Header photo credit: peeterv / Getty Images (via Canva Pro). Traffic and street market in Ikorodu district, Lagos.

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Note: This article presents the views of the authors featured and does not necessarily represent the views of the African Cities Research Consortium as a whole.

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Earlier this month, our CEO Professor Diana Mitlin participated at the 9th Urbanization and Development Conference, organised by the World Bank and the International Growth Centre in Cape Town.

As a former economist, Diana has long been keen to bring economists into conversation with other development practitioners and researchers.

Reflecting on the varied discussions at the conference, Diana said:

“In many African cities, we are witnessing remarkable urban innovation. This is often driven by local governments working alongside organised communities, businesses and researchers. It is crucial that we recognise and nurture this organic growth.

There is immense value in integrating economics into urban studies; this interdisciplinary approach offers profound insights into the dynamics of urban development.

Conversely, it is equally important for economists to engage directly with urban realities, moving beyond abstract data to understand the complex, interwoven relationships that define our cities.” 

You can watch Diana’s contributions to the conference below, where she presented “Understanding the contribution of housing to economic development”, pushing back again the idea of “consumption cities” and “sterile agglomeration”. Instead, she highlighted the economic potential of working with small-scale businesses located within informal settlements to generate growth from below.

Diana also acted as a discussant in a policy-focused session on solutions for prosperous African cities, emphasising the importance of understanding the realities of people within cities and the dominance of informal settlements, and also the role of urban reform coalitions.

Read our research on:

> Structural transformation

> Land and connectivity

Note: This article presents the views of the authors featured and does not necessarily represent the views of the African Cities Research Consortium as a whole.

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Header photo credit: ninastock / Pixabay. A busy street in Nairobi, Kenya.

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By Kunal Sen, director of UNU-WIDER

Structural transformation involves the movement of workers from low-productivity to high-productivity sectors – often from agriculture to manufacturing and services – and is a necessary condition for sustained economic growth.

Around the world, we tend to see urbanisation and structural transformation happening together – as countries urbanise, productive jobs are created in manufacturing and services. But while sub-Saharan Africa is undergoing considerable urbanisation (and driving global urban expansion), the structural transformation that we would expect to see – and have seen, for example, in East Asia and Latin America – is largely absent in the region. One major challenge created by this absence is a lack of well paid, formal jobs to meet the needs of a growing population.

How can we bridge this gap between urbanisation and structural transformation in African cities? This is the question we are seeking to answer with ACRC’s structural transformation domain research, led by UNU-WIDER.

What drives structural transformation?

Over the last two years, we have worked closely with researchers in six African cities – Accra, Ghana; Addis Ababa, Ethiopia; Dar es Salaam, Tanzania; Harare, Zimbabwe; Lagos, Nigeria; and Nairobi, Kenya. Using a combination of quantitative and qualitative methods, we have built on concepts developed in the Effective States and Inclusive Development (ESID) programme, with the aim of better understanding the political economy drivers of structural transformation – and the implications for individual cities.

To know how political economy drives structural transformation, we need to understand the way that cities, states and business interact. Historically, when we have collaborative or synergistic state–business relations – whether at the city, subnational or national level – we tend to see economic growth and structural transformation. That has certainly been the case in East Asia and Latin America. But what about in African cities?

To answer this, we categorise different types of enterprise, and look at which are most conducive to structural transformation.

> Magicians

Manufacturing and tradeable services firms – including IT and tourism – are key to structural transformation. They are export-oriented firms that drive investment and growth, but also rely on the state for policies that help them prosper and grow to face world competition. We call this set of firms “magicians” because they are competing in the global market and export within those constraints.

> Workhorses

Along with magicians, we also tend to see “workhorses”. These are informal enterprises, both in services and manufacturing, that operate mostly for the domestic market. Street vendors are a classic example of workhorses in African cities. They are not very productive enterprises, but they are important because they also face and create competition in the domestic market.

> Powerbrokers

The final group key to understanding the political economy drivers of structural transformation are “powerbrokers”. Powerbrokers are enterprises – such as utility companies, telecommunications providers and real estate firms – which also produce for the domestic market but tend to have a large share of the market. As they do not face the same competitive pressures as workhorses or magicians, they hold a lot of power.

We argue that the growth of magicians – and potentially workhorses – is crucial to driving structural transformation, while powerbrokers need to be kept in check. The role of powerbrokers in this scenario is to provide inputs, such as electricity and road infrastructure, that facilitate the growth of magicians and workhorses. Regulating the market power of powerbrokers is important to ensure that essential inputs are provided to magicians at reasonable cost.

Relationships with elites in African cities

We collected data and conducted key informant interviews with several enterprises in our six focus cities, along with speaking to business elites, political elites, city leaders and so on. Broadly, what we found is that powerbrokers tend to have fairly closed relationships with business elites and working elites. In other words, at the city level, only a few firms regularly engage with bureaucratic or political elites. These are also what we call ordered relationships – in essence, the relationships are reliable, and each party knows what they are getting.

We find that these kinds of closed and ordered relationships with powerbrokers can be problematic, for two main reasons. First, they can lead to situations with a lot of collusion, rents being shared and, in some cases, even corruption. This is not a good thing, and often means that powerbrokers are not really under pressure to supply good quality inputs to magicians and workhorses. Second, because powerbrokers are in this closed relationship with political and bureaucratic elites, they receive a lot of attention and the elites do not have the same level of interest in magicians and workhorses.

Conversely, workhorses and informal enterprises tend to have disordered relationships with local elites and city officials. This creates an unstable business environment which is not conducive to economic development. Consequently, it is unsurprising that in African cities, we tend to find very small household enterprises that do not grow or employ other workers. As for magicians, they are key drivers of structural transformation, but we find very few of them in African cities.

Wanted: More magicians

So, why are magicians missing in African cities? In our view, there are two main reasons.

First, they are not of strong enough interest to political and city elites – in part because they are not yet of a notable size or scale and there are not enough of them. Second, they need good infrastructure, which is currently lacking in these cities. They need ports, electricity, and business environments to facilitate their growth. And the absence of these essential conditions is, of course, partly linked to the lack of interest from political and city elites.

This is something our research has uncovered as fundamentally important in understanding why we have not yet seen structural transformation in sub-Saharan Africa, despite rapid urbanisation. To drive structural transformation in African cities, we need to find a way to build an environment in which magicians can grow and nurture stable and predictable relationships with elites.

Watch our structural transformation explainer video with Kunal Sen:

Header photo credit: Erik Hathawa / Unsplash. A market in Addis Ababa, Ethiopia.

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Header photo credit: Kofi Bhavnani / Unsplash. A busy street in Accra, Ghana.

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ACRC has published a new report exploring the political dimensions of urban development in Harare, Zimbabwe. Authored by George Masimba and Anna Walnycki, the paper synthesises key findings from research undertaken by in-city researchers, analysing how Harare’s political settlement and city systems shape its urban development domains. It aims to provide an overview of the political economy of development in Harare and identify priorities for future action research and interventions.

Harare’s political terrain is highly complex, providing both challenges and opportunities for transformative urban progress in the city. Post-colonial decentralisation in Zimbabwe has led to de-racialisation but not democratisation, with local government institutions having little autonomy and enduring significant interference from central government.

Over the last two decades, Harare’s infrastructure has largely collapsed – connected to national-level macro-socioeconomic and political developments. With reconstruction requiring an estimated $10 billion, Zimbabwe’s political isolation at the international level has left the city unable to secure funding to address critical systems failures. The research findings show the contested and contingent nature of urban systems in Harare, with hyperinflation, exclusionary regulatory frameworks and a growing population only compounding these difficulties.

Against this backdrop, the report explores findings from four urban development domains: informal settlements, land and connectivity, neighbourhood and district economic development, and structural transformation. Within every domain, informality was cited as a binding constraint, with the recommendations made in this study highlighting the need for council-led integration, regulation and institutionalisation of informal practices.

Informal settlements

The nexus between informal settlements and politics in Harare is much debated. Low-income areas are sites of political contestation, with elites making critical decisions and ordinary residents facing the consequences. As well as dealing with inadequate basic services, low-income urban residents have to cope with everyday challenges of land tenure precarity – including evictions and demolitions.

There are more than 60 informal settlements in Harare. Despite strong ties with political elites, grassroots political structures are often not recognised at higher levels of government. As a result, politically connected local actors have become adept at navigating formal authorities in their struggle for land tenure security. While many upgrading and regularisation processes have been led by politically aligned groups in informal settlements, other actors – including central government – have also been involved and there are examples of successful participatory initiatives.

Land and connectivity

Areas of high-density housing – mainly for low-income residents – have grown significantly over the last two decades in Harare.

The research finds the land and connectivity domain in Harare to be characterised by competitive land authorities, stressed physical planning systems, strategic infrastructure gaps and fragile urban land management. These difficulties have driven the city’s failure to optimise land for development and led to a struggle with policy and administrative structures.

The authors argue that joint action between the city council and national government is key to resolving strategic land conflicts and regularising settlements legally within Harare’s jurisdiction. This has the potential to open pathways to secure tenure and formal urban land administration in the city.

Structural transformation

Harare has witnessed rapid urbanisation, but little growth. Deindustrialisation and informalisation of the economy, originating from massive GDP loss between 1999 and 2000, have been worsened by disruption arising from the Covid-19 pandemic. Many workers lost their jobs and incomes, and more than 76% are now employed informally.

The city is in a precarious financial situation, due to national macroeconomic challenges and inconsistent fiscal transfers from central government over the last 20 years. New avenues to finance social services and critical infrastructure are urgently needed to drive an economic agenda that in turn catalyses growth-enhancing structural transformation.

Yet, while the situation seems bleak, the research highlights myriad opportunities to recapture development and push for change. By working closely with city authorities and national government, there is scope to take advantage of “low-hanging fruit” – such as creating a new vision for the city by developing a new spatial transformation programme to guide urban development. Support will be needed if Harare is to develop an overarching vision – but discussions are already underway.

Neighbourhood and district economic development

With 37% of the nation’s urban population living below the poverty line, Zimbabwe’s informal economy plays a significant role in poverty reduction, job creation, income, livelihoods and food security enhancement. As Zimbabwe’s primary economic and commercial hub, Harare attracts residents from surrounding areas, who contribute to an informal sector accounting for 58% of employment in the city.

Household microenterprises (HMEs) are a prominent fixture in Harare’s informal sector, but there is little research into the challenges they face. Reliable information around the scale, magnitude, character and spatial distribution of the informal economy is limited by a lack of coordination across government ministries, public bodies and local authorities. HMEs also face obstacles in the form of inadequate labour protection and social security provisions for informal workers, along with weak collective bargaining and representation of rights.

A number of current reforms are identified in the report – some taking place already, as well as potential interventions. These include the launch of the Informal Sector Policy (SME) in 2023, the opportunity afforded by membership associations to inclusively reshape the informal sector, and the growth in grassroots collective savings as an instrument for informal traders to access funding.

The research highlights that development processes in Harare are inseparable from politics, meaning that politically nuanced approaches and sustained commitment from elites are critical to confront urban challenges.

Header photo credit: VV Shots / iStock. Busy traffic on Samora Machel Avenue in Harare, Zimbabwe.

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Research findings

Political settlements

Politically, Accra was outlined as swing voting city with 3.6 million registered voters. With a multiethnic population, power in the city is dispersed and distributed across various actors, including 29 mayors, members of parliament and traditional rulers. The local chiefs, given their position as gatekeepers, were found to exploit residents for their own gains. The city is also subject to frequent political transitions and a weak decentralised system, driven by politically motivated fragmentations whose efficiency in governance and service delivery is highly questionable. The city’s economic viability is exacerbated by competition from different government levels, unresolved boundary rows between different regions, divergent interests from different actors and overall governance challenges.

Economic front

Using indicators for inclusive growth, such as movement of labour from the low-productivity agricultural sector to equally low- or moderately productive sectors in Ghana, the research established that structural transformation has occurred in Accra over the last decade. Lack of worker fidelity, macroeconomic instability, increasing sole proprietorship, high inflation and limited access to infrastructure for business were identified as key constraints to structural transformation.

As far as neighbourhood and district and economic development is concerned, the research found several issues to be hampering the operations of small-scale traders in the city. These include a lack of affordable credit, challenges in accessing spaces for business operations, and unregulated conduct of “market queens”.

Built environment

Land was identified as an emotive issue in Accra – proving to be a major source of tension and a driver of various distributional demands for national and city authorities. Land tenure rules deny indigenous people access to land for agricultural purposes, with chiefs wielding power and control over the same. The high cost of land, increasing land disputes, poor planning and weak enforcement of regulations have adversely impacted land and connectivity in Accra. The poor performance of land taxation and property tax revenue streams have further incapacitated the government’s service delivery. Even though the government is working on a unified revenue collection system, there is a need to invest in administrative and technical capacities to provide oversight for revenue collection in the city. Enhancing mobility and accessibility within Accra is another key priority, requiring intentional investments in urban transport infrastructure and possibly reviving deliberations around the bus rapid transport system.

The research identified more than 265 informal settlements within Accra, with over 60% of the city’s population living in poorly planned and overcrowded housing conditions occasioned by rapid urbanisation. These highly populated informal settlements were found to be based on a symbiotic relationship between politicians and residents, where support for political power was traded for favour and recognition. Politicians and other powerholders – including religious and traditional leaders – were found to exploit residents of these settlements for electoral and political purposes, using their power to lobby for certain programmes via both formal and informal channels. Following successes registered by previous reform efforts on slum upgrading, there is a need to explore informal upgrading to enhance access to basic infrastructure and improved housing, and to safeguard tenure security to reduce spatial inequality and improve life chances for informal settlement residents.

Closely tied to these findings was the housing domain research, which established that 47.6% of residents in Accra live in rented spaces and an estimated 16.7% live in non-conventional housing structures, including kiosks, metal containers and wooden structures. Increasing demand for rental housing has driven private informal housing providers to deliver substandard housing to meet soaring demands. Weak enforcement of housing regulations and limited access to land in areas closer to work has exposed renters in Accra to exploitation.

Despite high rental demands occasioned by deficits in housing, Ghana’s housing policy has not prioritised rental markets. Given this gap, there is a need to explore public–private partnerships and sustainable funding models for the provision of rental housing in the city. Additionally, alternative measures are needed to improve access to land and facilitate the construction of houses close to popular working areas.

From evidence to action

Given the interrelated nature and systemic challenges of Accra city, there is need for innovative approaches to drive action across policy, practice and programmes in relation to affordable housing, the land tenure system and economic development. Ghana’s FCDO office, ministers and reform coalitions on urban transformation committed to advance different facets of the work, calling for an integrated approach in developing sustainable urban solutions.

ACRC’s collaboration with the Ministry of Local Government and Rural Development was deemed particularly beneficial to resolving interrelated and systemic challenges in Accra. And while the workshop positioned ACRC as a commendable initiative, key actors challenged the consortium to prioritise translating the research into impactful policy and practice, to secure affordable housing, economic development, and land tenure for Accra’s residents. Stakeholders called for follow through on implementation of the stalled rapid bus transfer to enhance transport, mobility and efficiency of the public transport system in Accra.

Photo credits: KnowYourCity TV Ghana

Note: This article presents the views of the author featured and does not necessarily represent the views of the African Cities Research Consortium as a whole.

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By Rosebella Apollo, ACRC research uptake officer

The ACRC Nairobi team convened a final research uptake workshop on 9-10 March 2023. The two-day event aimed to stimulate policymakers, community representatives, county government officials, urban practitioners and professionals, to actively champion reforms for positive urban transformation in the city.

The workshop marked the close of the foundation phase of ACRC research in Nairobi. Over the past two-year period of co-creation and co-production with key stakeholders, ACRC has generated robust knowledge, expanding the frontiers of evidence‐informed decisionmaking in the city. This uptake workshop provided an additional platform for disseminating evidence from ACRC. The proceedings gave a clarion call for stakeholders to take action towards enhanced service delivery, poverty reduction and improving life chances for residents in the city.

Evidence from ACRC research delineated Nairobi as integral to Kenya’s national politics; a hub for trade and business. Politics in Nairobi city directly facilitates or constrains commitment from elites to spur inclusive development. Central to the politics are prevailing ethno-inequalities, regional imbalances and electoral systems that reward ethnic patronage. Although the city has just elected a new governor from the government of the day, he has to work closely with elected officials from the opposition to deliver his mandate in the city.

Based on this analysis, key forces to support potential reforms in the city include the county governor, the Nairobi county assembly, the national executive, civil society organisations, rent seeking political elites and development partners which can build the capacity of state actors.

Despite capital investments in the city’s infrastructure, Nairobi city systems – namely, transport, education, healthcare, water and sanitation – have been adversely affected by a number of factors. The gap between demand and supply in service delivery is widening; institutional fragmentation is increasing, fostering competition or duplication of roles across national and county government levels; and there is a proliferation of informal service providers, who offer costly and often hazardous services, especially in informal urban settlements. These have resulted in glaring gaps in service delivery and, subsequently, overreliance on private sector and developmental agencies in meeting basic needs for Nairobi’s residents.

Identifying priority complex problems to catalyse urban reform

Further to analysing Nairobi’s political systems, ACRC engaged in domain analysis, to explore city programming and policy frameworks in four of ACRC’s eight thematic areas: health, wellbeing and nutrition (HWN), housing, structural transformation, and safety and security. Research from these urban development domains yielded a total of ten priority complex problems (PCPs), identified as areas having clear potential to catalyse urban reforms in the city.

Based on insights from politically informed systems analysis and emerging evidence, stakeholders across multiple sectors engaged in Nairobi proposed a number of actionable pathways as entry points for initiating small pockets of urban reforms in the city.

Safety and security

For safety and security, the PCP focused on addressing the safety concerns of children in increasingly volatile areas. Stakeholders proposed broadening the PCP to encompass protection, reclaiming, rehabilitation and recreation of public spaces to make child-friendly playground and recreational spaces. This would include the rehabilitation of riparian land and renovation of social halls, amongst other avenues that are part of ongoing efforts with traction in the county government priorities.

Stakeholders also reiterated the need to champion ongoing efforts on street lighting by the Mobility and Works Department. Provision of street lighting in the city has the potential for multiplier effects in several frontiers of addressing security in the city.

Proposed interventions for this domain would make modest contributions to poverty reduction, improved living conditions, concerted efforts to address climate change, and increasing life chances for city residents from disadvantaged communities.

Presentation on the proposed implementation plan for a school feeding programme in Nairobi.

Housing

For housing, evidence from ACRC will directly inform formulation of the Nairobi City metropolitan housing policy and updating the national housing policy that is currently under review. Stakeholders proposed the establishment of a housing research lab as part of a long-term solution to addressing the needs of renters in the housing sector, while promoting sustainable housing models that would meet occupational needs, safety standards and climate adaption thresholds for residents. The housing interventions are geared at improving the living conditions of city dwellers.

Structural transformation

Structural transformation, on the other hand, focused on how to embrace informality, especially when it comes to unregistered service providers (cartels). Formulation of an enabling trade policy and collaborations with the county’s hawker strategy committee as an informal reform coalition were cited as possible strategic pathways to address this challenge.

Curating and disseminating evidence to accelerate reforms

Overall, evidence and proposed interventions from ACRC were key in the county climate change plan, particularly the multisectoral county climate action plan that looked to coalesce efforts from various sectors through interventions that mitigate, build resilience and foster adaption for climate change.

The county research department proposed to curate evidence from ACRC in its digital library, for future reference and collaborations. To harness the power of communities, there is need for the ACRC research uptake team to increase avenues of dissemination of evidence from ACRC research and to raise awareness of local communities about ongoing government projects, so that they can push for reforms and demand accountability from the county government. Even as ACRC cities await a decision on progression to the action research phase, a number of interventions proposed from ACRC research are being implemented in Nairobi, with potential for accelerating reform in the city.

Download the report below for a more in-depth summary of the discussions and outcomes from the workshop.

Photo credits: Know Your City TV

Note: This article presents the views of the author featured and does not necessarily represent the views of the African Cities Research Consortium as a whole.

The African Cities blog is licensed under Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 International (CC BY-NC-ND 4.0), which means you are welcome to repost this content as long as you provide full credit and a link to this original post.