Cities are drivers of economic growth, but more must be done to ensure that growth is inclusive and sustainable. The Cities Alliance Joint Work Programme on Equitable Economic Growth delves into the relationship between local public services and equitable economic growth – an important area that has not been explored.
[19 September 2016] -- This May, Cities Alliance members gathered in London to launch the partnership’s newest Joint Work Programme, on Equitable Economic Growth.
By the end of the meeting, it was clear to everyone that something special was taking place. Development partners from a range of constituencies – local government, NGOs, development organisations, and organisations of the urban poor – were coming together to focus on promoting economic growth in a new way: by exploring the link between local provision of services and equitable economic growth.
It is an important area of development that has not yet been sufficiently explored. Inequality in cities is on the rise; despite the massive wealth generated in cities, roughly one quarter of the world’s urban population – almost 900 million people – lives and works in slums.
If left unchecked, inequality can be very costly in terms of a city’s economic, social, environmental, and political future. Cities are hubs of human interaction, where the poor and marginalised live side-by-side with the wealthy and see the inequality in action every day, which can spark anger, riots and criminality. Mounting evidence also indicates that high levels of inequality reduce economic growth, as well as perpetuate poverty.
As with many development issues, cities are also where solutions to equitable economic growth can be found, and that is where the JWP comes in. It brings together organisations with different perspectives and expertise in support of something that mayors or local authorities can influence: the way public services are delivered, and to what extent this affects economic growth.
How the JWP works
Joint Work Programmes have become a key part of the Cities Alliance’s work. One of the great strengths of the partnership is its ability to mobilise a broad membership and bring together all different types of stakeholders around a single priority issue, generating knowledge and advocacy on a global level.
Our JWP on advocacy for Habitat III has developed into a strong voice for cities in the leadup to Quito, and the JWP on Resilient Cities has already helped establish the partnership’s niche in the city resilience field. Our JWP on Gender Equality has actively advocated for a stronger gender component in the New Urban Agenda.
The JWP for Equitable Economic Growth works globally and locally to identify and facilitate knowledge and concrete interventions that achieve equitable economic growth in cities. Recognising the needs and capacities of cities and local governments, the JWP works with development partners to produce global knowledge, facilitate policy dialogues and support city-level diagnostics and policy recommendations.
It has three main components:
- Global Policy Dialogue: Structured global policy dialogue to explore and address the role of local public goods and services in stimulating growth and reducing inequalities in cities.
- Generating Global Knowledge: Addressing key knowledge gaps by producing peer-reviewed global knowledge products to inform practitioners and policy makers at the global, national and local levels.
- Equitable Economic Growth Campaign Cities: Facilitating local partnerships in selected cities in partner countries, supporting the promotion of equitable access to public goods and services based on local needs, capacities and priorities.
What is equitable economic growth?
Different organisations define equitable economic growth in different ways. When the Cities Alliance began conceptualising a JWP around the issue, the first step was to define the concept for the purpose. We commissioned Professor Andrés Rodríguez-Pose of The London School of Economics and Political Science to produce a discussion note exploring the issue of equitable economic growth, how it could be applied in cities, and what international organisations are currently doing.
In broad terms, it is economic growth from which all members, or certainly more members of society, accrue some benefit. It also generally involves greater economic opportunities and decent work for low income groups, benefitting the poor and give them opportunities for a better future.
To get a better idea of how JWP members and supporters view the issue and are shaping its work, we approached two member organisations who are actively promoting inclusive cities: Women in Informal Employment: Globalizing and Organizing (WIEGO), a global network of organisations of informal workers and activists, researchers, and policy makers concerned with improving the status of the working poor, especially women, in the informal economy; and the Ford Foundation, which is committed to work on creating an inclusive economy and equitable development.
We also spoke with Ms. Clare Short – Chair of the Cities Alliance Management Board, former Member of Parliament for Birmingham Ladywood, and former UK Secretary of State for International Development – who has long been a champion of inclusive development.
Ms. Short told us that equitable economic growth must address the growing inequality in the world. “Equitable economic growth has to be growth that brings benefits to everyone, particularly those on low income. I don’t think it’s everyone gets a little bit, we’ve got to look for models that lift up the people with the fewest opportunities in life. And for their children as well.”
Marty Chen, Co-Founder and International Coordinator of WIEGO, stressed that any effort to address equitable economic growth must include informal workers, who make up the majority of the workforce in many developing countries and are often ignored when it comes to urban planning.
She characterised the workforce as a pyramid, with the bulk of resources and protection going to the top at the expense of the poor. “For us who work on the informal economy, the base of the pyramid is largely informal workers. They’re stigmatised in urban planning as illegal and criminal, nonproductive,” she noted. “This mindset needs to change and the base of the pyramid needs to be embraced. There’s large potential for growth, and if growth is promoted there, it becomes more equitable.”
At the Ford Foundation, one of the priorities is to challenge the notion that economic growth cannot be synonymous with inclusion. “We want to stress that when you pursue growth in an inclusive way, that it is actually good for economic growth. It’s not contradictory to have equality, inclusion and growth. In fact, they’re complementary,” said Jacqueline Burton, who works on the Foundation’s equitable development team.
Ana Marie Argilagos, a senior adviser at the Foundation, added, “If you look at inclusion, climate and growth at the same time, intersected, interconnected, you’ll have a stronger, more durable, deeper growth.”
Exploring linkages between service provision and economic growth
Widespread access to public goods and services is crucial to reducing inequalities and ensuring equitable economic growth. Equitable access – through effective provision, inclusive distribution and fair pricing – directly improves the social and economic well-being of citizens and makes it easier for them to find decent, productive employment. It also enables a vibrant private sector by supporting investments, job creation and the commercial strength of formal and informal businesses.
It is also a priority that we have been hearing about in the field. Dr. Rene Peter Hohmann, who manages the JWP for Equitable Economic Growth at the Cities Alliance Secretariat, recalled a conversation he had in Ethiopia with a representative of the garment industry, which is moving from Bangladesh to Ethiopia.
Asked what was important for his business, the owner replied that the biggest problems he faces are lack of access to water, bad roads that prevent his trucks from reaching worksites, lack of housing for workers, and the absence of a social infrastructure for the women working on the conveyor belt – all public goods or services.
Ms. Short agrees, but also stresses the importance of looking beyond businesses. “Improvement in public services is absolutely key, to both economic growth and to improvement in people’s lives. This is a neglected question,” she said.
“When you say economic growth, people think about businesses and opportunities for businesses. But if the transport systems don’t work, if no one is training or educating the people, the economy doesn’t work. If you don’t have a sanitation system, people keep getting sick. It damages their life, but also they don’t come to work.”
At the Ford Foundation, linking public services with economic growth is an anchor of its work in equitable development, and it was delighted that the JWP selected the issue as the cornerstone of its activities.
“Infrastructure, everything from mobility to parks to public space, and education – all these infrastructure investments need to be taken into consideration with all people in mind, especially those people who don’t have a leg up,” noted Ms. Argilagos.
For example, in New Orleans, the Ford Foundation supported the development of a green corridor that connected several lower income neighbourhoods directly with downtown business areas such as the French Quarter. Many people who work service jobs at the city’s restaurants and hotels – as well as artists, street performers and musicians – cannot afford to live in the downtown core, and public transit in the city is severely lacking. The green corridor provides bike and pedestrian pathways that connect many neighbourhoods with an easy, straight shot into the downtown areas.
“This has had a pretty direct positive effect on people,” said Ms. Burton. “They’re commuting and able to live where they can afford to live and work the jobs that they need to work.”
For WIEGO, public goods in cities include public space and public procurement. Access to these public goods is especially important to informal workers such as street traders who need space on the street to sell their wares, waste pickers who want the right to bid for solid waste management contracts, and informal transport proviers who want to be included in the design of transport systems.
“Urban renewal schemes around the world are eroding these urban livelihoods. With the stroke of a pen, a city can decide that an area with hundreds of street vendors is now a historical plaza, with no alternative space given to them,” Ms Chen noted.
She recalled the story of Devi-ben, a street vendor whom she visited in Ahmedabad, India in 2013. Devi-ben had been twice dislocated by the city. Devi-ben belonged to an artisan community which made clay images for religious festivals. But the city cut a boulevard through their artisan colony and relocated them to the outskirts of the city.
Devi-ben also sold plastic clocks and picture frames in Ahmedabad’s Bhadra Market, where informal traders have sold their wares for centuries. As part of a heritage project, the city decided to convert the open-air market into a heritage plaza , evicting the vendors. “But we are part of the heritage – part of the culture – of the city,” Devi-ben commented. (Read more about Devi-ben here.)
Medellin is often recognised as a positive example of a city that has used public investments to create economic opportunities. Another example is Bangkok, which is known for its tolerance of street traders.
Ms. Chen also stressed that, in many cases, the poor are stigmatised because they are not part of the formal workforce. “If we want the poor to be more productive, we can’t stigmatise them. In the absence of regulations, they are often criminalised,” she noted.
“In India, for example, if the city has not issued vendors a license, they are treated as criiminals under the penal code. They’re charged regularly, pay fines, have their goods confiscated – all of which have devastating effects on their livelihoods.”
Positioning the JWP for success
As the JWP takes shape and begins its concrete activities, there is no question the Cities Alliance is uniquely poised to create the space for a real discussion of equitable economic growth.
“It’s fantastic to have a place where you know you’re going to have a true and productive partnership with people from many different sectors,” noted Ms. Burton of the Ford Foundation. “It’s easy for us to get blinders on if we’re talking to people who do the same kind of work we do. Having a forum to get different perspectives is beyond invaluable.”
The May kickoff meeting in London was the first such major forum for global dialogue in the JWP, with more to come. The initial activities are focusing on connecting knowledge and experiences, both local and global.
The JWP’s first knowledge product explores the role of gender-responsive public goods and service provision in supporting equitable economic growth, drawing on concrete initiatives from cities around the world. It is currently under production. Two additional knowledge products will follow in 2017: One analysing the significance of public space for the productivity and livelihoods of informal workers, and a second looking at the role of decentralisation and local governments.
At the same time, the JWP is conducting local assessments of the institutional frameworks under which specific cities operate, and which enable or limit local service delivery. The assessments will be used to set the priorities and focus of city partnerships. The first partnerships will be formed in Uganda later this year.
Looking ahead, members we spoke to expressed the hope that JWP would expand to include more cities and local government representatives.
Ms. Chen highlighted the importance of convening city-level dialogues with organisations of informal workers, as national urban dialogues and forums tend to take move of a macroeconomic view, and the interests of informal worker aren’t represented. “It’s at the city level where there should be real ongoing dialogue and partnership,” she noted, adding that the Cities Alliance Joint Work Programme could facilitate such city-level dialogues with organisations of informal workers.
Ms. Short agreed that cities have to be at the centre of the JWP. “This is about investing in the capacities of cities themselves. It’s got to be a sustainable system. It’s not a handout solution. That won’t do.”