Urbanization does not always have as big an impact on USAID’s work as it should. For example, USAID’s Office of Democracy, Human Rights, and Governance implements a lot of local government reform and decentralization programs, but much of the focus of these programs is on subnational governance. A subnational government can be urban, but it can also be rural, so it is not always about urbanization.
Rural areas remain the primary focus of USAID’s programming because that is where the need has been perceived as being the greatest. However, people in rural areas are quickly moving into urban areas. This rural-urban migration is creating uncontrolled, chaotic growth and stretching city services. For this reason, USAID is beginning to realize that we need to shift some of our focus to addressing this explosive growth, especially in secondary cities.
I’ve been working closely with USAID’s Mission in Nepal over the past year. Nepal is undergoing massive decentralization right now. There was a constitutional amendment in 2015 that transformed the country from a unitary state into a federation of provinces. Along with that, Nepal enacted legislation that greatly empowers provinces and municipalities to provide many services they were not previously responsible for. The Government of Nepal is also transferring funding down to the subnational level so that municipalities can provide these services. USAID will provide support to this process through a new activity, Sajhedari (Nepali for “partnership”). The program was initially going to have a largely rural focus, but Nepal’s rapidly growing secondary cities convinced the Mission to add urban areas as a focus. It is probably going to be a long and bumpy transition before Nepal’s municipalities are up and running and providing services.
The massive demographic shift of people moving from rural areas into cities continues. Cities are bursting at the seams. Huge, informal settlements are developing on the periphery of many urban areas. These settlements are either underserved or do not receive any services at all. In some cases, this situation can lead to the creation of dangerous, ungoverned spaces.
USAID and other development agencies have realized that activities designed to stem the tide of urbanization by trying to improve living conditions in rural areas have largely failed. Central governments and development agencies are, often reluctantly, realizing that local governments need greater authority and resources to keep up with their growth.
I think that USAID will continue to work with governments to create the legal framework needed to devolve power and resources to municipal and other subnational governments to help deal with this growth. USAID’s work will continue to help improve the capacity of subnational governments to govern and provide services. I think a new emphasis in this work will be on subnational domestic resource mobilization (DRM), which is an important component of the Journey to Self-Reliance.
USAID’s programs have long dabbled in working with municipalities in helping them increase the amount of taxes and fees that they are able to raise, but it was never a big priority. Now, USAID is increasing its focus on subnational DRM for a couple of reasons. First, local governments need to become more self-reliant and less dependent on central governments and/or donors. Second, we believe that when the citizens of a city are directly taxed by their local government, they will be more likely to hold their city officials accountable then when funding is simply transferred from the national level.