The city’s role as an engine of economic growth has become more important as the world becomes increasingly urbanised. It is critical for cities to be strategic about their investments and growth in order to capitalise on opportunities.

A City Development Strategy is a tool that helps a city harness the potential of urbanisation. It also enables a city to develop a coordinated, institutional framework to make the most of opportunities. And, perhaps most importantly, a CDS gives residents a chance to have a voice in the future of the place where they live.

The Cities Alliance supports cities in preparing city development strategies that link their economic growth and poverty reduction objectives, often including citywide slum upgrading strategies.

Why cities?

What is a CDS?

Why is a CDS important?

How does a CDS benefit residents of a city?

What are the characteristics of a successful CDS?

Can you take CDS and use it as a model for other cities?

What are the steps involved in a CDS?

What are the outcomes of a successful CDS?

How do you measure the impact of a CDS?

What is the role of the Cities Alliance in CDS?

City Development Toolkit


Why cities?


  • In Brazil, around 80 percent of the population lives in cities.
  • Mumbai generates about 5 percent of India's GDP and contributes over one-third of the country's tax revenues.
  • Two-fifths of cities with populations between one and ten million, and 15 megacities, are on or near a coast, where many are at risk of flooding. (Source: The Economist)

Cities around the world are growing like never before. Today, more than half of the world’s population lives in cities. This trend is expected to continue as more and more people flock to urban areas in search of opportunities and a better life. By 2060, the world is likely to be fully urbanised, with more than 80 percent of the population residing in urban areas.

This rapid urbanisation has brought with it both extraordinary challenges and tremendous opportunities for cities. In order to thrive, cities must find ways to adapt to emerging challenges and leverage their strengths.

Some of the major challenges cities are facing today include: 

Unprecedented population growth rates. Migration, combined with natural population increase, has resulted in unprecedented urban growth rates. Urban areas are growing most rapidly in the developing world, where cities gain an average of 5 million residents each month. (Source: UN-HABITAT)

Increasing urban poverty. As the numbers of urban poor grow, inequalities in opportunity and income deepen. Nearly three-quarters of Africa’s urban residents live in slums, often unrecognised and unserviced by their local governments.

Decentralisation of responsibility to the local level. An imperfect process at best, decentralisation of responsibility to the local level is often not matched by the allocation of resources or authority.

Climate change. Cities, particularly in developing countries, are especially vulnerable to climate change due to the large concentration of populations and their role as national economic hubs. Many urban areas are located on the coast, making them susceptible to rising sea levels. In addition, the impact of climate change on rural areas—such as drought, coastal flooding and strong storms—is driving more people to migrate to cities in search of livelihoods. Among a city’s population, the urban poor are most vulnerable to the effects of climate change.

While these challenges seem daunting, cities—and countries—also have tremendous opportunities to benefit from urbanisation. These opportunities include: 

Economic growth. Cities are essential to economic growth. As a major source of job creation and wealth generation, cities produce goods and provide services that strengthen economic opportunities for the entire country. Cities account for more than 80 percent of global economic growth.

Poverty prevention and alleviation. Cities can play an active role in fighting poverty. Metropolitan areas create enormous income and wealth, and the capital they generate can be used to help alleviate poverty. In addition, people in cities tend to earn higher incomes than those in rural areas; in countries such as China and Thailand, urban incomes are four times higher than their rural counterparts.

Efficiency. Cities have the potential to be efficient in a number of ways. Higher population density means that it is more cost-effective and easier to extend services such as sanitation, education, and health care to residents. Proximity to roadways, rails, ports and airports reduces time, travel and energy costs.

Dynamism. Modern electronic communication and easier travel mean cities across the globe are interconnected as never before, resulting in a new economic dynamism. The capital markets of the developed world are easily linked with the human capital and new economic vitality of nations such as India and China. Cities are also centres of innovation and culture; they are magnets for the world’s thinkers, corporations, universities, banks, and industries.

Opportunities for shared learning. As cities across the globe grapple with urbanisation, they are recognising the value of learning from each other. City networks are valuable resources cities can tap into to learn how other cities are addressing similar challenges and opportunities.

Greater potential to influence popular behaviour. Because urban areas are such concentrated population centres, it can be easier to reach and influence a greater number of people to change their behaviour on important issues, such as resource consumption, climate change and HIV/AIDS, for example.

Strategic City Planning


What is a city development strategy (CDS)?
A city development strategy is defined as an action-oriented process, developed and sustained through participation, to promote equitable growth in cities and their surrounding regions to improve the quality of life for all citizens.

A CDS helps cities integrate a strategic development approach and a long-term perspective into their urban planning. With a CDS, cities move beyond planning around the short-term political or donor-funding cycle to considering where they should be in 20 or 30 years, and the steps that need to be taken to achieve those goals.

The idea behind a CDS is that well-positioned, well-timed public, private and civil society strategic interventions can significantly change a city’s development path and improve its performance.

Why is a CDS important?

The city’s role as an engine of economic growth has become more important as the world becomes increasingly urbanised. It is critical for cities to be strategic about their investments and growth in order to capitalise on opportunities.

A city development strategy is a tool that helps a city harness the potential of urbanisation. It also enables a city to develop a coordinated, institutional framework to make the most of opportunities.

A CDS helps a city:

Allocate resources strategically. By focusing on at most five key strategic thrusts, a CDS helps a city allocate limited resources in areas where they will make the most impact.

Attract capital and discipline its use. Developing cities need discipline to most effectively use their limited financial and human resources to achieve targets. In addition, the capital available to any given city flows to cities that show potential and have well-thought-out urban futures. A CDS can both attract capital and help the city use that capital in a disciplined way.

Clarify the vision for its future. A CDS is designed to shock the system under controlled conditions and catalyse new thinking about the city’s future. An effective CDS assesses a city frankly and objectively, enabling the city to see its future more clearly and identify the best ways forward.

Build necessary partnerships. Although they are critical to the process, local governments alone cannot turn a city around. A CDS helps local authorities work in partnership with national governments, private interests and civil society to change a city’s developmental direction.

Anticipate future shocks. A good CDS can help a city anticipate future shocks and rapidly changing risk environments. It can also increase understanding of how stakeholders would respond under various scenarios.

Plan for growth. A CDS helps a city anticipate the rate, type and physical direction of growth and develop infrastructure ahead of that growth.


How does a CDS benefit residents of a city?

Residents have a vested interest in their city. People want to live in a place that offers them a decent quality of life, with job opportunities, good transportation systems, access to services, quality education and health care, entertainment choices, and public spaces for gathering.

A CDS gives residents a chance to have a voice in the future of the place where they live. It is a way that they can participate in the process of shaping and realising a strategy for their city and subsequently monitor the government’s progress in achieving that strategy.

Greater participation in the city development process is often accompanied by a greater sense of responsibility and a change in the way residents view their city. Instead of focusing exclusively on what the government is going to do for them, residents work together and share responsibilities to make their city a better place to live. This greater sense of responsibility could range from a small action, such as not throwing trash on the street, to a group of neighbouring business owners who join together to make their block more appealing to shoppers.


What are the characteristics of a successful CDS?

Effective city development strategies have the following characteristics:

Internal consistency. The strategic thrusts of a CDS should follow from the vision and analysis of a city’s strengths, weaknesses, opportunities and threats.

Targeted scope that focuses on a few strategic thrusts, the products of tough choices. Nothing is of equal importance.

Measurable achievement by using lean, powerful, results-oriented indicators

Cross-cutting strategic thrusts that rely on a variety of activities and agencies

Clearly defined targets and responsibilities. Responsibility for implementation is clearly defined against definitive targets and timelines

Incentives to drive performance. These can take a variety of forms, such as financial, awards and community recognition.

A flexible framework and constant vision. The strategic framework is flexible enough to adapt to changing conditions and tactics, but the vision remains constant over the medium term.

CDS priorities reflected in budgets. The CDS priorities should be reflected in a city’s budgeting and investment strategies.

Extended ownership. While it is important to have a champion drive the CDS process, it is equally vital that ownership of the vision and strategy extends well beyond the champion. This is especially important if the champion is an elected official whose term will likely end long before the vision for the city will be realised.


Can you take a CDS for one city and use it as a model for other cities?

Although each city’s CDS is unique, experience has shown that virtually all successful cities deal with these five themes: livelihood; environmental quality, service delivery and energy efficiency; spatial form and infrastructure; financial resources; and governance.


The bottom line in every city is household income. A successful CDS addresses job creation and support for the small businesses and individual entrepreneurs that make up much of the work force in developing cities. It should also include human resource development, so that the population will have the skills needed for the emerging urban economy.

Environmental quality, service delivery and energy efficiency

Given the rising cost of energy, the increased frequency of natural hazards in many cities, the vulnerability of freshwater sources, as well as urban sprawl and related mobility costs, environmental and energy considerations should become part of the core CDS process. An effective CDS also suggests incentives to encourage more efficient use of energy in industrial processes, building construction and use, household consumption, and urban form (the spatial imprint of an urban transport system as well as the adjacent physical infrastructures).

Spatial form and infrastructure

While cities should be concerned about their spatial form, it typically does not dominate the content of a CDS. From a strategic perspective, spatial form is of particular concern in three main areas: the close relationship between urban form and energy efficiency; the close relationship between attractiveness of cities and economic performance; and the critical importance of land in addressing the challenges of slum communities.

Financial resources

The way local governments manage their financial resources is important for a city’s development. In addition, CDS processes should include an understanding that it is the role of the local government to mobilise financial resources, both from within and from outside the city as well as from public, private and civil society sources.


It is clear that local governments have a key role to play in urban development. An effective CDS programme also addresses several other aspects of governance:

  --  The development of national policy frameworks, both explicit (such as urban infrastructure grants) and implicit (such as the effect of changes in tariff structures on key firms in the urban economy);

  --  The changing role of urban government as a result of decentralisation, which involves the transfer of responsibilities from the national government to the local government; and

  --  The question of metropolitan governance, in which a city suffers from inefficiencies and lost opportunities due to fragmented, uncoordinated governance among a number of local governments.

What are the steps involved in undertaking a CDS?
In 2009, the Cities Alliance formed a platform for members, called the CDS Sub-Group, to increase collective know-how on city development strategies. The Sub-Group will work together to develop a CDS conceptual framework that outlines the building blocks of a state-of-the-art city development strategy.

According to the CDS guidelines that were published previously, the key methodology of a successful CDS includes the following eight building blocks:

Initiating the process. There is a need for high-level guidance and coordination; if the mayor or equivalent is not seriously involved in the CDS process, it should be abandoned. The process should be guided by a group of key stakeholders representing major interest groups in the city who can negotiate hard content.

Establishing the initial parameters and the scope of the CDS. The initiating process needs to result in agreement on the spatial scale of the analysis—whether it covers the extended urban region, the metropolitan region, or the city proper. Defining the breadth of issues to be covered by the CDS is more difficult. Generally, if a city has not done high-quality CDS work, a wide spectrum is best; in cities where the opposite is the case, a more focused substantive field of action may be appropriate.

Making an initial assessment. The city should be assessed initially by a team of experts. This assessment should zero in on spatial areas and substantive issues of particular concern. It should also identify and assess core change drivers, such as demographics, technology and the international economic environment.

Formulating a vision. A vision is a statement of where a city wants to be, usually ten to 15 years in the future. The vision statement needs to be specific, internally consistent, and realistic but challenging. It should stress what is unique about the city and be short (less than 60 words) as well as easy to read. Successful cities are flexible and adaptive in pursuing their visions, recognising that rigid, static or top-down planning can be harmful. For example, the Laoag City in the Philippines developed the following vision for its CDS: “By the year 2022, Laoag, the Sunshine City and Northern Gateway of the Philippines, will be a ‘Metropolitan Centre in the North’ where economic growth and development abound for its people to equitably share and enjoy.”

Identifying strengths-weaknesses-opportunities-threats (SWOT analysis). A SWOT analysis should be undertaken within the context of vision. The results enable a city to build on and leverage its strengths and opportunities. It also enhances a city’s ability to avoid threats or take action to minimise them.

Setting strategic thrusts. Strategic thrusts are the heart of a CDS. They are cross-cutting, interlocking actions, delivered in many ways, that bring about maximum impact cost-effectively. Because a city cannot focus on too many initiatives at one time, strategic thrusts are normally limited to five.

Building awareness. A successful CDS process needs the support of most of the community, especially the key stakeholders. The most effective ways of disseminating a CDS vary from city to city and rely on a mix of media, such as Internet sites and radio. Certain media—newspaper inserts, videos, posters, and models—work well across a wide spectrum of cities.

Starting implementation. A CDS is of no value unless it is implemented. Implementation Task Forces should be established, responsible for each strategic thrust. They in turn formulate more detailed action plans with clearly stated responsibilities, timelines, milestones, and expected inputs and outputs.

What are the outcomes of a successful CDS?
Whether a CDS is successful or not depends on its main strategic goals. For example, if a city emphasised poverty alleviation in its CDS, then a reduction in the number of poor residents would be a successful outcome.

Broadly, the outcomes of a successful CDS include:

Behavioural changes, in which the process of how to deal with strategy becomes embedded in local planning and among citizens. It also involves the development of an ongoing process to constantly update the CDS.

Monitoring mechanisms for urban performance so that citizens, local governments and the private sector can all measure development.

Policy and institutional reforms, such as consolidating disparate agencies or the development of mechanisms for cooperation that increase efficiency.

Public and private sector investments in key strategic activities.


How do you measure the impact of a CDS?


In order to evaluate the impact of a CDS, it is necessary to determine indicators that will be used and monitor the results.

This is done by using a framework for monitoring and evaluation that provides key actors—especially mayors and city managers—and citizens with a tool for setting targets and for measuring city development. 

Mumbai: Using the Web to Track the City’s Transformation

A massive initiative is currently underway to transform Mumbai, India’s financial and commercial centre, into a world-class city with a vibrant economy and a high standard of living for all citizens.

The initiative is coordinated and monitored by the Mumbai Transformation Support Unit (MTSU), which has established a web site ( so that the public can track the progress of the more than 40 projects that are part of the initiative.


Determine indicators, baselines and targets

The most successful cities develop a monitoring and evaluation framework during their CDS planning process that includes a matrix of performance indicators, baselines and targets for each of the CDS objectives. Examples of indicators include GDP, the population growth rate, the per capita allocation to health services, the number of low income households connected to water, or the crime solution rate.

It is important that these indicators are realistic and limited to a reasonable amount. Many monitoring systems fail because they have too many or unrealistic indicators and allocate no money for their ongoing operation.

Set milestones

Because a CDS is a long-term process lasting at least 10 to 20 years, goals and targets are often staggered or milestones set along the way in order to gauge the impact of an ongoing CDS. This staggered approach also helps sustain support for the process among stakeholders and citizens.

Identify who will use the monitoring and evaluation framework

During the CDS planning process, it is also important to identify who will use the monitoring and evaluation framework and how the information will be collected, analysed and disseminated. Generally, the involvement of stakeholders and independent actors in monitoring and evaluation activities can greatly enhance implementation of the strategy.


What is the role of the Cities Alliance in CDS?
The Cities Alliance is involved with city development strategies in the following ways through its members:

Technical assistance. The Cities Alliance continues to provide technical assistance to cities to help prepare city development strategies.

Shared learning. By facilitating shared learning among members, the Cities Alliance increases collective know-how on CDS.

Advocacy. The Cities Alliance actively promotes the importance of strategic planning to local and national governments.

Taxonomy of members. The Cities Alliance is in the process of compiling a catalogue of members’ CDS activities around the world. This taxonomy will make it easier for local governments and other authorities involved with CDS to know at a glance which members can provide the support they need.