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Millennium cities: an interview with Jeffrey Sachs.

By 2030, the number of people living in slums will double to two billion. Yet poverty is only one of the challenges faced by developing countries experiencing rapid urbanization; they also face the loss of arable land, pollution and the environmental hazards of climate change. World-renowned economist Jeffrey Sachs has sought to address these problems through the Millennium Cities Initiative of the Earth Institute at Columbia University. Similar to the Millennium Villages Project, the Millennium Cities Initiative assists select sub-Saharan African cities in achieving the Millennium Development Goals, which aim to eliminate extreme poverty by 2015. In an interview with the Journal's Rebecca Chao, Sachs discusses the many facets of urban growth in developing countries. (1)

Journal of International Affairs: Based on your experience working on separate millennium development initiatives for both rural villages and cities, how are rural and urban challenges distinct?

Jeffrey Sachs: In rural areas, the challenges are to extend basic services-healthcare, education, electricity--and to raise agricultural productivity, since agriculture is the primary vocation of rural dwellers. The upside of working in rural areas is that you have a really good sense of the challenges, which are usually to help impoverished, small-land-holding subsistence farmers become part of the commercial economy. These farmers and their families can experience big increases in levels of income, health, access to education and health services when given basic technologies and organizational assistance to establish farmer-based cooperatives, which helps them become part of regional, national and international supply chains. This is happening in the Millennium Villages with a big added push from information technology, especially phones and mobile broadband. We are seeing a very exciting upgrade in rural life in many places, though not everywhere, as mobile banking, for example, comes onto the scene.

Now when it comes to cities, the challenges are much more complicated because there is no single economic base in a city. The definition of almost any urban economy is that it is a diversified set of manufacturing and service sectors. So in the Millennium cities, the challenge isn't a relatively straightforward question of upgrading agriculture as it might be in the villages. On the other hand, by virtue of the density of an urban setting, reaching people with public services, whether it is access to healthcare, education, power or water, is in principle an easier challenge, because you don't face the big problems of distance and low population density, which can make access to services very costly.

So my view is that the biggest challenge in urban areas is creating a thriving private sector economy supported by improved public infrastructure. The economic challenges are quite complicated for these regional cities in the Millennium initiative because they are not capital cities or ports, and so they don't have an easy answer to the question, "What should we be doing here to earn our livelihoods?" The starting point for a lot of these Millennium Cities is, therefore, a huge amount of poverty, informality and a shortfall of basic services because local budgets are so weak.

Another operational difference is that in the Millennium Villages Project, when we are dealing with a rural area of thirty or fifty thousand people, we bring our own money and also philanthropic money to support the project. When we are dealing with cities with populations of 250,000, a million or many millions, we don't have the means to make the same investment at that scale. That project becomes much more advisory in nature, rather than directly financing or supporting a service provision.

Journal: Do the Millennium Villages and Cities projects impact or interact with each other and if so, in what ways?

Sachs: Of course the idea for these regional cities--and one of their main economic purposes--is to provide administrative, transport, storage and financial services for the agricultural hinterland. In other words, regional cities like Kumasi in Ghana or Kisumu in western Kenya are, to an important extent, part of a division of labor of bringing rural goods and services to the national economy and even to the international economy. Since we don't directly invest in the cities ourselves, our role is to guide investors into the cities. We've done a number of investment and business-environment guidepost training sessions on attracting investment and so forth, but it is very much around the theme of linking the urban and rural areas. Of course in every other part of economic life, like the health sector, for example, the city will typically be where the hospitals are, and villages will be where the clinics and the community health workers are, and so one needs a referral system, one needs ambulance linkage and so forth. One of the challenges of the Millennium projects is making these linkages.

Journal: With the rapid rate of urbanization in developing countries--80 percent of urban dwellers will live in developing countries by 2030--do you see a larger role in the future for the Millennium Cities Initiative than for the Millennium Villages Project?

Sachs: In general, I see a huge role for the Earth Institute in trying to better understand how to support sustainable cities. There is a tremendous amount of informality in cities in developing countries as they deal with massive population growth and climate change, as well as other environmental risks like pollution. They are overrun by the inflow of people fleeing rural poverty, and internal growth from high birthrates. Compounding this is an increasing rate of pollution from traffic in cities that are growing very rapidly, about 5 percent a year, which means that they double in size every fourteen years. These cities don't have plans, they don't have strategies, they don't have zoning and they don't have the economic foundations that can support these challenges.

At the Earth Institute we are increasingly engaged in thinking about urban strategies--transport, climate-change resilience, economic development, infrastructure investment and so forth. I think it is a huge, fascinating and very important challenge, and I think it will lead to a new generation of urban planning. One of the projects that we have underway--in the United States, actually--is at Babcock Ranch in western Florida near Fort Myers. Babcock is a new development for about fifty to one hundred thousand residents that will be built green from the start. So how do you create a sustainable city if you are designing it from scratch? We are working with the project developers on self-driving vehicles, for example, and on creating a basic power supply from a 75-megawatt solar-power unit. In this project, we are really trying to understand what sustainable cities can mean in the actual design and implementation of a new, undeveloped space.

Journal: In developing countries, what role or level of responsibility does the state have in the growth and sustainability of its cities?

Sachs: There is a doctrine that I really like called "subsidiarity," which means that you try to push responsibility, authority and financing to the lowest level of government at which they can be handled. At the village level, responsibilities might include handling community-based organizations like schools or clinics. At the city level, it may be hospital services, local roads and district-level governance. A large-scale power grid, highways and rail systems are national responsibilities. think one of the biggest challenges is figuring out how to make institutions, tax structures and collaborative structures that still allow authority and entrepreneurship at the local and city level while keeping the state responsible for national public goods.

We know that in the United States, with our federal system, this doesn't work all that well in terms of balancing taxes and responsibilities. One of the strengths of the United States is that our cities, to a large extent, are self-governing and even self-financing with local property taxation. This has led to a lot of dynamism compared to highly unitary states where everything comes through a central government, including the appointment of local district or municipal leaders. But this challenge of creating a suitable system--whether of federalism or decentralization--that allows for a balance of responsibilities is very hard and often not very successful.

Journal: The Economist's Johnny Grimond once said the following about cities: "One of the striking things about slums is that many people there are really quite cheerful. It is a tribute to the human spirit that, even in the face of considerable adversity, so many people get on with their lives and organize themselves in an extraordinarily impressive way." Based on your experience with the Millennium Cities project, do you see striking cultural differences between the rural and urban poor?

Sachs: I would say that there is a lot of social capital in both rural and urban areas. One thing that we can count on everywhere is the engagement of people in their own communities. This has been one of the enduring and highly successful features of both the Millennium Villages and Cities projects. There is a lot of energy at the local level and tapping it is extremely important. Civil society is extremely important. Outside of the business and government sectors, there is a community sector that can and must necessarily provide a lot of the public goods for the community, and that's the exciting part of all of this. Interconnecting civil society, government and business across all scalcs, from the local to the global is, of course, the open and unsolved challenge of our world todav.


(1) This conversation took place by phone on 17 Februarv 2012. The imerview is a condensed and edited version of the exchange.
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Author:Chao, Rebecca
Publication:Journal of International Affairs
Article Type:Interview
Geographic Code:1USA
Date:Mar 22, 2012
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