They will be expected to anticipatepopulation growth and urban expansion and to exert greater control over thatexpansion in accordance with a planned strategy which seeks to maximize the use ofresources whilst minimizing the growth of illegal and squatter settlements. Secondly,they will need to plan carefully the provision of infrastructure not only for it to beeffectively coordinated with planned urban growth, but also to extend its coverage ofthe existing urban environment. Thirdly, local authorities will be expected to begin toformulate local shelter strategies which seek shelter solutions much more within thecontext of the operation of the local housing market. The adoption of a strategicapproach implies a much more pro-active and entrepreneurial approach than mostlocal authorities are accustomed to, a substantial improvement in their informationbase and a greater analytical capacity than hitherto.

For the implementation of these strategies local authorities are expected tocontinue with some of their core administrative activities, e.g. land-use planning, butto rely increasingly on an enabling approach to secure policy objectives. Hence, it isanticipated that local authorities will increasingly withdraw from the role as a directprovider of shelter (except perhaps with respect to the poorest groups), in favour ofa greater reliance on other bodies (CBOs, NGOs and the private sector). Principally,as far as programmes for the urban poor are concerned, this will mean working moreclosely with NGOs or with the communities themselves. This will again involve localauthorities in a more pro-active, creative and catalytic role than hitherto, seeking toexplore innovative solutions to the backlog of shelter, providing technical advice,guidance and incentives to encourage upgrading, working with NGOs to secure newbuilding arrangements, exploring potential partnerships with landowners anddevelopers, and so on.

Local authorities must also retain their role as regulators, however; a role whichis performed with enormous variation in developing countries from the exercise ofDraconian powers to a practically non-existent influence. In this role local authoritiesare having to adjust to a presumption in favour of more market-oriented strategieswhich will require major changes in attitudes and approaches. Calls have been made,particularly in the areas of building and planning regulations, for example, for greaterflexibility in the exercise of codes and standards. Whilst the liberalization of codesand standards is justified, it does highlight the need for enhanced professionalcompetence in making judgements which safeguard the health and safety interests of

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the community at the expense of the individual.

In conclusion, these new roles for local authorities, in seeking to developenabling strategies in shelter and human settlements development, will be highlychallenging.

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Chapter VII. Agenda for future workG. The role of CBOs and NGOs

The GSS places great emphasis on the role of CBOs and NGOs. This is arecognition of the reality that low-income communities themselves are the mainproviders of low-cost housing in developing countries and that these communitiescan provide housing at lower cost and on a much larger scale than governmentorganized programmes (UNCHS/ILO, 1995). To improve the quality of informalsettlements and extend infrastructure, however, and to ensure minimum standards innewly built settlements, these communities require a clear policy framework andsupport from government as well as readily available advice, guidance andorganizational support from intermediary organizations, such as NGOs.

As outlined earlier (section VI.A.), UNCHS (Habitat) acknowledges that NGOsexercise comparative advantage not only in working with local communities toproduce low-cost shelter and infrastructural provision, but also in mobilizing thosecommunities and mediating between them and government officials or the privatesector (UNCHS, 1993b). Turner (1988), also identifies three roles for NGOs inhuman settlements development, first as enablers of CBOs; secondly, as mediatorsbetween communities and the authorities controlling access to resources, goods andservices; and thirdly, as advisors and consultants to those authorities on ways ofamending rules and regulations in order to permit greater freedom for communities todevelop and to access resources. They may also act as technical advisers to thecommunities themselves and provide training as part of their repertoire of activities.

NGOs and CBOs are by definition, however, very diverse organizations. Theyare unelected, or voluntary, organizations and whilst they may employ staff, they areinvariably non-profit making bodies. They are inspired by a social commitment andtheir accountability is vested in the local communities they serve. They also vary verymuch in size, organizational structure, capacity and technical competence. Hence,the precise nature of their activity and the role they perform is often locallydetermined. In seeking to harness the involvement of NGOs in local shelterstrategies, therefore, the task confronting governments is how to provide a clearpolicy framework within which very divergent NGOs can make a positive localcontribution.

Experience suggests that this is not an easy proposition. Whilst there are manyexamples of effective partnership arrangements between governments and individualNGOs, involving NGOs in a strategic way appears to be more problematic. In Chile,for example, following the restoration of democracy in 1990, the governmentembarked on a national shelter strategy which sought the collaboration of NGOs in acommunity-based, participatory programme targeted on the poorest households.The involvement of NGOs, however, has not worked as well as was expected:"On the one hand these organizations are few, they do not exist all over the

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country, and they normally work on a small scale. On the other hand, thecoordination and collaboration between the Ministry of Housing and the NGOshas led to significant problems that in some cases have ended in many NGOslosing interest in [participating in] the [Progressive Housing Programme]"(Fernandez Prajoux, 1994).

The principal problems alluded to were, firstly, over the legal status of NGOsand the exclusion of any political activity from their remit; secondly, the financialstrength of NGOs and most particularly those in receipt of government finance fordevelopment; and thirdly, difficulties in arriving at mutual procedures betweengovernment and NGOs. Alongside these problems, difficulties have also arisen overthe levels of funding made available to NGOs, and over what the NGOs regard asexclusion from decision-making over policy.

The work undertaken by the NGOs confirms the advantage of theirinvolvement, however; "the programmes which involve NGOs strengthen thesolidarity of the groups living in extreme poverty and improve their quality of life asan expression of a new type of relationship within a more democratic and equitablesociety" (Fernandez Prajoux, 1994). What the Chilean experience demonstrates, isthat despite a strong and mutual commitment to a collaborative working relationshipit takes time and considerable effort to develop workmanlike procedures in aworkable partnership.

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Chapter VII. Agenda for future workH. The role of the private commercial sector

The enabling approach to urban administration envisaged by internationalagencies sees a broader role for the private sector and indeed the privatization ofsome functions previously the responsibility of government bodies. Since the mainconcern of the commercial sector is profitability, it is not immediately apparent thatthis will improve circumstances for the poorest groups. It must be remembered,however, that these groups are often already dependent on the private sector for anumber of urban services. Renting from a private landlord, for example, is verycommon amongst low-income groups; water may be purchased from vendors if apublic supply is not available; and urban forms of transport are often also privatelyowned.

The increasing emphasis on the private sector, however, implies that in seekingto improve or enhance provision for the urban poor, whether it be in terms of theavailability of land for development, the provision of shelter, or improvements ininfrastructure and urban services, local authorities will increasingly have to seeksolutions which draw on the resources of the private commercial sector. Theimplication of this is increasing dialogue between the sectors over issues of urbanmanagement and service delivery. Already in many developing countries, often as aconsequence of SAPs, there are discussions of this kind over the delivery of basicservices such as water-resource management and solid-waste disposal. One wouldexpect this kind of dialogue, or joint working, to extend to issues such as theavailability of land for development in order to seek to resolve current difficultiesover land scarcity and the absence of land for the urban poor. The development oflocal shelter strategies is likely to involve similar types of discussions between localauthorities and housing developers, land holders, landlords, financiers, and others, inan attempt to examine potential partnership solutions to improvements in shelterprovision.

One area in which the private commercial sector has been active for some timeis in seeking to extend credit facilities to low-income groups for shelter developmentand upgrading. Although these developments are tentative at present (see sectionVI.F), they are likely to become more important in future.

A further area of activity in which the involvement of the private commercialsector is likely to be much more actively sought in the future is in the field of localeconomic development as part of poverty alleviation strategies. Advice and guidancefrom the private sector is likely to be increasingly needed in the area of SSE andHBE development (and encouragement). Private sector expertise is also likely to benecessary in developing training programmes in relation to local labour needs anddeveloping local enterprise strategies (UNCHS/ILO, 1995).

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Chapter VIII. Conclusions and recommendationsA. The incidence of urban poverty

One of the most important conclusions of this study is that both the incidenceand volume of urban poverty are increasing in parts of the developing world. WorldBank estimates of (income) poverty ( table 7 ), demonstrate that whilst the overallincidence of poverty in developing countries is decreasing and is expected tocontinue to fall to the year 2000 this is largely predicated on an improvement incircumstances in the Asian region, and particularly East Asia, where both theincidence and volume of poverty have fallen, and are expected to continue to fall, tothe year 2000. In contrast, the incidence of poverty in sub-Saharan Africa, NorthAfrica and the Middle East and in Latin America and the Caribbean has grown overthe latter part of the 1980s; and whilst it is likely to fall again in North Africa and theMiddle East, improvement is expected to be marginal in Latin America, andcircumstances are anticipated to continue to worsen in sub-Saharan Africa before theyear 2000.

As far as the volume of poverty is concerned, the actual numbers sufferingfrom poverty increased in all regions of the developing world, between 1985 and1990 with the exception of East Asia, and it is only in the Asian region (andparticularly East Asia), where they are expected to fall again before 2000. Thenumbers in poverty in sub-Saharan Africa, for example, are expected to increaseover the decade by 40 per cent.

These figures describe the situation as it relates to poverty as a whole. ChapterI demonstrates the rate of urbanization in developing countries, however, and showsthat urban poverty is increasing much faster than its rural counterpart. Moreover, theestimates provided in chapter IV relate specifically to urban poverty, and whilst theyare uneven in coverage and not always comparable, they tend to confirm thepessimistic picture of the late 1980s, as well as indicating that in some of the largestcountries of the world, the numbers experiencing urban poverty are continuing togrow into the 1990s. Indeed, projections for individual countries in Asia (e.g.Bangladesh, India and Indonesia), a region in which the World Bank anticipates a fallin overall figures before 2000, suggest that those experiencing the problems of urbanpoverty may continue to rise throughout the decade unless there is a significantupturn in the economic environment affecting these countries in the meantime.

Much poverty in developing countries is the result of structural economic anddemographic factors which are likely to require long term policy responses relatingto economic growth and development. But, at the same time, increasing exposure tothe international economic environment is resulting in short-term economic effectsand fluctuations at city-regional level which influence agglomeration economies indifferent ways and contribute to the growth (or decline) of the numbers in poverty ina cyclical way. The report also confirms that it is women who have borne the brunt

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of the problems of poverty, and that deteriorating economic circumstances over thelast decade or so have invariably impacted most adversely on the role of women.The survival strategies devised by poor households, for example, to cope witheconomic adversity and 'shocks' invariably impose enhanced burdens onto femalemembers of the household. Women-headed households are particularly vulnerableand they constitute a high and growing percentage of all households. Other groupsdisproportionately represented amongst the urban poor include large families withhigh dependency ratios; those vulnerable to fluctuating employment opportunities atthe lower end of the market, e.g. the handicapped or newcomers to the city; thoselacking basic education or who are illiterate; and those with no social support, suchas street children or destitutes.

The policy implications of these factors in respect of poverty alleviationstrategies highlight the need to safeguard programmes of human resourcesdevelopment during longer term, macro-economic adjustment; to develop long-termpolicies which begin to tackle some of the structural causes of poverty, such asgender inequality and low productivity in the informal sector; and at the same time todevelop the capacity for short-term employment programmes which countervulnerabilities arising in increasingly volatile local labour markets.

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Chapter VIII. Conclusions and recommendationsB. The human settlements conditions of the world's urban poor

Although they are closely linked, a distinction is drawn between income, orsubsistence poverty, and housing and urban poverty. Housing poverty is not simplya question of affordability issues, it may include those living in shelter andenvironmental conditions which are insecure, life-threatening, or which pose animmediate danger to their health and well-being. Between 30 and 60 per cent of thepopulation in developing countries reside in illegal settlements or in overcrowded anddeteriorating tenemental structures (UNCHS, 1994). There is clearly a strongcorrelation between those who are poor, when measured on a subsistence basis,with those living in slums or informal settlements, but it remains the case thatsometimes a significant proportion of slum dwellers are not necessarily poor in termsof income. The implications of this are twofold; first, it suggests that estimates ofincome poverty are likely to underestimate the total number of those living ininsecure or unsatisfactory shelter environments; and second, that the shelter sectoritself is under-developed in that the supply of satisfactory accommodation isdeficient even for those who could afford to pay for higher standards of housing.

Chapter IV reviews the human settlements conditions of the urban poorthroughout the developing world. Whilst variations in circumstances do exist, apicture emerges in most developing countries where the shelter sector isconspicuously under-developed. This is reflected by a situation where there is oftena huge shortage of housing; where the demand for land and housing far exceeds thesupply available; and the subsequent price of formal housing provision is onlyaffordable by the middle- and high-income groups. In such circumstances there islittle option for the lower-income group and the urban poor but to reside in illegaland/or informal slum settlements, or to squat.

The illegal status of these unauthorized settlements leads to problems for localauthorities and slum dwellers alike. For local authorities the existence of suchsettlements precludes the effective planning and allocation of land uses and theprovision and coordination of infrastructure and other essential services. In someinstances the lack of control over development results in slum settlements occurringin dangerous or unhealthy locations. For the slum dweller, in addition to the physicalhardships, privations and health risks associated with such developments, there isthe problem of insecurity of tenure and threat of eviction. In recent years,government officials and policy-makers have become more sensitive to the issue ofsecurity and most governments are now willing to consider the regularization of slumsettlements. Major problems remain nonetheless and without legal title slum dwellershave little incentive to invest either in their property or in their settlement.

Chapter IV also seeks to identity trends in human settlements conditions overrecent years and despite the plethora of data on slum settlements, projects,

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infrastructural provision, etc, the absence of comparable data series is a serioushandicap. Much of the data available is also averaged, which often conceals the truecircumstances of those living in the worst conditions (see for example, sectionIV.E.). As far as the specific circumstances of the urban poor are concerned there ismore evidence of a deterioration in conditions than of any marked improvement.Circumstances also vary within and between regions as the policies of somegovernments in targeting the poor are more effective than others. In very broadterms, there is evidence of an improvement, both in shelter conditions and in theprovision of infrastructure and services for the urban poor, in a number of countriesof East Asia and the Pacific.

In the larger countries of South Asia (including India), whilst overall housingand infrastuctural indicators demonstrate a steady improvement in human settlementsconditions, despite the efforts of governments, there is not much evidence to showthat these improvements are being shared on any scale by the growing numbersliving in urban poverty.

In Latin America the recession of the 1980s has had a dramatic effect on theshelter sector and on human settlements conditions. Again, whilst circumstancesdiffer from country to country, a generalized picture emerges of deterioratingfinancial conditions leading to a collapse of institutional structures supporting marketoperations; the consequential growth of informal settlements; a growing backlog ofhousing need and a widespread deterioration in housing and environmentalconditions. As in other regions, there are those amongst the urban poor who willhave benefitted from shelter projects and upgrading schemes, but in the context ofthe overall deterioration in conditions there is very little prospect of any systematicimprovement in the quality of life of the urban poor.

Circumstances appear to be at their worst in sub-Saharan Africa, however.Here, rapid urbanization is overwhelming the resources of municipal bodies on agrand scale. Many countries have large and growing shelter deficits; there is a verysubstantial gap between supply and demand in housing for the poor; there is agrowing disparity of affordability of the poor for even the most modest formalhousing provision; an increasing proportion of the urban population live in slumsettlements where densities and occupancy levels are increasing but incomes falling;and many slum settlements are without infrastructure or basic services. Not only arethe numbers in housing poverty increasing but the conditions under which they liveare rudimentary and the provision of essential services sometimes non-existent.

This generally bleak picture of the deterioration of human settlementsconditions in many parts of the developing world calls in question the effectivenessof the role of governments in providing shelter and basic urban services for thepoor.

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Chapter VIII. Conclusions and recommendationsC. The shortcomings of past policies and initiatives for improving the conditions of the

urban poor

Attempts by governments to address the human settlements conditions of theurban poor have varied enormously in the developing world. Some governmentshave made great efforts, whilst others have scarcely addressed the problem at all.The review of human settlements conditions in chapter IV and the case studiesoutlined in chapter V demonstrate both the diversity of approaches from difficultgovernments and the difficulties and shortcomings of these initiatives in attempting totarget the urban poor. Almost without exception however, and whatever the array ofpolicy initiatives and projects developed, these measures by governments have failedto keep pace with the scale of the problem. A variety of reasons may be advancedfor this and at various levels, e.g. the lack of a strategic overview and an appropriatepolicy framework for action; the absence of an effective legal and institutionalframework; and a shortage of resources commensurate with the scale of theproblem. Each of these factors is pertinent to the role of many governments indeveloping countries. Whilst at the operational level, one might argue factors suchas, a lack of necessary professional skills and competencies, or hideboundbureaucratic processes and a rigid regulatory framework and, once again, theinsufficiency of financial resources. The evidence is overwhelming, however, that theresources available to governments alone can scarcely do more than scratch thesurface of the problem and that there is a need for a much more concerted effort toseek to improve the housing and environmental conditions of the poorest groups.

Moreover, the failure of government policies and programmes to make aneffective contribution towards shelter provision for the urban poor has two furtherimplications; first, it emphasises the much greater productivity of the efforts of thepoor themselves, albeit in adversity. Second, it underscores the need for a majorshift away from past approaches and to the adoption of a new set of policies whichnot only legitimates the efforts of the poor but also provides the necessaryframework and support which will enable increasing levels of output in a moreeffectively planned way.

If government policies and initiatives have been found wanting in the past,however, projections of future growth rates of the urban population in developingcountries provide yet another imperative for a major shift in the emphasis andapproach of shelter programmes. Projected growth rates show that by the year 2005more than half of the population in developing countries will be living in urban areas.Moreover, if projected growth rates are reasonably accurate over the next threedecades, urban areas in developing countries will by 2025 contain nearly 50 per centof the global population, compared to less than 25 per cent today. In fact,three-quarters of the total net population increase is currently occurring in the urbanareas of developing countries. The urban areas of developing countries are currently

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growing by some 65 million each year.

Given the enormity of the problems currently confronting municipal authoritiesin providing low-cost shelter, land for development, and in seeking to ensure theprovision of basic services, this suggests problems of even greater magnitude in thefuture. If these problems are to receive the priority and resources necessary to betackled effectively then there is a need in many countries for a radical transformationof current policies of housing and urban development.

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Chapter VIII. Conclusions and recommendationsD. The key principles of the GSS and the new agenda for development

This report concludes with the view that, if the problems of shelter provisionfor the urban poor and the deteriorating conditions of human settlements indeveloping countries are to be genuinely addressed, then many governments urgentlyneed to introduce radical changes in their housing and urban development policiesalong the lines of the GSS. In its key principles the GSS seeks to:

Introduce and refine the concept of an enabling framework for housing andurban development for government bodies. At central government level thisimplies the introduction of legal and institutional reforms to encourage thedevelopment of a healthy housing sector. This involves, for example, creatingthe necessary framework to secure the efficient planning and administration ofurban land; seeking to create a financial environment conducive to thedevelopment of institutional housing finance; strategically reviewing theorganization and structure of the building materials industry, and so on. Atlocal government level it represents a highly significant change inadministrative culture which shifts emphasis from a bureaucratic andregulatory regime to one which is more strategic, pro-active andentrepreneurial in outlook. It requires the adoption of a more strategicapproach towards urban development and the shelter sector; the review of thelocal regulatory framework of building bye-laws and planning standards andtheir replacement with more realistic and flexible requirements; the need towithdraw from the direct production of housing in favour of a morefacilitative role working in partnership with other housing providers andactors in the local housing market.

Adopt locally-based, city-wide programmes which target the deterioration inliving standards and shelter conditions of the urban poor. Such programmeswould involve community development, capacity building and self-helpapproaches to galvanize the support and labour power of low-incomecommunities in a concerted attempt to draw up local programmes of actionto combat poor living conditions, environmental degradation and the absenceof infrastructural provision in slum settlements. Although local authoritieswould retain responsibility for mobilizing finance and for the strategicplanning and management of these programmes, it is envisaged that theprinciple of partnership would underpin arrangements involving CBOs andresidents' organizations at the local level, and NGOs in a technical capacityproviding technical advice, supervision and administrative support.

Link local shelter and urban development strategies in a systematic way withopportunities for employment generation for low-income groups. Suchopportunities need to be exhaustively pursued, as in the case of locally-based

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slum upgrading programmes above, but other opportunities are afforded byinfrastructural improvement programmes or major public works utilizinglabour-intensive technologies and, where possible, local materials in order tomaximize the local employment advantages. A further opportunity ispresented by exploiting the under-development of the shelter sector to createemployment opportunities for SSEs through low-cost shelter constructionprogrammes. Inevitably such initiatives, at least in the early stages, wouldneed strong local authority support in ensuring land and materials and inproviding facilities for skills training and enterprise development on asubstantial scale.

Encourage a responsible role in housing and urban development for theprivate sector. The development of a healthy housing sector also implies theactive and responsible role of the private sector not only from the perspectiveof construction where the private sector could increase the supply of housingto meet realisable demand for home ownership, but also in increasing housingopportunities for low-income groups through the provision of low-costaccommodation for rent. At the same time local authorities, in seeking toexercise their more strategic enabling role are likely to need to explore thescope for local partnerships with the private commercial sector in order tofacilitate the release of land for development, secure access to finance, orencourage the supply of rented accommodation through 'commercial'landlords.

In their local application throughout the developing world, the above principleswill require substantial elaboration and further refinement in relation to localcircumstances in order to constitute an effective enabling strategy. Nonetheless, inencouraging the development of a healthy housing sector and in concentrating thescarce resources available in the housing and urban development sector much moreeffectively than hitherto on the needs and circumstances of the urban poor, the GSSaffords a genuine opportunity in contributing to a counter-attack on the growth ofurban poverty in the developing world and in reversing the deterioration in humansettlements conditions of many of the world's urban poor. The GSS is thus thefoundation on which the "Habitat Agenda" — the Global Plan of Action of Habitat II — will be based.

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Chapter VIII. Conclusions and recommendationsE. Summary of recommendations

As indicated earlier in the report the shelter sector in many developing countriesis under-developed institutionally, in terms of productive capacity, and housingsupply. On the basis of the discussion on the preceding pages, this final sectioncontains seven specific recommendations on how to improve the human settlementsconditions of the world's urban poor. The first four focuses on the factors ofproduction. The fourth and fifth concentrates on issues of consumption, and inparticular on how changes in the use of the existing housing stock may contribute toan improvement in the shelter conditions of the urban poor. The finalrecommendation focuses on the interaction between the actors in the shelter deliveryprocess.

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1. The supply of residential land

Ensuring an adequate supply of land at affordable prices is an absoluteprerequisite for the development of an effective shelter strategy and for meeting theneeds of the urban poor. Difficulties exist at a variety of levels: many countries donot have an effective institutional structure or legal framework; there areshortcomings in the formulation of urban land policy and in the capacity forimplementation; and there is a lack of expertise in operational techniques inassembling land resources for the urban poor.

There is thus a tangible need for UNCHS (Habitat) to mount a substantialinternational effort in this area to ensure:

that legal, technical and professional advice and consultancy is available togovernments wishing to reform legal and institutional structures;

that there is a sustained international effort through technical aid and trainingprogrammes to improve professional competence and service delivery inurban land-use planning and management; and

that pilot projects are established to evaluate operational techniques and bestpractice in identifying and ensuring the availability of land for the urban poor.

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2. Sources of institutional housing finance

The absence of formal financial arrangements is a major constraint on thedevelopment of a healthy housing market, and it is a particularly intractable problemfor the urban poor. The viability of institutional housing finance is, however, closelylinked to the effectiveness of land markets and in particular with efficient registrationand titling arrangements for land. Despite the austerity of the 1980s, there have beenimportant initiatives in the development of housing finance and in particular inarrangements for the urban poor. Much technical and advisory support has alreadybeen forthcoming in respect of the initiatives to promote institutional housing financefor the urban poor, but much remains to be done before the projects are deemed tobe operationally effective. Nonetheless, they appear to offer substantial scope fordevelopment and for wider application in developing countries.

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3. Improving access to, and affordability of, building materials for the urban poor

There have been increasing problems with the supply of building materials indeveloping countries over recent years. There is thus a need for governments toconsider ways in which their indigenous materials industry can become moreefficient and effective in order to reduce costs and increase supplies. Particularrecommendations which will assist the urban poor:

There is a need to diversify the production of indigenous materials to includesmall scale producers and those in the informal sector. This is likely toinvolve a discrete programme of training and support through small-enterprisedevelopment agencies and the availability of credit facilities for thedisbursement of small loans. The small enterprise development agenciesshould draw heavily on proven private sector expertise.

Further measures should be taken to ensure the access of low-income groupsto low-cost building materials. This may be achieved via cooperativeinitiatives organized by NGOs in bulk-purchase arrangements, for example, orthe establishment of building materials 'banks' specifically for use bylow-income groups. The recycling of non-toxic waste materials for use inconstruction should continue to be explored with regard to the potential foremployment generation for low-income groups as well as benefits to begained from potentially reduced costs.

UNCHS (Habitat) should continue to ensure that professional and technicaladvice is available to governments seeking assistance in restructuring theindigenous building materials industry.

UNCHS (Habitat) should also continue to monitor good practice in ensuringthe availability of low-cost materials to low-income groups and should widelydisseminate findings.

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4. The opportunities for employment generation

Employment generation amongst low-income groups and the scaling-up ofconstruction programmes in shelter and human settlements development are at thecore of the GSS. The unskilled and semi-skilled nature of the work is well suited tolow-income groups and to women and there is a variety of different types of work inwhich the opportunities for employment may be sought. Governments, both centraland local, are strongly encouraged, therefore, to scale-up their housing and urbandevelopment activities in a strategic programme to increase employmentopportunities amongst the urban poor. Accordingly, they are advised to:

review local building standards and planning codes which, while safeguardingthe safety, security and health of households, should seek to encourageself-build and participative approaches by low-income communities;

explore opportunities for enhancing the employment of low-income groupsthrough the development of low-cost shelter construction programmes bySSEs; through the provision and upgrading of infrastructural facilities in slumand squatter settlements; through urban renewal and residential estatemaintenance programmes; and in enhancing the capacity for the use ofindigenous building materials; and

examine the opportunities for the use of labour-intensive technologies andcommunal contracts of employment in major infrastructural provision andpublic-works programmes; ensure the provision of appropriate training andsupervisory inputs (in collaboration with NGOs), and that equal access isavailable to women.

For its part, UNCHS (Habitat) needs to identify good practice from new andexisting employment-generation projects in respect of shelter and human settlementsdevelopment and to disseminate this information widely.

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5. Encouraging the availability of accommodation for rent

In view of the likely increasing demand for urban shelter in the coming decadesand the need to expand access to low-cost accommodation for low-income groups,governments are advised of the need to:

review their current policies with regard to rented accommodation to create afavourable legal, financial and administrative framework for the developmentof responsible renting strategies (such strategies might include incentives forthose wishing to sub-let part of their property, or to build extensions (whereappropriate) for sub-letting);

ensure that effective steps (such as local landlord/tenants forums), are inplace to safeguard tenants from exploitative practices; and

ensure directly provided hostel accommodation for the poorest groups, e.g.street children.

At present, policies to encourage private renting are tentative and guidelinesbroadly-based; there is a need for UNCHS (Habitat) to continue to monitor policydevelopment in this area, encourage information exchange and the dissemination ofinformation on good practice.

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6. Acknowledgement of the role of shelter also as a workplace

HBEs are very common in developing countries and their pre-eminent functionis to sustain the income of poorer households. Whilst a vast array of functions arecarried out from HBEs these functions are invariably pursued in contravention oflocal planning and building regulations. Thus although they may be treated with'benign neglect' by the authorities they are rarely perceived in a positive way. Localauthorities, therefore, need to:

review their development control regulations in respect of HBEs to grant apresumption in favour unless the operation of the enterprise contraveneshealth and safety requirements, involves hazardous or exploitativeemployment practices or infringes basic human rights; and

seek to develop a strategy of small enterprise development in respect of HBEs providing advice and guidance, small loans for development and relocationopportunities where appropriate.

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7. Encouraging partnerships between governments, local authorities and communities

The final recommendation of the report embodies the key change of emphasisin policy which lies at the heart of the GSS and is seen as fundamental to thedevelopment of an effective international effort not only in improving the humansettlements conditions of the urban poor, but also in contributing to the alleviation ofglobal urban poverty. This is the need for the development of a genuine partnershipbetween governments, local authorities and local communities and a determination tosucceed. As indicated earlier, the efforts of governments in the past to provideshelter for the urban poor have met with limited success. It is vital to thedevelopment of an effective strategy that governments harness the energies andcommitment of the poor themselves in a systematic and targeted programme ofaction. Governments will only achieve this, however, if those communities recognizea genuine commitment to community-based, participative programmes with realresources and shared decision-making, in which local authorities provide thenecessary support, encouragement and guidance to ensure the programme is put intopractice and meets its objectives.

The challenge for Habitat II is to secure those genuine partnerships.

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Documents

· The Human Settlements Conditions of the World's Urban Poor Table of Contents Preface Executive summary I. Introduction II. The concept and scale of urban poverty III. The urban