The Place Of Tech In Improving Housing Delivery In Africa
Urbanization Of Poverty
The UN defines urbanization as the course of the shift in population from a rural to a more urban civilization. Numerically expressed, urbanization denotes the increases in the share of the population that resides in urban areas; predominantly because of net rural to urban migration (UNFPA, 2007).
African cities are expanding rapidly. The United Nations predicts that Africa will overtake Asia as the world’s most rapidly urbanizing region by 2025 (UN 2014).
In the coming 20 years, the total population of the continent will exceed the combined populations of Europe and the Americas.
By 2050, Nigeria alone will contribute nearly 10 percent of the world’s total population growth.
However, between 1993 and 2002, the share of the urban population earning less than a dollar a day was increasing at a rate of 0.6% per year; while the rate of urbanization as a whole was rising by 0.5% per year (Ravallion, et al. 2007). This signifies that poverty is gaining more grounds into urban areas and that the poor flocking to the cities are outpacing the urbanization rate of the population as a whole.
Situations in the rural parts of Africa have become so dire that so many flee to the cities in search of a better life. Unfortunately, tough realities unlike anything they expected await them. They are mostly unable to find jobs, can’t afford the urban life and find themselves in worse conditions than before they moved, ultimately facing like so many before them, the “Urban Illusion” (Eyong & Foy, 2006).
The current urbanization unlike the past where it mostly occurred in countries with high per capita income is now sweeping predominantly over low-income countries and in the case of Africa has almost become disassociated from economic growth (World Bank, 2011).
- Housing construction is a major source of employment worldwide. It also generates jobs in many other locally-based ancillary industries such as furniture, equipment, and supplies.It is estimated that in developing countries the multiplier generated by housing construction is 1.0, meaning that for every money spent on housing, an equivalent is spent in other sectors. Studies have also shown that improved shelter can provide increased opportunities for home-based income-earning activities (Stephen Giddings, 2007).
- Housing construction is not only a driver of economic growth but also improved housing and urban infrastructure can have major impacts on health conditions in urban areas. People living in sub-standard housing in slum areas and informal settlements are subject to much higher incidences of infectious and environmental diseases.
- Improved housing can play a constructive role in the strengthening and spread of community, civic and democratic values which in turn enhance social stability and personal security.
- Also, once a housing market becomes more formalized and subject to real estate taxes and utility charges, housing can serve as an important source of revenue for the government.
It is therefore imperative that the role of housing in promoting economic and social development, improving health and strengthening of democratic institutions and values be understood by decision-makers and the political leadership.
A very serious policy constraint to scaling up investments in housing and urban infrastructure in Africa is that most African countries have not accorded it the priority it should command in national planning strategies. It thus receives short shrift in attracting budgetary resources.
The national governments also haven’t taken a comprehensive approach to deal with access to land, infrastructure, finance, legal systems etc.
- Most African countries face serious human and institutional capacity shortages in dealing with the rapid pace of urbanization and the growth of slums and informal settlements. The public sector in most African countries also lacks the capacity to generate data required to track key indicators of urban performance over time, data needed to support sound policy decisions. The legal and regulatory environments in many African countries remain ill-suited to address the new urban realities…Thus, a sound macroeconomic environment supported by appropriate fiscal and monetary policies holds the key to unleashing private sector capital and know-how for housing and urban infrastructure (Stephen Giddings, 2007).
- The unavailability of reasonably-priced and well-located serviced land has also been cited as a major constraint to the rapid expansion of housing for low and moderate-income families.
- Another major constraint is lack of financing and an effective means to provide basic infrastructure to potentially well-located sites, to create serviced sites for housing construction and to upgrade slum areas. This includes roads, water supply, sewerage, and electricity.
- Increasing construction costs is also another constraint to providing affordable housing. Causes include a reluctance to use innovative techniques, high level of importation, a cultural aversion to materials deemed as “cheap” and the unavailability and the high cost of construction finance.
On February 2010, in a conference on the future of cities in London, United Nation’s head of housing agency Anna Tibaijuka proclaimed that “After HIV and Aids, the biggest threat to sustainable development in Africa is rapid and chaotic urbanization, because it is a recipe for disaster for increased tensions and pressure” (MacLellan, 2010).
We have seen that more people migrate to the city than the city can sustainably carry. But, the policy/decision-makers are yet to realize the full potential of housing as an entity for socio-economic growth. However, there are some constraints beyond the government, that hinder formal housing provision…
The outcome of all these is a situation where informal housing solutions serve as the primary means of addressing the housing challenges. In many of Africa’s cities and towns, less than 10% of the population lives in formal sector housing. For example, in Zambia, 74% of urban dwellers live in slums; in Nigeria, 80%; in Sudan, 85.7%; in Tanzania, 92.1%; in Madagascar 92.9%; and in Ethiopia, a staggering 99.4%. The Kibera slum in Nairobi has more than half a million people packed into 225 hectares… (Stephen Giddings, 2007).
The consequences are substandard houses, lacking in infrastructure and social amenities — generating no revenue for the government, as most of the activities operate outside of the law.
- Thus, the reality is that in the industry, the majority of the construction activities are disintegrated, without a functional value and supply chain — with a generally negative impact on the environment.
- Because the government cannot account for these activities, there is not enough data to evaluate the occupancy needs of the city-dwellers. Without adequate data, there is no way the government can make informed policies to address the housing challenges.
Even though the current circumstances prove otherwise, the inevitable outcome of rapid urbanization in Africa does not have to be a profound number of unemployed citizens in need of low-income houses in the absence of any; and thus facing housing shortage, and turning to the informal sector for survival, and ending up in slums and squatter settlements (Wondimu Robi, 2011).
According to the growth model proposed by Wondimu Robi (2011), the following are potential benefits that could be reaped from the rapid urbanization in African cities:
- Rapid urbanization injects a fresh labor force into the economy allowing for the division of labor and specialization thus enabling economies of scale to result. This, in turn, promotes innovation and economic growth.
- The increase in demand for housing as a result of the rapid urbanization can stimulate a construction boom which would result in enabling the benefits of backward and forward linkages in the form of increased income as well as employment in the country. Moreover, the resulting increase in the supply of housing would lower the price of houses and would help attract skilled labor and investment prospects into the country.
- The growth of the construction sector would avail those dependent on the informal sector better living as well as employment options thus reducing the informal sector.
- The government would be able to collect increased tax revenue from the decline of the informal sector as the revenue gained from employment in this sector is never truly accounted for and thus does not contribute to the gross national product of the country.
- Another untapped opportunity is the use of local goods and natural resources by the housing sector as opposed to lavish imports. This can play a great role in directing this capital spending into producing a greater domestic multiplier.
THE PLACE OF PPP (PUBLIC-PRIVATE PARTNERSHIP)
A Holistic Approach
The term holistic is derived from the word ‘holism’ as first coined by Jan Smuts in the year 1926 explaining that it is hard to give meaning to parts or components of a system without the context of the whole picture (Freeman, 2005).
The holistic approach in much the same way can be applied as a method for finding a solution by looking at the whole picture and trying to find answers which are otherwise impossible to see in isolation when looking at the individual components.
By means of a holistic approach, a “give and take” tactic can be adapted in which the government avails the private sectors with the resources they need. Be it in the form of subsidized planned and serviced land for development in favorable locations inside the city; a good infrastructure; a subsidy in the construction sector; practical building codes and standards rather than ones that require unnecessary investment etc.
In return, the private sector can be required to partake in the construction for low-income residents alongside luxurious properties.
The holistic approach in this sense would help eliminate the possibility of segregation of the city that would arise if the government’s housing development solely focused on providing housing for the poor while encouraging the private sector to supply high-income housing.
The private sector’s motivation to take part in a holistic approach would surface from the increased profit it will be able to gain since it would be able to offer its high paying customers residential properties that are in favorable locations of the city; have the important social necessities like school, hospitals and good infrastructure; and would thus attract more clients.
Thus, the government would have an opportunity to revitalize the vision of the city and integrate the private sector into bringing more prosperity for the people through new policies in the housing sector (Wondimu Robi, 2011).