Urbanization helping pull people out of poverty: Report

KARACHI: The move to cities goes hand in hand with human progress, but urbanization must be harnessed in ways that support low-income people, otherwise slums will proliferate and key development goals will not be met, according to the new Global Monitoring Report: Rural-Urban Dynamics and the Millennium Development Goals released on Thursday.

Absolute poverty rates are lower in urban centers, i.e. 11.6 percent versus 29.4 percent in rural areas, where 76 percent of the developing world’s poor lived in 2010, says the joint World Bank and International Monetary Fund (IMF) report. The line for extreme poverty is set at $1.25 a day, a measure that has been the yardstick for the MDG1, of halving the rate of absolute poverty from its 1990 level, a goal that was met in 2010.

Disparities are also large between rural and urban areas for the other MDGs. For example, in South Asia, 28 percent of people living in rural areas have access to sanitation facilities, compared with 60 percent in urban areas or settlements. In the Middle East and North Africa, South Asia, and Sub-Saharan Africa, infant mortality rates in rural areas are 10-16 percentage points higher than in urban areas. East Asia has the highest differential, at 21 percentage points.

“Urbanization is helping pull people out of poverty and advancing progress towards the MDGs, but, if not managed well, can also lead to burgeoning growth of slums, pollution, and crime,” says Jos Verbeek, lead author of the GMR and World Bank lead economist. Consequently, the report calls for an integrated strategy to better manage the planning-connecting-financing nexus of urbanization.

With over 80 percent of global goods and services produced in cities, countries with higher levels of urbanization, such as China, and many others in East Asia and Latin America, have played a major role in lowering extreme poverty worldwide. In contrast, the two least urbanized regions, South Asia and Sub-Saharan Africa, have significantly higher rates of extreme poverty and continue to lag on most MDGs.

The report finds that people, poverty, and service delivery are located along a spectrum from rural to urban, with many types of settlements from small to large towns. The smaller the town, the higher the incidence of poverty and less stellar access to MDG related services.

Despite the very welcome gains made in extreme poverty reduction, the world will still have 970 million people living in extreme poverty in 2015, underscoring the need to fight poverty and improve the living conditions of the poor where ever they live.

With less than 1,000 days before the expiration of the MDGs, progress continues to lag on reducing maternal and child mortality, achieving universal primary education, and providing access to basic sanitation facilities, targets which will unlikely be met by the MDGs’ 2015 deadline without a fast acceleration of effort.