Urbanisation key to future growth prospects—WB

World Bank says Malawi needs to manage its urbanisation process as this will be critical in the country’s efforts to boost resilience, reduce poverty, and achieve sustainable, inclusive growth.

In its fifth edition of the Malawi Economic Monitor (MEM) titled Harnessing the Urban Economy released on Friday, the bank says Malawi is still at an early stage of urbanisation and the slow urban transformation rate well-positions the country to formulate plans to maximise the benefits of urban agglomeration into the future.

However, the bank cautions that a more rapid rate of urbanisation might result in urbanisation of poverty.

The Bretton Wood institution urges that more public resources should be allocated to meet investment needs in urban areas, and capacities of local governments strengthened to manage increased urbanisation rates.

“In Malawi, policymakers have tended to be wary of urbanisation and of its potentially adverse impacts, including the urbanization of poverty. Malawi is predominantly rural, so naturally, national development policies have focused on the development of rural areas.

However, contrary to common perceptions, Malawi is still at an early stage of urbanisation and is urbanising at only a moderate rate,” reads the report in part.

Available statistics from the bank indicate that in 2008, only 15.6 percent of Malawi’s 14.5 million population—2.8 million people—lived in urban areas while in the period from 1998 to 2008, the annual urbanisation rate averaged at around 3.7 to 3.9 percent, a lower rate than that recorded by many other African countries.

In a recent interview, the Minister of Lands, Housing and Urban Development Atupele Muluzi said his ministry has set up a new department of urban development which is going to provide leadership in urbanisation and urban development matters.

According to the 2016 African Economic Outlook report, Malawi’s major challenge to meeting urbanisation is how to meet demand for housing and their basic services despite limited resources.

“The country is one of the least urbanised in the region, but the 3.8 percent urban growth rate is higher than the overall population growth rate at 2.8 percent. However, urbanisation presents an opportunity if its potential to transform the economy can be harnessed,” the report reads.

The bank has since suggested that a systematic effort should be made to improve revenues of city councils from their own sources with emphasis on property tax, and better management of resources and services. n