A group of laborers outside Mumbai's financial district. Vivek Prakash/Reuters

Before Habitat III kicked off this week, the UN released a report on the advantages and drawbacks of rapid urbanization.

At the Habitat III conference this week, urbanists, mayors, and national leaders from around the world are attempting to agree on a new agenda to address the challenges of global urbanization and city-building. The United Nations conference on Housing and Sustainable Urban Development will grapple with the grandest of all global challenges: urbanization. The near-universal problems of poverty, development, unemployment, inequality, climate change, energy efficiency, and violence all hinge on developing stronger, more functional cities.

In the build up to Habitat III, UN-Habitat took an important step toward those goals by issuing the 2016 World Cities Report. The report informed the global deliberations that lead up to this week’s summit in Quito, Ecuador, providing a detailed overview of the challenges that urbanizing cities face and outlining a new global urban agenda for the world. It expands on the UN’s commitment to making cities and urban growth a priority as outlined last year in its Sustainable Development Goals.

Many good things come from urbanization, the report points out. In the past, urbanization has been associated with sharp increases in economic and social development. Overall, urban areas comprise around 55 percent of the national GDP in low-income countries, 73 percent in middle-income countries, and 85 percent in high-income countries, with larger and more developed cities making the largest contributions to economic growth.

But this connection is fraying. While high-income countries have largely completed the urbanization process, the urban populations of low-income countries are projected to triple (an increase of over 500 million people) over the next 35 years. On the positive side, the fastest urban economic growth is occurring in mid-sized cities with around two to five million residents. On the negative side, urbanization is failing to produce the same kinds of benefits for many of today’s developing nations.


The report notes that the clustering of key industries, especially banking, media, and high-tech in superstar cities is creating a spiky and uneven process of urbanization. In the United States alone, just 18 sets of industry clusters generate over 50 percent of employment and an even higher proportion of the country’s economic output. Superstar cities and knowledge hubs also face problems related to inequality and affordability, which threaten their future growth.

The not-so-good side of urbaniziation

Rapid urbanization, especially in the developing world, comes with a distinct set of challenges. The divides between rich and poor places are widening. More than two-thirds of the world’s population live in cities that are more unequal today than they were in 1980. Although global poverty was reduced by half between 1990 and 2010, inequality has risen during this same period. Despite a small reduction in urban inequality, Latin America still suffers from some of the steepest inequality in the world. Meanwhile, Asian cities and countries continue to experience deepening urban inequality alongside economic growth. The chart below shows just how spiky economic output (measured as GDP) has become around the world, even among developed nations.


Still, those in the developing world continue to suffer the most. As of 2014, over 880 million people in the developing world—more than double the population of the U.S.—live in global slums (up from 791 million in 2000 and 689 million in 1990). On a more positive note, the number of city dwellers living in slums in the developing world fell from 46.2 percent in 1990 to 29.7 percent in 2014, as shown on the chart below.


Another negative byproduct of global urbanization is its drain on environmental resources. The report notes that around 67 to 76 percent of global energy is attributable to urban areas, as shown in the figure below. Of the 12 major cities included in the figure, Singapore and Los Angeles have by far the highest carbon footprints per capita.


In addition, too many urban residents—especially those in the world’s most rapidly urbanizing areas—lack adequate access to basic services such as clean water and sanitation. Across Africa, for instance, a meager 54 percent of the urban population had access to improved sanitation as of 2010. And in Sub-Saharan Africa, only 32 percent of the urban population had access to basic electricity as of 2011. Cities in parts of Latin America and the Caribbean face a similar problem. In 2010, more than 20 percent of that region’s urban population had no access to improved sanitation, while 6 percent had no access to safe water and 7 percent lacked access to electricity.

Rising to the challenge

To cope with these problems and spur a more sustainable and inclusive model of urbanization, the report lays out an ambitious urban agenda. The agenda takes shape around five key principles:

  • Protect and promote human rights in cities by providing all residents with access to jobs, healthcare, housing, and basic services, as well as a voice in public decision-making.
  • Forge more inclusive urban development across all platforms—including government, infrastructure, and economic development.
  • Empower civil society, increase democratic participation across gender, age, and class lines, and encourage collaboration among all levels of government.
  • Promote environmental sustainability by finding ways to conserve energy and resources when growing our cities.
  • Create new urban learning environments that promote innovation and the sharing of knowledge across cities and neighborhoods.

To achieve these principles, the report offers a combination of top-down and bottom-up approaches to urban development. On the one hand, real progress will require comprehensive national urban policies and the development of stronger, more effective mechanisms for urban governance. Cities around the world also need to develop and implement better methods of urban planning and design, in addition to strengthening their municipal finance systems.

On the other hand, bottom-up approaches can and should be used to empower residents and business owners to build better cities. For example, infill and land readjustment strategies can help re-purpose vacant sites for new housing or infrastructure. So-called “city extensions” can also provide city dwellers with more space to live, work, and relax while reducing sprawl and preventing slums from forming. In addition, more public spaces are needed to create a greater sense of place and a more inclusive, less segregated city.

Yet another bottom-up approach is for cities to prioritize greater access to basic services such as sanitation and infrastructure in their land-use plans and housing programs. Streets and transportation can help connect people to opportunity, and neighborhoods to one another. Perhaps most importantly, providing quality housing to all urban residents must lie at the center of this new urban agenda. Finally, cities need a new, data-driven global monitoring framework to assess how cities and nations are fulfilling this agenda.

Only by making these changes can cities hope to meet the UN’s Sustainable Development Goals over the next 15 years. Moving forward, a sweeping new urban agenda is a global imperative, as billions more people surge into cities and urban areas around the world.

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