Business

Urbanisation key to economic growth

TRYNESS TEMBO, Lusaka
URBANISATION is a mega-trend with profound implication for Zambia and Africa’s growth and transformation.
If well managed, urbanisation can support industrialisation, sustained economic growth and improved productivity, among others.

The rate and scale o f urbanisation is reshaping not only the demographic profile of the continent but also its economic, environmental and social outcomes.

Urban transition is taking place as the continent faces a demographic shift, with a burgeoning youth population in urban areas.
According to the 2010 census, 39 percent of Zambia’s population of 13 million resided in urban areas, an increase of almost five percent since 2000. And the rapid pace of urbanisation in Lusaka is a reflection of what is obtaining countrywide.
In this vein, the United Nations Economic Commission for Africa (UNECA) launched the economic report on Africa 2017 under the theme ‘Urbanisation and industrialisation for Africa’s transformation’.
UNECA has called on African countries to take advantage of the rapid urbanisation trends to invest in industrialisation to meet the growing demand for goods and services.
The commi s s ion has projected that by 2035, half of Africa’s population would be living in urban areas, presenting considerable demand for employment, services and infrastructure, as well as creating advantages for economic growth.
UNECA director for southern Africa Saud Adejumobi notes the need to reconnect urban and industrial development in Africa through deliberate policies, strategies and investments, as this is a priority for the sustainability of both cities and industries.
This is the reason; there is need for cities to improve the performance of the industrials in light of the rising population.
“Based on these priorities, the report provides a strategic policy framework anchored in national development planning to enable African countries to harness urbanisation for industrialisation,” Mr Adejumobi observes.
He cites some of the key policy anchors as domestic manufacturing that helps to foster value addition, industrial plan to factor in ways urban functionality can support firms, and integrating industrialisation and regional policies.
Of the four key policy anchors, there can be accelerated growth through better leverage urbanisation in African countries, including Zambia.
It is from this background that the report seeks to connect the two most impor tant aspects of urbanisation and industrialisation as well as tries to debunk the myth that urbanisation may be detrimental to industrialisation.
The report suggests that if well harnessed, urbanisation could be the locomotive for development.
This is the conviction of the ECA that industrialisation is the pathway to Africa’s economic transformation.
“ECA is also convinced that a resource-based industrialisation process may be the best strategy, as Africa has abundance of natural resources, including expansive arable land, minerals and metals.
“Hence, the issue of agro-based industrialisation, beneficiation and value addition in the mineral sector are essential for Africa’s economic transformation,” Mr Adejumobi said.
But it is important to note that urbanisation comes with costs as well as opportunities. The costs involve pressures on social infrastructure of health care, water, sanitation, education, housing and employment.
On the other side of the coin, urbanisation brings out opportunities that lies both in the creation of a larger concentrated market and band of workforce that could be the life-wire of an industrialisation process.
Therefore, for urbanisation to be connected to industrialisation, state policy and presence is inevitable.
“A viable industrial policy that identifies and taps into urban resources with strategic urban planning are central in making urbanisation work for industrialisation,” Mr Adejumobi advises.
For countries that are commodity – d r i v e n l ike Zambia, it is imperative that value addition to minerals does not preclude investments in science, research, technology and innovation necessary for driving not only resource-based industrialisation but technology-driven one as well.
The urbanisation rate in sub- Saharan Africa has grown from 15 percent in 1960 to 38 percent presently, far higher than that of south Asia, which is next in line.
Africa’s urban population is projected to triple by 2050, when most of the population would be living in cities and towns.
In comparison, urban population growth varies by regional set-up and various factors. While east Africa, which is the least urbanised currently has the fastest growth rate, Southern Africa, which is the most urbanised records a slower growth pattern.
Commenting on the report, Minis ter of Commerce, Trade and Industry Margaret M w a n a k a t w e s a i d t h e findings will help Zambia and governments in Africa in addressing the continent’s development challenges.
Mrs Mwanakatwe also said the report will help provide timely policy recommendations to implement development agenda.
“I am especially, pleased to state that this publication helps Governments in Africa, including ours, to identify, design, develop and implement effective policies, strategies and initiatives to address our rich continent’s developmental challenges,” she said.
Government is very much alive that industrialisation provides the opportunity to create deeper forward and backward linkages throughout the economy, thereby promoting broad-based and inclusive growth.
For Ministry of National Development Planning permanent secretary Auxilia Ponga, the report addresses industrialisation from different angles and is vital in driving Zambia’s national urbanisation report.
“The report for us is timely, given that we are at the validation study on integration of urbanisation in national,” Dr Ponga said.
Zambia, like many other countries, is experiencing rapid urbanisation, and this phenomenon would continue to pose more challenges in terms of unplanned settlements, pressure on service delivery and infrastructure gaps, among others.
While Zambia is making strides in tackling industrialisation woes, there is need to incorporate planning and urbanisation in the national development framework and link the two to the overall targets of growth and economic diversification

 

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