Chapter One

Introduction
Why we study cities and their management?

There are at least 5 reasons why we study cities and their management:
(a) Nearly 50% of the world’s population lives in cities. Some statistical reports show the
%age of urban population as follows:
- in 1800, about 3% live in city
- in 1900, about 13% live in city
- in 2000, about 50% live in city

This increment is not only the product of natural population growth, but also augmented
by increased migration from rural to urban.

(b) Cities are centers of development and innovation

- new ideas originate in cities because cities are centers of education,
industrialization and cultural revolution
- The larger proportion of economic activities and innovation take place in major
cities such as capital cities, commercial cities and port cities. Hence,
Many people say that economic development is directly related to urbanization.

The reasons given for urbanization to enhance development are that:

- It results in modern means of communication
- It results in Financial institutions and
- A concentration of trade, industry, skilled manpower and decision makers in
cities make them more important.
(c). Cities are hallmark of civilization especially where Cultural Revolution takes place.
Change in attitude quickly takes place in cities and spreads over to rural areas and
small urban centers.
(d) Cities provide the advantages of economies of scale i.e. they lead to efficient
allocation and utilization of resources. Moreover, cities reduce the cost of
producing services and make easier the provision of those services.

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(e) Cities are also the concentration of poverty, crime, and congestion and environmental
degradation. This is specifically true for cities in developing countries which
attracted the attention of researchers, politicians, managers and the public at
large.

Some Basic Definitions and Concepts

Town: - originated from the old English word, ‘Tun’ meaning enclosure for protective
purpose.

- associated with fortified, fenced, hedged, place

City: is a Roman term originated from “civitas” meaning citizens.

Generally, town refers to smaller settlements and city refers to lager settlements where
there is big infrastructure.

A city

 A city is the hub of a metropolitan area. Present-day cities are products of the
industrial revolution and are generally distinguished by land area and
population. Large, industrialized cities generally have advanced organizational
systems for sanitation, utilities, land distribution, housing, and transportation.

Urban center = refers to a settlement where by the majority of population is

engaged in non-agricultural occupations such as trade (wholesale), profession,
services and other non-agricultural activities( manufacturing, handicrafts, small
scale business). In urban centers at least 50% of the population should engage in
non-agricultural activities, in some areas 75% is required.

Municipality:-originated from ancient Roma “Municipium” which means

administrative office.

In modern context, municipality can be defined as:

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 a primary political unit usually with the power of self government and defined
authority to rule the settlements.

 In other words municipalities are distinguished legal entities incorporated in to the

laws of their respective state or regions. They are expected to perform some basic
administrative and political activities in the interest of the residents.

 Thus, they have established boundaries, governing laws, elected /appointed

leaders, prepare budget and implement the same.

County: is the largest territorial and political subdivision of a state. This term is
used both in USA and UK

The original term is “Comitates” means count, which refers to imperial officials.

Metropolis: has two meanings: (1) capital city of a state or nation (2) surrounding
areas of a big city, (Peripheral areas). It originated from a Greek word polis which
means the ability to lead a community.

Hamlets: small villages which are not incorporated as a town or city. They are
similar to our urban kebeles.

Boroughs: are small urban settlements in early British local government systems.
Boroughs are the lowest in the urban hierarchy both in the USA and UK.

The criteria used to distinguish between rural and urban is some times vague. There
are two reasons for this:

1. there are no universally used yardsticks

2. the classification is highly variable from place to place.

Thus, the classification is simply contextual depending on different conditions such

as political, administrative and other factors.

However, there are loosely used criteria used as some general factors.

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Conditions for an area (settlement) to be urban:

1. Population is the first issue in studying urban settlement. Certain number of

population should be there for an area to be considered urban. For example in
Ethiopia a population of 2000 is required where as in Ghana 6000, Uganda 10,000,
Japan, 50,000, USA 2500, Canada,1000 Ireland 1500.

The range is 49000 (NB).This is because it is dictated by their country’s specific

conditions.
 Thus, one can easily understand that demographic and economic criteria on which
definitions of urban and rural areas are based can vary widely between different
nations, making generalizations problematic.
 Exceptions to rules, however, include Senegal’s main religious centre, Touba,
which is effectively a "sacred site" ruled by the religious hierarchy and where
Islamic legislation prevails over state legislation. Indeed, Touba is still classed as
a village despite an estimated population of over 300,000 which makes it the
country’s second largest settlement (Gueye, 1997).

2. Density: Measures population residing in a sq km (Km2). For instance, in

Philippines, urban areas are defined by the national census as all settlements with a
population density of at least 500 persons per square kilometre. Still there is no
universally accepted number of populations to calculate density.

3. Occupation, certain number of population must engage in non-agricultural

activities

4. Infrastructure:- it can be physical or social infrastructure

Physical: - communication, road networks, power, water, sanitation, sewerage

and facilities.

Social: - health care facilities and Education

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 For instance in Philippines, the urban status applies to centres with the following
infrastructure:
1. a parallel or right-angled street pattern;
2. at least six commercial, manufacturing or similar establishments;
3. at least three of the following: a town hall, church or chapel; a public
plaza, park or cemetery; a market place or building where trading
activities are carried out at least once a week; and a public building such
as a school, a hospital or a library. Barangays (administrative units) with
at least 1,000 inhabitants where the majority are not occupied in farming
and/or fishing are also considered urban centres (Philippine National
Statistics Office, 1992).
 In Benin, the National Institute of Statistics and Economic Analysis considers as
town any headtown of a district with a population of 10,000 inhabitants or more,
and with at least four of the following:
1. post office, tax office, public treasury, bank, running water supplies,
electricity, health centre and secondary school. Population density and
the proportion of non-agricultural activities are not considered (Tingbé-
Azalou, 1997).
 This is often the case in sub-Saharan Africa, where small towns are defined on the
basis of administrative, demographic and infrastructural characteristics even when
the majority of the population engages in agricultural activities (see Gado and
Guitart, 1996, on Niger).

 Asia remains a predominantly rural continent, with two-thirds of its population

living in rural areas in 1990.

 However, if both India and China were to change their definition of urban centres
to one based on a relatively low population threshold - as used by many Latin
American and European nations - a large proportion of their population would
change from rural to urban. In many nations, all settlements above a certain
threshold, often 2,000 or 2,500 inhabitants and, in some countries, only a few
hundred inhabitants, are considered urban. A large proportion of India’s and

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 China’s rural population live in settlements which under such definitions would
be reclassified as urban. Since India and China have a high share of Asia’s
population this, in turn, would significantly change Asia’s level of urbanization -
and even change the world’s level of urbanization by a few percentage points
(Hardoy and Satterthwaite, 1989; UNCHS, 1996).

Infrastructures are more necessary for cities than rural areas because urban people rely
specially on these infrastructures for survival.

There are also other manifestations of urban centers. Cities exhibit man-made
environment unlike rural settlement which in most cases is surrounded by natural
environment.

 Greatest isolation from nature

Cities are dominated by man-made environment as reflections of urban settlement

or reflection of urbanization such as high rise buildings, machinery, road network,
power supply, telephone services etc.

 System of Interaction. in cities there are more numerous contacts, impersonal

relations, causal relationship, short lived relations, standardized and formal relations
as compared to rural relationships which is based on expanded family and kinship

 In cites there is more independence and self reliance.

The Case of Ethiopian towns and cities

 In Ethiopia, cities emerged spontaneously i.e. there has not been systematic urban
policy that should guide the pattern of urban development.

 In the face of such situations, urban centers were established for different reasons.
It includes administrative and political/military reasons. They were established by
ruling classes, nobility and gentry

Thus, some of the original cities were garrisons and headquarters of the ruling class.

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Therefore, they are mostly dictated by political and administrative decisions. Before
1887 (when AA was established) there were no permanent cities for the kings.
Therefore, they were roving here and there in search of such centers. The establishment
of Addis Ababa as a capital seems to be the first political and administrative decision to
have permanent capital. The urban centers which existed before and after 1887 were the
product of arbitrary decisions of central and regional governors. Example, Jimma was
established by Aba Jifar. The original part of the city, Jiren, was established for military
purpose.

Hawassa was developed as garrison town from where provisions and logistics were
supplied to the army.

 Urban development in other countries is based on a well thought policy and

strategy. There are different approaches in this regard.

1. Growth centre approach. It is a system where by few places are carefully

selected for their potential in developing the surrounding areas and beyond in
terms of triggering development (Agricultural or industrial). Urban centers
should be propellers of new ideas and innovation for other parts of a country.

2. agropolitan approach

Developing small urban centers with industries that are highly linked to the
surrounding agricultural and natural resources

3. Administrative suitability

Establishing centers which are accessible and efficient in their administrative

services.

But Ethiopia lacks these approaches:

 In Ethiopia urban centres and urbanization as a concept, space and management

object was given a very little attention. This can be justified by looking at some of
the official documents.

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In 1968 E.C. a report published by Central Statically Authority lists the following criteria
to identify urban from Rural in Ethiopia:

1. Buildings and houses must be established in continuous alignment

2. There must be at least one public bar in which beverages are sold

3. There must be one permanent shop which sells different goods

4. There must be at least one weekly market

5. There must be at least one hotel where strangers spend nights by paying bed
charges.

Unit Two: Urbanization- Meaning, Trends and Consequences

No universally accepted definition is available for urbanization like other concepts in

social sciences.

 Urbanization simply means the growing population living in cities or it is a place

of concentration of nation’s population in urban centers.

 Alternatively urbanization can be defined as a continuous process from being

rural to being urban. This is described in the engagement of population from
primary operation to secondary and tertiary operation reflecting the change in
product and specialization

 A more elaborated definition of urbanization refers to the “process which rises to

the concentration of the population economic activities such as manufacturing,
services, commerce, profession and informal sector”.

 Urbanization is the outcome of social, economic and political developments that

lead to urban concentration and growth of large cities, changes in land use and
transformation from rural to metropolitan pattern of organization and governance.

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 But these criteria may not be fulfilled in non-western urbanization.

In non-western countries, urbanization is the function of demographic changes but

in the west it is the function of industrialization

When and where did the first cities develop?

 There were at least seven regions of primary urban generation.

 These centers are called places of pre-industrial civilization.
 All of them are situated in the present-day Third World.

1. Mesopotamia
2. Egypt- the Nile Vally
3. Indus Vally
4. The North China Plain
5. Meso America- Mexico
6. Central Andes
7. Yoruba in southwest Nigeria

 The origin of urban center is not exactly well known. However, there are
literature myths and speculations in archaeology that indicate cities emerged
during recorded history.

 The first important step in urban development is the emergence of settled

agriculture (when people started to live in a group of community and begun to
cultivate land in commune).

 Gradually those communities were able to produce surplus products i.e. excess
surplus over and above house hold consumptions.

 These surplus products should have been sold in the market. This necessitated
middle men who communicate between the producers and the buyers. The
emergence of middle men created a group of people who are detached from
agriculture.

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  Moreover, some special working groups emerged who provide services to the
community. These include craftsmen, black smith, potters and others who
specialized in non agricultural occupations. Historically, cities emerge if and only
if there is a group of community who are engaged in the provision of services.

Thus, surplus product was an important condition for the emergence of cities.
Documents indicate that, at least by the mid 5500 B.C mixed farming
communities were living in villages in Southeast Asia. This was followed by the
development of technology like ox-drawn plough, the wheel cart, sailing boat and
the art of metallurgy.

 According to Carter (1977, 1983), there are four main explanations for the initial
emergence of town and cities:

. Hydraulic or ecological theses - cities occurred due to the presence of

favorable physical environment which allowed the extraction of agricultural
surplus.

 Economic theories – city as a product of the articulation of long distance

trade and regional market functions.

 Emergence for military purpose – towns grew for military purposes at

defensive strong points.

 Religious theories – urban development occurred about foci afforded by

shrines and temples.

Preconditions for urban Emergence

The causes for the emergence of cities were the function of many factors. These include:

1. The need for stationary mode of life

- transition from hunting to settled agriculture

- moving from animal like life to human life

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2. Increase in the number of settlers of population. The increase in population
raises the questions of permanent ownerships people started to create the
pattern of land ownership
3. Favorable ecological Environment
- Conducive climate, fertile soil and hydraulic resources
4. Technological development
 As technology advances, people are also able to produce goods in quantities and
qualities. As these goods are produced in abundance, they must be marketed to
other communities. The diversity of products sparks off new demands and create
group of middlemen who make their living outside agriculture. Thus, the
emergence of non-agricultural communities is and important step in the
development of cities
5. The emergence of special groups which led to social classification or social
classes, such as the rulers and the ruled, nobilities, princes leading o the creation
of head quarters for the rulers.

6. Administrative Reasons.

Settlements are also selected on the bases of administrative reasons to provide equal
administrative services at national, regional, zonal and woreda levels, e.g. the recent
example in Ethiopia is the establishment of Samara as a regional capital of Afar
Region.

Trend of Urbanization

LDC towns and cities are receiving 45 Million new urban residents/year

World Urban popn grew 16.8 % 1960-70, 16.9 1970-80. If this trend continues, the
whole world popn will be urbanized by 2031

Africa 360 Million urban popn in 2000 and it will be 913 Million in 2025.

1920 1970 2000 2025(% of total pop living in urban areas)

LDCs 10 25.5 39.5 56.9

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Africa 7 22.9 41.3 57.8

(R. Potter and S. Lloyd Evans: 1998)

Comparative view of the Urbanization trend of the LDS and DCs

In developed countries the following situations are either going on or are intended to
happen in the near future:

 a modest level of quantitative urban development: zero growth in the population

flow to big urban areas.
 an undergoing considerable qualitative development: an increase in the number
of square metres required by each temporary or permanent inhabitant or worker,
 obsolete infrastructure is undergoing renewal,
 a relative impoverishment of the centre.

What is happening in developing countries?

 a sharp drop in incomes in city centers resulting in inner city urban decay,
 a steep rise in city populations b/c of migration and natural population growth,
 there are 70 million new urban-dwellers each year,

major disparities from one country to the next,

Role of Cities
 Cities are formed because they provide cost advantages to producers and
consumers on the basis of agglomeration economies (urbanization + localization)
through backward linkage (factors availability) and forward linkage (sale
markets).
 Cities play the role of industrial districts, provide opportunities for joint ventures,
research, marketing, training and infrastructures. Traditional township
specializations have evolved into clusters with division of labour and selling
products throughout a country.

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  According to urban hierarchy model, plants in various industries have a
characteristic market radius that results from the interplay of three factors:
economies of the scale in production, transportation costs and the way the demand
for land is spread over space. Clearly this model applies to non-export industries.
According to differentiated plane model the limited number of transportation
routes linking the industries within an economy plays a key role. Primary
processing industries have few inputs and are usually located near the source of
agricultural inputs.

 Thus, under normal conditions cities and towns make vital contribution to
economic and technological development by providing public services and
infrastructures.

What are infrastructures? There are two types of infrastructure:

a) Physical Infrastructure: includes communication, transportation facilities like road,

telephone, power supplies, and potable water.

b) Social Infrastructure: includes health care, education, recreation, social and cultural
facilities.

 In many places, cities account for 2/3 of GNP and host large commercial and
industrial activities

 The modernization of agricultural sector largely depends on the emergences of

cities because they provide markets, financial processing and distribution
activities.

 These towns serve as market places for the rural community both to sale products
and purchase agricultural and non-agricultural inputs.

 Cities also provide economies of scale by bringing buyers and sellers in close
proximity. By doing so, cities reduce the cost of transportation and
communication. Moreover, cities make easy and less expensive the provision of

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 services such as power supply, road network, water supply, drainage and
sewerage facilities.

 According to economists like Lewis Arthur, higher productivity of city allows

higher wage which in turn leads to saving and investment capital
accumulationindustrializationhigh employment.
 As indicated earlier, it means that cities provide advantages because they provide
cost advantages to producers and consumers on the basis of agglomeration
economies (urbanization + localization) through backward linkage (factors
availability) and forward linkage (sale markets).

Transformation in Global Urbanization.

It is from Metropolis to Mega cities

World Cities or Global Cities - refers to those cities that dominate world affairs in terms
of production , market, large population, sophisticated finance and service complexes, a
high network of transport and communication hubs, .

NY, Brussels, Paris, London, Amsterdam and Milan= principal world cities
Singapore, Hong kong, Bangkok, Manila, Taipei, Shangai, Seoul, Osaka, Mexico City,
Rio de Janiero, Buenos Aires and Joburg = are joining the emerging network of World
Cities.

Chapter 3. CAUSES and consequences OF URBANIZATION

Causes:

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 1. Migration

2. Natural Growth

Migration

Some writers define migration as:

 Population mobility from one place to another or it is simply a change of
residence. It involves a complete change and adjustment to the new environment.
This definition assumes migration as a permanent change of residence.
Others define migration as:
 A casual, cyclical change of residence for temporary reasons. Such as seasonal
job search, job transfer and family movement cases. This definition assumes
migration as a short range change of residence. For our purpose, we use the fist
definition for it is relevant to rural urban migration as a complete change of
residence.
Migration can take in different forms:
1. Rural- Urbanl migration
2. Urban- urban migration
3. Rural-rural migration
4. Urban- rural migration,
The urban rural migration is the least practiced form of migration in Ethiopian context.

Why people migrate?

There are two general factors as the causes of migration.

1. Pull factors

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 Pull Factors include: employment opportunity in urban centers, better facilities such as
education, health care, recreational centers.

2. Push factors include natural and man-made phenomena that force people to be
displaced from their origin. (it includes drought, famine/starvation, population pressure,
political instability, natural calamity such as earth quake, floods, volcanic eruption and
others.

Population pressure includes extended family. Population pressure leads to land

shortage, land degradation which force people to migrate.

It is commonly understood that in Ethiopia the push factors are the main reasons for
migration from rural to urban.

 While international migration has attracted increasing attention in recent years

(often because of its political implications in destination countries), little is known
about internal migration despite the fact that its scale, direction and demographic
characteristics (such as sex and age composition) are fundamental to an
understanding of urbanization processes.
 Traditional approaches to migration have relied on the notion of "push-pull"
factors as the main explanatory elements. In the neo-classical perspective,
decisions to move are made at the individual level in response to hardships in
source areas (the "push" factors) and to perceived comparative advantages in
destination areas (the "pull" factors).
 Individuals rationally decide to migrate because they are attracted by the bright
lights of the city which promise, in the long-term, to offer better economic
opportunities than the countryside.
 The structuralist approach to migration, on the other hand, tends to portray
migrants as victims rather than rational decision makers, since movement is
determined by macro-social, historical and dialectic processes such as the socio-
spatial restructuring of production at the national and global levels. Push-pull
factors are seen here as a process of polarization with respect to access to

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 resources, and migration as one of few options available to the most vulnerable
population strata.

2.2 Consequences of Rural-Urban Migration and natural Growth

 Rural-urban migration was once viewed favourable in the literature of economic
development. Internal migration was thought to be natural process in which
surplus labour was gradually withdrawn from the rural sector to provide needed
manpower for urban industrial growth.
 The process was deemed socially beneficial because human resources were being
shifted from lower to higher marginal product (Lewis theory of development).
In contrast to this view it is now clear that rates of rural-urban migration continue to
exceed rates of urban job creation and to surpass the absorption capacity of urban
industry and services.
 Migration exacerbates rural-urban structural imbalance in two direct ways. First,
on the supply side, internal migration disproportionately increases the growth rate
of urban job seekers relative to urban population growth.
 Second, on the demand side, urban job creation is generally more difficult and
costly to accomplish than rural job creation. Migration in excess of job
opportunities is both a symptom of and a contributor to underdevelopment.

 Thus, the process of urbanization presents enormous challenges to governments,

social and environmental planners, architects, engineers and the inhabitants of the
world’s cities. Natural population growth and migration has brought severe
consequences which include increased poverty, in adequate housing, inadequate
access to basic services, proliferation of squatter settlements, urban environment
degradation and increase in the informal sector.

We can generally classify these consequences into four categories:

1. Squatter Settlements:

2. Poverty

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 3. Informal sector
4. Environment Degradation

We can generally classify these consequences into four categories:

5. Squatter Settlements:

6. Poverty

7. Informal sector

8. Environment Degradation

1. Squatter Settlements

Squatter settlements tend to be unplanned and are often illegal. Houses are self-built
using basic materials. Squatter settlements have few services.

Thus, Squatter Settlement is illegal occupation of public land.

There are at least 3 characteristics of squatter settlements
I. physical characteristics
II. social characteristics
III. legal characteristics

i. The physical Characteristics:- Squatter settlements have infrastructure and

service below minimum level. May not be connected to water supply,
electricity, road, and drainage and sewerage facilities.

Insecured because of lack of security services like police service, fire protection service.
The squatter settlements are also built in marginal lands at peripheries, river sides and
dumpsites.

ii. The Social Characteristics:-

Squatter settlements belong to low income groups or informal workers. On average most
residents earn a very low income and many of them are part-time workers/daily laborers.

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Most squatters are predominantly migrants from rural to urban or from small urban to
large urban centres. They may be also second or third generations of squatters.

iii. Legal Characteristics:-

Squatter settlements are inherently illegal because the squatters occupy public land with
out any legal permission.

They do not have authorized permits, ownership certificate, not backed by legal
provisions. They are against the master plans of a city which shows residential,
commercial, industrial and other plots (zones).

Squatter Settlements, Slums and sprawls: What is the difference?

 Slums are decayed, shanty, and rotten areas of a city. The difference between
slums and squatters is that slums are legal but squatters are illegal. But they
both share physical characteristics.

 Slum housing is basically associated with bad housing: For instance slum
housings are dwellings that have inadequate light, air, toilet and facilities are in
bad repair and improperly heated. Moreover, slum houses do not afford an
opportunity for family privacy. It is subject to hazard, overcrowded and no space
for recreation.
 Slums are highly congested urban areas marked by deteriorated, unsanitary
buildings, poverty, and social disorganization.

On the other hand, squatters settle on land, especially public or unoccupied land,
without a right or title. Squatters include those who settle on public land under
regulation by the government, in order to get title to it.

 Simply, slums refer to the environmental aspects of the area where a community
resides, while squatters refer to the legality of the land ownership and other
infrastructure provision.

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The residents of slums face many problems on a daily basis.

 Overcrowding-high population density

 Fire hazards: fire can soread quickly

 Overpopulation: the area does not have enough resource to support the growing
population, lack of space

 Disease: poor sanitaion and limited healthcare can lead to spread of disease

 Services such as buses are overcrowded.

In Addis Ababa most kebele houses are examples of slums.

Sprawls

Causes of Urban Sprawl

The process of urbanisation is fairly contributed by population growth, migration and

infrastructure initiatives resulting in the growth of villages into towns, towns into cities
and cities into mega cities.

In this case for ecologically feasible development, planning requires an understanding of

the growth dynamics. Nevertheless, in most cases there are lots of inadequacies to
ascertain the nature of uncontrolled progression of urban sprawls.

Sprawl is considered to be an unplanned outgrowth of urban centres along the periphery

of the cities, along highways, along the road connecting a city, etc. Due to lack of prior
planning these outgrowths are devoid of basic amenities like water, electricity, sanitation,
etc.

The fact that cities in LEDCs are growing rapidly means that conditions in towns and
cities are poor. There are often great inequalities within urban areas. The gap between
rich and poor is even greater.

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 2. 2. Urban Poverty

 In World Bank’s report of 1988, 550 million poor people were living in cities.

 Now (2000) the number is increased to 700 million, 50% of which are
chronically poor.

 Urban poverty is a multi dimensional phenomenon. It is a deprivation of access

to basic necessities that sustain life. These include limit of access to employment
opportunities and income, inadequate and insecure housing and service, violent
and unhealthy environment, little or no social protection mechanisms, limited
access to health and educational opportunities.

Urban poverty is often characterized by cumulative deprivatation i.e. one dimension of

poverty is often the cause of another dimension. Urban poverty is characterized by
significant and multiple deficiencies whose main dimensions include:

 Insufficient or unstable income, which leads to inadequate consumption;

 Risks caused by deficient access to basic goods and services;
 Low-quality housing that leaves residents more vulnerable to critical sanitary
problems, contamination, crime and natural disasters

Features of Urban poverty

 It is also useful to analyze urban poverty with reference to vulnerability i.e.

susceptibility to risk; and venerability is closely link to asset ownership. The
more assets people have the less vulnerable they are. The greater erosion of
people’s asset, the greater their insecurity. These assets include:

- Financial Capital

- Human Capital

- Social Capital

- Physical Capital

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 - Political Capital

- Natural Capital

Poverty means lack of the above essentials

Dimensions of Cause or contributing factors

Poverty

Income employment insecurity/casual work, unskilled wage labor, inability

to hold job due to bad health, lack of qualification

Health Unhygienic environment, congestion and traffic pollution,

settlement on marginal lands which are prone to hazards such as
floods , landslide, exposure to disease due to poor air,

water and lack of sanitation, injury and health rising from traffic,
industrial accidents especially for those in the informal sectors .

Education Constrained access to education due to insufficient school size,

inability to afford school fees

Security Tenure insecurity, lack of access to houses, personal insecurity, due

to drug/alcohol abuse, family break down, reduced support for
children, income inequality in cities which increase tensions.

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Causes of urban poverty

 Warfare, drought, natural disaster, social inequality, corruption, high population

growth.
 Large families.
 Improper training
 Slow job growth
 Poor work culture

Who should involve in the fight against poverty?

Government, NGOs, private sector, the public individually and jointly via CBOs must be the
main actors in fighting poverty.

Usually, the government comes first for the following reasons:

1. it has better institutions to mobilize the public

2. it has better infrastructure

3. it can design good policy instruments

 After government, follows the public and the private sector and NGOs in the ir
order of importance. NGOs come at last because NGOs are temporary actors.

 Though private organizations have major aim of profit maximization, they play
crucial role by creating employment and contributing to national development
through taxation and other contributions.

The assumption is that NGOs will cease to exist because assistance can not be life time
undertaking. This is for development NGOs which are engaged in the direct or indirect
production of goods and services.

There are also other generation of NGOs with the aim of crating awareness to the public
about advocacy and human rights rather than relief and food provision.

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Poverty is not only lack of money or facilities, it is also the result of poverty of spirit i.e.
attitude of hopelessness, ignorance of available resources and dependence on others, lack
of confidence, lack of skills, lack of integrity, lack of trust.

Hence, it is a combination of multidimensional factors such as Disease,

Ignorance, Apathy , Dishonesty and Dependency

Disease. If there is disease, there will be high absenteeism and subsequent declining of
production and wealth.

Ignorance Lack of information and knowledge and it is different from stupidity which
is lack of intelligence, different form foolishness which is lack of wisdom

“Knowledge” is power is an old English saying which describes the importance of

knowledge.

NB: Information is a raw data, unless we interpret it in to practice or meaningful analysis,

it is useless.

The following saying shows a comparison between information and knowledge, “we are
drowned in a pool of information but we are starved of knowledge”

Apathylack of interest (people do not care when they feel powerless). When they do
not try to change things. It goes with a mentality of accepting existing problems and live
with it because they believe that God has decided their fate.

Russians say “Pray to God but sail to the shore “

Dishonesty  when there is no respect for humanity and its resources. It takes place
especially when resources are abused; facilities are diverted for individual purposes.

 Dishonesty leads to morale decline

 Dishonesty leads to temptation of abusing resources

24
Dependency  If a person is devoid of health, self control, he will be dependent mainly
on aid.

2. 3. Informal Sector

 Large cites attract migrants despite all their problems. People migrate to cites
either in search of jobs or to escape the agony of rural poverty.

 But the cites do not have available jobs in the formal sector . When the migrants
fail to be employed in the formal sector, they shift to the informal sector.

WHAT IS THE INFORMAL SECTOR?

The existence of an unorganized, unregulated and mostly legal but unregistered

informal sector in developing countries was recognized in the early 1970s.

 But there is no universally accepted definition of Informal Sector so far despite

that studies reveal the share of the urban labour force engaged in informal
activities is growing and ranges from 30 to 70%, the average being 50% in
developing countries.

 Despite large number of research as a concept it remains illusive. The reasons

are that the sector is heterogeneous in terms of activities and scales. Some times it
includes workers operating in their own business, employees in small business,
wage laborers and apprentices.

 In other cases it includes small activities like shoeshine, petty trading and
socially useless jobs (begging, prostitutions), service people (gardeners, house
cleaners, servants in house, street scavengers).

Lubanga (1992) defines informal sector as follows:

 “Informal sector consists of small scale self employment activities with or without
hired workers typically operating with a low-level of the organized form and

25
 technology to generate income for the participants. These activities are carried
out with out formal approval from authorities”
 The existence of an unorganized, unregulated and t unregistered informal sector in
developing countries was recognized in the early 1970s.
 The bulk of new entrants to the urban labour force seemed to create their own
employment or to work for small-scale family-owned enterprises.
 The self-employed were engaged in hawking, street vending, letter writing, knife
sharpening, junk collecting, selling fireworks, prostitution, drug peddling, etc.
Other found jobs as mechanics, carpenters, small artisans, barbers and personal
servants.
 Studies reveal that the share of the urban labour force engaged in informal
activities is growing and ranges from 30 to 80%, the average being 55%:
 The self-employed workers in informal sector have little formal education, are
generally unskilled, and lack access to financial capital.
 Therefore, workers productivity and income in this sector tend to be lower than in
the formal sector. generating activities including women and children and they
often work very long hours. They usually live in slums, which generally lack
public services like electricity, water, drainage, transportation, educational and
health services.

Major Features of the Informal Sector:

1. Small scale operation

2. Self or family employed

3. Not licensed

4. easy entry and exit

5. reliance on indigenous resource

6. Labor intensive

26
 7. Skill acquired outside formal school

In the Ethiopian context the informal sector is viewed as sectors:

- Not registered as companies or cooperatives

- They have less than 10 personnel employees

- They have no written book of accounts

- They have no license and hence do not pay tax

Causes/Reasons for the Emergence of Informal Sector

1. economic crisis

2. failure of formal sector to absorb labor

3. low skill and education

4. Lack of capital

5. failure of agricultural sector to create employment

The informal sector: legalization or laissez-faire?
 It is an undisputed fact that the informal sector is a growing and increasingly
complex phenomenon in the economic, social and political life of many
developing countries.
 In Latin America, this sector accounted for 80 per cent of the 10.1 million jobs
created between 1990 and 1993; (1) in Africa, two out of three city-dwellers
already earn their living in this "survival sector", which is expected to generate 93
per cent of additional urban jobs in the 1990s.(2) The promotion of this sector is
one of the main issues in development policy today.
 With the adoption of structural adjustment policies and the revival of neo-liberal
doctrines in the 1980s, two opposite and controversial positions emerged with
respect to this sector.

27
  On the one hand, there were the advocates of stricter control over the conditions
for engaging in informal activities in order to guarantee a return on investment in
modern enterprises, given the threat of unfair competition from the informal
sector (this view was very widespread in Africa, as a result of the decline of the
regulatory role of the State).
 On the other hand, there were those who believed that the legislative and
administrative system must be thoroughly reformed in order to free the initiative
and economic potential of microenterprises (the approach adopted by the neo-
liberal reform movement in Latin America).
 Both of these perspectives are reflected in the ILO's Employment Policy
(Supplementary Provisions) Recommendation, 1984 (No. 169), which calls for
recognition of the importance of the informal sector as a source of jobs (27 (1)).
 The legal status of informal establishments, their relationship to the State and the
role of public institutions are therefore of major importance.

2.4. Environmental Problems/degradation/crisis

The most serious problem of environmental degradation is its implication on health,

urban sanitation and beauty.

Health concerns include air and water pollution, water supply and sanitation. Waste
disposal; chemical and food safety and other waste related problems: Generally
environmental problems are classified into two: indoor and out door problems.

I . Indoor problems (Domestic Problems) these have many dimensions such as:

1) Waste water (liquid waste) and Sewage

Many even large cities of 3rd world nations have no sewerage systems and
adequate waste water treatment facilities.

This had consequent health problems on the poor with water born problems.

28
2) Inadequate drainage facilities: in many cities of 3 rd world cities poor drainage system
led to regular flooding

3) Indoor Air pollution:- rises from smoke, dust and other sources which lead to chromic
lung problems and Asmathic Diseases

4) Noise: in some cites the use of high-fi equipment and other instruments of
entertainment damage the hearing of those constantly exposed to that noise. Noise
becomes a constant source of disturbance and leads to poor attention and poor health

II. Out door (Non-Domestic) Problems.

This includes:

1. Hazardous industrial solid waste. countries in the 3rd world are finding
it difficult to control industrial wastes and release them to the nearby
surrounding without recycling their toxic content

2. Hazardous Hospital wastes: in many cities clinical wastes from hospitals

and other medical facilities are in adequately treated and often find their way
to residential environments such as open dumps, where waste pickers are
exposed to serious health problems.

3. Industrial Air Pollution: Lack of adequate control of smoke and dust

from industry results in air pollution .

Industries release acid to the environment and to the air that affects human
health. These acids also come down in the form of rain with subsequent
environmental implication.

Major outdoor problems

1. Industrial liquid and solid wastes

2. Hazardous hospital wastes

3. Noise from Industries

29
4. Industrial accidents
5. industrial air pollution
6. traffic Congestion and poor traffic management

30
 Changing views in Urban Governance
If there is any change at national level there will usually be simultaneous change at local
level. These days change in government calls for good governance, demanding for more
accountability, fairness and responsiveness.
* Sustainable development is that which meets the needs of the present without
compromising the ability of the future generation to meet their own needs. This means
sustainable development programs aim at achieving:
1. social progress
2. effective protection of environment
3. prudent use of natural resources
4. Maintenance of high, stable and series economic growth. The ultimate goal of
good governance is to bring sustainable development.

 Accountability in Urban Government

 The urban governments under many circumstances are accountable to the
electorate.
 Urban government is complex set of institutions and groups with various lines of
accountability.
 Some are directly accountable to the electorate or to the national government,
whereas others are accountable to state government or can be controlled by a unit
which is at a remote distance. In theory the extent to which urban governments
are accountable to the public has a major impact on the effectiveness of the
municipal government.
Under this circumstance any local government is expected to fulfill the following factors.
1. it must be responsive to the needs and circumstances of the residents
2. it must be efficient and honest in the use of public resources
3. it must be fair and economic in providing public services.
Accordingly, the representative nature of urban government assumes that local
government is effectively controlled by local electoral choices or through ballots.
However, there are a number of factors that affect the realization of these assumptions.
These include

31
(1) National political climate
(2) Civil liberty
(3) The level of pubic awareness and educational level. These are external factors.
On the other hand, internal factors which affect the representative nature of urban
government are:
(1) the constitution of local government
(2) the extent of voters choice
(3) the regularity of election
(4) the electoral system

External Factors
National political climate refers to whether there is a tendency to centralization or
decentralization.

Civil liberty: Individuals right whether they have the right to association, freedom of
speech etc.
The nature of internal factors affecting the choices and preferences of the local

government.

(1) The constitution of local government

 The mode of local accountability rests on the ideas and issues contained in the
constitutions of local government.
 Though almost all local constitutions give ultimate powers to the residents, and
there are many instances when the central or the state governments intervene in
the affairs of municipal governments.
 The central/state governments have the right to appoint and remove councilors
and mayors.
 This has happened in Malaysia and Indonesia in the 1970s. For instance, in
Indonesia ¼ of the municipal council/government must constitute national army.
The implied reason is to manipulate the council and the urban government. That is
one-fourth of municipal space goes to the army.

2. The Extent of Voters Choice

32
  Elections are the only meaningful instruments of accountability if and only if
voters have genuine choice.
 Elections must be free and fair. There must be fair representation of minorities
and local voices.
 However, against this background, some of the time elections are manipulated;
vote rigging and intimidation take place. If these things happen, elections couldn’t
be fair, and there cannot be fair representation as well.

3. Regularity of Elections
 Many constitutions define that elections take place regularly. However, regular
elections are undermined, when higher level governments suspend elections, and
even dissolve councils.
 This happened in Tanzania, in Chile, Malaysia in diffident times.
 The legitimate reason of delaying elections is usually only when the government
is in state of emergency.
 Many cities are a center of elites, economic establishments etc. hence, many
governments do not want to let urban centers free.

4. Electoral System
There are two broad systems that are practiced in many places. These include
(a) Geographic/spatial systems
(b) Party systems
 In Anglophone countries such as India, Nigeria, Zimbabwe and Pakistan election
is carried out on geographic basis.
 The municipal government is divided along zonal territories known as wards.
Each ward elects its representatives according to the number of population in the
locality.
 In other countries party system is used to secure seats in the local council in
proportion to the parties share. Individuals take these seats according to their
numerical positions on the pasty list.
 Under moral conditions each party contested in the election will have a
proportional representation in the local council. However, this representation is
possible if and only if elections are free and air.

33
How to elect a mayor
There are 3 ways of electing a mayor

1. Appointment by central/ state governments. This can take place either through direct
appointment from above or the local council may present a list of nominees to the higher
government and the higher government chooses from the list.
Eg. China and former Soviet Union
2. Election by council
Urban council elects a mayor among it ranks. The election takes place in consensus or
through majority vote.
3. City-wide electionwhen the mayor is elected independently of the council’s
election. A separate mayoral election takes place.

Towards a Set of Urban Governance Indicators

Decentralization - Financial:

 Autonomy of financial resources

 Can local government decide on the use of local resources?
 Predictability of inter-governmental transfer
 Principles of financial devolution
 Level of adoption of the budget
 Sources of local government funding ((taxes,user charges, borrowing, central
government, international aid)
 Can local government raise resources from capital markets without approval of
from higher levels of government?
 Percent of funds devolved from higher levels of government

Decentralization - Political:
 Dismissal of mayors, councilors and officials
 Progress of deciding political agenda
 Legislation on de-centralisation (yes/no)
 Number of gender equity oriented initiatives undertaken by local organisation or
institutions
 Percentage of elected and nominated members by sex/ethnic group
 Control by higher level of government
 Access to government positions by all groups

Local government:

34
  Process of selecting mayor
 Regulatory framework that governs promotion of civil servants
 Career prospects of civil servants
 Pay scale of civil servants
 Tacit knowledge about the power structure

Planning and predictability:

 Openness of procedures for contracts/tenders for municipal services
 Appointments by higher government
 Annual budgeting
 Percent recurrent resources for Pvt Sector/CBO
 who supplies and regulates various services
 independent decisions, regulation/taxes, auditing, removal from office
 Sources of income
 Transparency of local taxation
 Consistency/regularity of local mayor election

Responsiveness:
 Percentage of population served
 Access of public to stages of policy cycle ( planning, budgeting, monitoring, etc)
delegation of public service
 Integration of planning and budgeting
 No of public hearings and participants from different income/ethnic groups
 Are data collected and used by gender and district
 Existence of conflict mediation at local level (budgeted)

Empowerment:
 Existing participatory processes
 Group equity in participatory planning and decision making
 Equal access to education and information
 Existence or not of information on differential situation and needs of women and
men
 Legal entitlement to different assets to all categories of people
 Self determination of groups in relation to resource management
 Civil freedoms - press, association, justice
 Social group and watch dog for programme implementation
 Number of CBO’s and specific organisations addressing gender issues
 Access to basic needs

Effectiveness:
 Consumer satisfaction ( survey/complaints)
 Capacity for delivery of services ( including spatial coverage)
 Income/expenditure of local govt/capita
 Legislated local government functions
 Targets, programme, financial
 Economic development ( city Product)

35
  Environmental quality

Freedom, justice, fairness and equity (concentrated on equity first):

 Equity in tax system
 Incorporation of excluded groups in the consultation process
 Resource allocation to services benefiting the poor/ the rich
 Access to basic services for disadvantaged groups Eg spatial distribution of
services
 Quintile distribution of city product
 Ratio of price of water in formal informal settlements
 Existence of public hearings
 Existence of local media
 Resource allocation towards formal/informal settlement
 Rental; to income ratio in formal and informal settlement

Accountability and transparency:

 Fairness in enforcing laws
 Clarity of procedures and regulations and responsibilities
 Existence of sanction, performance standards and disclosure laws
 Codes of conduct for professional associations

Forward Looking:
 Social development plan
 Vision/mission statements
 Forward/strategic Plans
 Communication strategy
 Gender perspective
 Revenue growth ( total and own)
 Funds known in advance
 Setting budgets/targets
 Existence of planning department

Participation:
 Role of key groups in planning , decision making, implementation, monitoring
and evaluation
 Freedom of media and existence of local media
 Percentage of people voting by sex and social groups
 Process of public discussion on key issues
 Use of referendum on key issues
 Right of establishing association

Private sector:
 Extent of civil society organization ( monitoring )
 Predictability of enforcement
 Integrity of auditing and monitoring
 Existence of enabling city legislative environment

36
  Predictability of institutional change
 Credibility of rules
 Existence of an official admin structure

Security:
 Percentage of unsafe city areas-crime rates (murder, rape)
 Police corruption- feeling of safety
 Efficiency
 Per capita revenue
 Cost of various services
 Percentage economic Growth
 Recycling/re-treatment/sustainability
 Percentage on salaries
 Employees per delivery service
 General administration share
 Number of local government employees/ 1000 population

Civil society:
 Resource requirements to organised groups
 Status of local leadership ( formal, informal, legitimate, non legitimate, respected,
non respected, independent
 Existence of emergency laws against public meetings, tradition of public action
 No of NGO’s
 No of procedures need e to register NGO’s

Planning and management:

 Functional responsibilities for service provision (sewerage, water, education,
health, social services, green space etc)
 Possibility that the mayor is good!!!!

Top 12 Urban Governance issues/indicators:

1. Consumer satisfaction (survey/complaints)

2. Openness of procedures for contracts/tenders for municipal services
3. Equity in tax system
4. Sources of local government funding ((taxes,user charges, borrowing, central
government, international aid)
5. Percentage of population served by services
6. Access of public to stages of policy cycle
7. Fairness in enforcing laws
8. Incorporation of excluded groups in the consultation process
9. Clarity of procedures and regulations and responsibilities
10. Existing participatory processes
11. Freedom of media and existence of local media
12. Autonomy of financial resources

37
 Transparency Reform Scorecard
Data suggest that transparency helps improve governance and reduce corruption —
essential ingredients for better development and faster economic growth. But there is a
need to pay more attention to the issue. For that reason, the World Bank Institute has
begun to construct an index to help make transparency more transparent. Further, in
terms of reforms, a basic checklist, which countries may use for self-assessment,
includes:

 public disclosure of assets and incomes of candidates running for public office,
public officials, politicians, legislators, judges, and their dependents;
 public disclosure of political campaign contributions by individuals and firms,
and of campaign expenditures;
 public disclosure of all parliamentary votes, draft legislation, and parliamentary
debates;
 effective implementation of conflict of interest laws, separating business, politics,
legislation, and public service, and adoption of a law governing lobbying;
 publicly blacklisting firms that have been shown to bribe in public procurement
(as done by the World Bank); and "publish-what-you-pay" by multinationals
working in extractive industries;
 effective implementation of freedom of information laws, with easy access for all
to government information;
 freedom of the media (including the Internet);
 fiscal and public financial transparency of central and local budgets, adoption of
the IMF’s Reports on Standards and Codes framework for fiscal transparency,
detailed government reporting of payments from multinationals in extractive
industries, and open meetings involving the country’s citizens;
 disclosure of actual ownership structure and financial status of domestic banks;
 transparent (web-based) competitive procurement;
 country governance and anticorruption diagnostics and public expenditure
tracking surveys (such as those supported by the World Bank); and
 transparency programs at the city (and subnational) levels, including budgetary
disclosure and open meetings. Source: Finance & Development, September 2005,
P. 43

38
 URBAN FUNCTION/FINANCE
 Urban government is nexus of agencies which provide, finance, plans and execute
a range of urban services and functions.
 Some functions are performed by central government, others are performed by
state governments and others are still performed by municipal government.
Central and state governments accomplish urban functions through their public
agencies, enterprise and corporations.

Urban functions are generally classified into 3 groups.

39
1. The provision of public services.
2. Regulation of public behavior and
3. Coordination and planning of economic development.

1. Provision of public services.

Urban services include the following:
1. Construction of roads (feeder roads, or access roads)
- street lighting
- drainage facilities
2. Provision of clean water at individual or community level.
3. Disposal of liquid waste, solid waste and human waste
4. Provision of educational services at nursery, primary, secondary, and tertiary
levels.
5. Provision of health care services including hospitals, clinics and health centers;
and provision of hygiene services to the community.
6. Provision of housing services, rental and accommodation services.
7. Recreational services such as parks, museums, galleries, sporting services
8. Fire protection services.
9. Public transport services including train and public buses.
10. Social welfare services, protection of the elderlies, children, the handicapped and
generally the disadvantaged part of the community.

2. Regulation of Public Behavior

 Urban centers are responsible to ensure law and order in their jurisdiction. To this
effect they establish laws and law-enforcing institutions e.g. police, court, codes
and ordinances such as building codes, traffic codes, road patterns are all
mechanisms to enforce laws to ensure peace and stability.
Some of the details of these services include:
a. Housing and land control, including the application of rules on land use,
occupation, densities, architectural and building standards.

40
 b. Licensing of commercial and industrial activities, pollution control, including
regulation of car movements, industrial emissions/ effluents and restriction on
noise.
c. Environmental protection and health including prevention of communicable
disease, inspection of restaurants and hotels, control of pests and pesticides,
public hygiene.
d. Traffic management including parking sites, routing, and restrictions on vehicular
movements.
e. Vehicle licensing and safety inspection
f. Consumer protection including the enforcement of accurate weight, measures,
description of goods and services, their qualities and prices.
3. Coordination and Planning
 Includes expansion and allocation of investment for capital projects that
will ensure sustainable urban development. Employment creation and
infrastructure development.
 To this effect, urban centers must establish a range of economic
enterprises either jointly or through join ventures or on their own
 These enterprises must fulfill among other things the creation of values
and promotion of efficiency in resource utilization and in the realization of
sustainable economic and social development.
 This includes investment in strategic infrastructure such as roads,
telecommunications, commercial centres, industries and crevices.
 It also includes technical supports for enterprises that need credit facilities,
training, business advice, accounting and finance.
 It also includes incentives to investors such as tax concessions,
preferential access to public utilities and promotional services.

How can urban centers realize these services?

They need a significant amount of finance.
Urban Finance

41
  Urban finance is concerned with the identification of revenue, its mobilization,
allocation and utilization. The utilization includes disbursements, accounting and
auditing.
Sources of Revenues
 There are two broad sources of revenues for urban governments.
 These include locally raised revenues and externally obtained sources. Local
revenues include taxes, user charges, fees, and penalties.
Taxes are again of two types; direct taxes and indirect taxes.

Direct taxes
 are taxes which are directly imposed on individual income and include payroll
taxes on monthly and annual basis. Taxes on professional services, vocational
and occupational services are also direct taxes.
Generally direct taxes are collected from commercial activities, personal income tax, land
use tax, property tax and some times taxes on natural resources which are called royalties
(like taxes on mining).
]

Indirect taxes:
These are imposed not on a seller or producer but on the consumer. These are sales taxes
and excise taxes.
Sales taxes
A tax imposed by the government at the point of sale on retail goods and services. It is
collected by the retailer and passed on to the state.
Tax based on a percentage of the selling price of goods and services. State and local
governments assess sales tax and decide what percentage to charge. The buyer pays the
sales tax to the retailer, who passes it on to the sales tax collection agency of the
government.
Excise taxes
Taxes on the manufacture, sale, or consumption of goods, or upon licenses to pursue
certain occupations, or upon corporate privileges. .
External source: include loans, grants and shared revenues.

42
Regarding loan, municipalities can borrow money from a bank as any individual
enterprise; however municipalities must fulfill requirements such as legal personality and
credit worthiness to get the loan.

Grant is all transfer of financial resources from higher level to lower level of
government. Grants can be provided as lump sum (block grant) or can be attached to
special projects.
When grants are in lump sums they are not attached to any projects and it is called
general grant (block grant).
When grants are attached to specific projects they are called special grants. Special grants
are accompanied by specific restrictions/conditions.
E.g. capacity of urban centre to utilize the prospects of the urban center to grow

The Problems of Urban Finance

1. Growing population
A growing number of population in almost all urban centers imposes high pressure on
urban services and infrastructure. Unfortunately the majority of urban population is
unproductive and dependent, most of whom are migrants, jobless or involve in
socially useless jobs.
2. The nature of the intergovernmental relations.
In a highly centralized political condition, the relation between the higher level of
government and municipality is a kind of boss subordinate relation instead of
partnership. Rules are highly centralized and they do not take into account local
realities, as a result municipalities highly depend on the consent of higher
government. This has an important implication on tax rate, charge rate; budgeting and
control.
3. Institutional inefficiency
Lack of institutional capacity to raise revenues, to prepare budgets and execute them.
(Lack of technical knowledge, lack of manpower).
4. Subjective tax assessment

43
In the absence of accurate books of account, tax collectors are forced to impose tax
rates and amounts on business establishments subjectively. The reasons of not
maintaining books of accounts are:
 there are some businesses which are exempted from maintaining books of
accounts
 Those who are legally required to maintain books of accounts deliberately
avoid maintaining books of accounts. Even if they do, they prepare two
accounts, one is distorted and the other is accurate. They show the former
to tax authorities.
5. Legal backing
Lack of legal backing for municipalities when there is tax litigations. Municipalities
do not have internal legal mechanisms to handle tax related disputes.
6. Lack of loan
Lack of loan provision: this is due to lack of legal personality because many cities are
under the tutor of higher level government. Municipalities may not also be credit
worthy.
7. Lack of grants
Grant is not mandatory for higher level governments to give to urban centers. But
their provision is important to supplement the financial capacity of cities.
8. Weak financial planning
Weak budgeting is reflected in the discrepancy between budgeting revenue and
expenditure. The gap between financial planning and actual performance must be
narrow. Planning must be proactive; make things happen than let things happen

CHAPTER 5
Urbanization and Urban Management in Ethiopia
 Historical evidences show that the origin of urban centers traces back to the time
of Axunite Kingdom (about 1000 BC).

44
  Following Axum: Gondar, Lalibela and a number of other towns emerged.
 However, this was marked by discontinuity because of the absence of fixed urban
centers resulting from the political nomadism that prevailed until Addis Ababa
was built as the permanent seat of King Minlik II at the end of 19th century
(Akalu, 1966 and Horvath 1969).

 A combination of factors including physical, socio economic and political

situations have hampered the emergence, growth and development of urban
centers in Ethiopia until the last quarter of the 19th century.
 Rugged topography hampered easy communication and led to regional isolation,
under-development of occupations such as craftsmanship which could have
triggered large-scale industrial development and specializations.
 Moreover, internal conflicts and external aggressions had all contributed to the
slow emergence and development of urban centers in Ethiopia.
 Hence, Ethiopia entered the 20th century with a poorly developed urban system.
At the end of the 19th century only three urban centers, namely, Addis Ababa,
Harar and Mekele had a population of more than 10,000 inhabitants (see table
below)
Table 1: Population estimates of selected urban centers (1850-1899)

Urban Center Population

Assab 5,000
Debremarkos 2,000
Gondar 6,000
Debretabor 5,000
Harar 35,000
Debre Birhan 2,500
Ankober 6,000
Addis Ababa 30,000
Axum 3,000
Adwa 8,000

45
 Mekele 15,000
Source: (CSA,1984)

Despite the smallness and poor development of urban centers, some factors had
contributed to the emergence and expansion of many more towns in the country in the
same century. These include:
I. The establishment of central government that insured national unity and political
stability.
II. The introduction of modernity such as transport and communication networks,
schools, hospitals, roads and modern business. The emergence and development of
towns such as Dire Dawa, Nazareth and Mieso were the immediate result of Addis
Ababa- Djibouti railway line.
III. Ethiopia's exposure to the outside world which for centuries closed to its own
traditional system. Urbanization was further accelerated during the Italian occupation
of 1936 - 1941. The Italians built new urban centers. They also built road networks
that stimulated the emergence of new towns and the expansion of old ones.
 After the 19th century, urbanization had been the product of three historical events.
(1) Expansion of menelik II to the south
(2) Italian occupation, which took place between 1936-1941.
(3) Establishment of Ethio-Djibouti rail way.

1. Menelik’s Expansion
 With the expansion of menelik’s army to the south, a number of stations were
established which were gradually changed into urban centers.
 These stations essentially served as military centers, known as garrisons to control
the surrounding indigenous people during those attempts of territorial expansion.
 For instance, towns like Awassa and many other centers in the south were
garrisons. This period is marked with the establishment of Addis Ababa in
1887.The idea and practice of central government started during this period.

2. Italian Occupation

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 Italians further accelerated the rate of urbanization and at the same time
established new centers.
 Towns which were directly associated with Italian expansion were kombolcha,
Sndafa ,Jimma, Bonga, Azezo.
 concerning Jimma townItalian occupation accelerated the urbanization of Jimma
as it was the seat of Aba Jifar. Italians designed the master plan for Jiren in 1935.
 Before the Italian occupation, Jimma was confined to Jiren. After the occupation
they created two quarters namely Hermata and Mendera.
1. The Opening of Ethio-dipouti railway 1887-1917
 Following the opening of the Ethio-Djibouti railway, a number of nodal
settlements were established along the line between A.A and Djibouti.
 These settlements served as commercial centres and as transits to other parts of
the country.
 These towns include Debrezeit, Mojo, Adama, Metahara, Awash, Miesso,
Dengego, Diredawa. Mojo and Adama serve as transits to the south and south
east of the country.
 Now Diredawa and Adama are the two largest urban centres in Ethiopia.
Diredawa is the 2nd largest and Adama is the 3rd largest.
 There after the rate of urbanization and the number of urban centers has kept on
increasing.

Year % No of Urban Centers

1938 5.4 63
1950 6.1 108
1967 7.6 158
1975 11.8 183
1984 10.3 297
1994 15.3 540

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Source: CSA 1994.
Now it is estimated that the rate is 17% and the number of urban centers are 927.
The reason for the increase in the rate of urbanization is migration. In some urban
centers the proportion of migrant population is 50% and in other areas it is less.
Addis Ababa 49%
Dire Dawa 47%
Dessie 45%
Gondar 46%
D. zeit 44.8
D. Berhan 42
Source: CSA 1994.

 The national urban population growth rate is estimated at 5.5 % with substantial
difference-across urban centers.
 As a result there are large number of population based relatively in few urban
centers. Addis Ababa is said to be a primate city, this means that it is
characterized by primacy.
 The share of Addis Ababa in the national urban population is 30%.
 The reason for uneven concentration of urban centers is that there is no planned
intervention. In urban administration there is optimum level, where the urban
center stop growing in population.
 After reaching the optimum level the population and investment is directed to
other urban centers.
 Otherwise, it will lead to mismatch between the economy and population. It also
results in social evils such as crime, decline in urban services, increasing pollution
and congestion.
The solution is to establish satellite cities to attract population to these cities. Some adopt
tax incentives and investment incentive others used forceful direction of population to
solve the problem.

The Current Urban Setting

 Ethiopia, with a total population of 77 million, is the second largest populous
country in sub-Saharan Africa following Nigeria.

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  Out of its total population, about 17% is urban. The urban population is growing
at 5% per annum while the growth rate of the country's population is 3% annum.
 The Ethiopian urban structure is dominated by small size towns with the
population of 2000 - 10,000.
 Cosequently, there has been uneven pattern of urban development. Resource
allocation frequently focused on few urban centers resulting in polarized
urbanization and increased regional disparity between urban and rural on the one
hand and among urban centers on the other.
 Hence, the contribution of most small and medium urban centers has been very
low.
 In fact, most urban centers are without definite socio economic functions and
there have been minimal linkages among different urban hierarchies. This is
because past policies and institutional arrangements failed to integrate spatial
policies.
 In fact, it can be argued that Ethiopia never had stable, long term and coherent
national and spatial policies because of changing political situations.

 At the top of urban hierarchy, is one city, Addis Ababa, whose population was
estimated to reach 3 million in 2000. Hence, Addis Ababa, the primate city,
accounts for nearly a third of the country's urban population.
 In general, the urban scene of Ethiopia is dominated by primacy. Addis Ababa,
the national capital, has strong influence in administrative, political and economic
aspects on the rest of the towns in the country.
 Therefore, Addis Ababa has been the locus of increased concentration of
population, which created a wide gap between itself and the rest of the urban
areas.

Functions of Ethiopian urban Centers

Major municipalities in Ethiopia have the following responsibilities.
(1) Preparation and implementation of development plans
(2) Collection of municipal revenues

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 (3) Provision of services such as slaughterhouses, waste collection, housing basic
education, basic health care services, drainage facilities.
(4) Construction of access road, bridges, and parks, recreational centers.
(5) Delivery of miscellaneous services such as fire protection, street lighting libraries,
public toilets, etc.
 However the degree and services provided in urban centers varies from place to
place; the bigger the city the higher the provision of urban services.
 For example, waste services and feeder road construction are rendered in A.A
and Baherdar, but they are absent in Gambela and Assossa. The major reason for
low urban service or absence is because of lack of financial resources.
Urban centers in Ethiopia face the following financial problems.
- Tax bases are very narrow (number of tax payers is low).
- Tax rates are out dated and un revised
- Collection efficiency is very poor
- Enforcement of law is very poor
- Capacity to run urban affairs is poor, technical and administrative capacity
Regarding the level of per-capita income, urban centers earn very low income
(total revenue of municipalities over population)

Discretion Per Capita Income

Bahr Dar 7
Awassa 5
Gambela 2
Ethiopia (average) 7
Africa 15
Pacifica 249
Asia 252

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Industrial Counters 2,763

Sources: WB- 2001 .

Problems of Urbanization in Ethiopia

 As discussed above, rural urban migration has often been explained in terms of
the lure of ‘bright lights’ and the tales of ‘city streets paved with gold’ contrasting
with the meager conditions in rural areas.
 Expanded family, shortage of land and decline in the agricultural productivity has
forced many people to seek alternative livelihoods in cities.
 It is now generally acknowledged that ‘bright light ‘theories do not really explain
migration.
 For one thing, most migrants are so poor to take advantage of urban facilities.
Since there is generally a serious shortage of jobs in the formal sector, many
migrants end up searching a living from casual labour or in the informal sector.
 On the other hand, urban facilities could not keep pace with number of new
comers. Hence with the increasing urbanization due to migration and natural
growth, mounting pressure is exerted on urban infrastructure posing financial and
managerial problems on urban governments.
 Hence, the economic model that argues in favour of urbanization did not prove
true in the Ethiopian context.
 Instead of benefiting urban residents and migrants; the rapid rate of urban
population has reached a level where it poses serious problems to urban
development.
 Experience has proved that as urban areas grow in population, government and
the community face increasing pressures in providing services and infrastructure
facilities and effectively manage urban centers.
 Urban problems in Ethiopia have increased in recent years as the provision of
socio-economic services such as housing, employment and sanitation are found to
be not only inadequate but also deteriorating overtime.

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 Statistical evidences reveal that 90% of the country's urban population lives in
sub-standard houses (Mamo Kebede, 1992).
 Analytical reports of the 1984 census results for various regions also show the
severity of the problem of housing.
 For instance, out of the total housing units in urban areas of Shewa (central
region) 57.7% have no toilet facilities at all, 39.4% have no kitchen, 92.5% have
no bathing facilities and 34% are over crowded.
 In addition to this, urban centers lack efficient, responsive and effective
governance. They are governed by political patrons and are not accountable to the
public.
 Moreover they lack managerial autonomy to decide on their own affairs and raise
local revenue and spend on development projects. Municipalities were appended
to the central offices and perform sectoral functions, which have overshadowed
their traditional role of providing basic urban services.

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