URBANIZATION INDUSTRIALIZATION AND WEALTH CREATION IN UGANDA UNECA
URBANIZATION, INDUSTRIALIZATION AND WEALTH CREATION IN UGANDA UNECA Lands, Housing and Urban Development Joint Sector Review 6 th – 7 th November 2019 KAMPALA 1
UGANDA’S URBAN POPULATION • 8. 1 million more people in cities 2020 -2030 • Like adding 2. 33 more GKMAs • 75% of the urban population is under age 30. 2
GDP BY SECTOR 3
EMPLOYMENT BY SECTOR 4
Unleashing the potential of Uganda’s cities and urban areas 1. URBAN PRODUCTIVITY: How cities can make Uganda’s economy grow and compete? 2. NATIONAL SPATIAL SYSTEM: Focusing interventions where they will have impact based on economic and social needs 3. ECONOMIC SECTOR TARGETING: To create urban jobs and leverage urbanization for inclusive economic growth 4. COORDINATION AND FINANCE: For effective policy coordination 5
Urban Productivity How cities can make Uganda’s economy grow and compete 6
CHARACTERISTICS OF PRODUCTIVE CITIES Well-functioning cities bolster productivity Institutions - Property markets work -> location choice - Clear regulations & taxes - Goods markets work - Labour markets work (pooling, skills) Poorly-functioning cities reduce the urban productive advantage - Hard to get land, permits - High transactions costs - Constrained supply -> high cost of living - Jobs-workforce mismatch (skills, location) - Easy access to electricity, utilities Infrastructure - Easy commutes, multimodal options - Efficient freight - Outages & unreliable utilities - Long, unpredictable, costly commutes - Slow, inefficient freight - Density & clustering - Knowledge spillovers Spatial layout - Dense markets /urban form - Social mix -> economic mobility - Connectivity -> market access - Sprawl -> long, costly travel - Separation reduces knowledge spillovers - Segregation -> poverty traps - Poor connectivity reduces market size & access Takeaway: Cities -> costs to firms & households -> productivity & competitiveness 7
National Spatial System Focusing interventions where they will have impact based on economic and social needs 8
Diverse, balanced and connected national urban systems enable industrial development 9
GKMA dominates the national urban system • 42% of the urban population • 46% of formal sector workers • 70% of manufacturing firms with five or more employees City populations in 2017 and 2040 according to a business as usual (BAU) scenario and the National Physical Development Plan (NPDP) 10
COMMON URBAN LOCATION PREFERENCES FOR VARIOUS INDUSTRIES Sector type Common location preferences Knowledge-intensive; skill-intensive; Large, diverse city R&D; innovation-intensive New firms, startups Large, diverse city Land-intensive industry Urban periphery or secondary city with low land cost Mid-sized cities with low cost of living Labour-intensive industry Input-intensive industry; Initial Close to source of inputs processing of raw commodities 11
Economic Sector Targeting To create urban jobs and leverage urbanization for inclusive economic growth 12
SECTORS WITH URBAN JOB CREATION POTENTIAL 13 2017 World Bank,
Coordination and Budgetary processes For effective policy implementation 14
INSTITUTIONAL COORDINATION FOR ALIGNMENT IN PLANNING AND IMPLEMENTATION 15
CALL TO ACTION • For urbanization to drive economic growth, NDP needs to define and coordinate priorities and investments • A cross sectoral response to rapid urban growth is necessary as programs and investments within and outside the urban sector shape urban development outcomes • Creating productive urban jobs in manufacturing and services is a top priority for structural transformation • Coordination and alignment of spatial and economic planning is key in leveraging urban growth for industrialization • Data disaggregation is a necessary foundation for effective and evidence based policy responses to rapid urban growth 16
FOCUS ON IMPLEMENTATION What a useful plan! People can live here one day! Bahir Dar Urban Expansion Initiative, Photo: NYU Marron 17 Institute
yemeru@un. org Thank you! 18
- Slides: 18