Urban Development

Urban Development
Updated: 22 January 2010

With urban population expanding rapidly over the last 50 years, many Asian cities face deteriorating urban infrastructure and services on water supply, sanitation, waste management, and transport; and worsening environmental conditions. ADB recognizes that urban issues require integrated approaches that specifically target the poor, promote economic development, treat cities as a living ecosystem, foster the involvement of private sector and civil society, and adopt measures to mitigate and adapt to climate change impacts of urbanization.

ADB has been active in Asia and the Pacific's urban sector since the 1960s. However, while lending for the urban sector has increased over the decades, enormous funding gaps remain. For instance, while Asia's urban population has grown 15% in the past decade compared to the previous one, lending to the urban sector increased by less than half this amount during the same period. Fortunately, ADB's Long-Term Strategic Framework 2008-2020 (Strategy 2020) provides a blueprint for responding efficiently and effectively. And the strong future pipeline indicates that there is a growing appetite for urban sector investments, both for Asia's mega-cities and emerging new towns.

Asia's Urban Challenge

Another 1.1 billion people will live in Asian cities in the next 20 years, and over 200 million people will live in poverty and many more are vulnerable to economic and environmental shocks. With this growth, pressing problems of pollution, lack of potable water, slums, traffic congestion, among others, will become critical – with global implications. Though cities on average provide 80% of the economic base of the economy, large disparities have emerged as poverty has urbanized. Managing cities in this context requires a new approach.

The challenges for ADB have been to build on and boost the impact of the individual projects that embody the objectives set out in the Strategy 2020. ADB recognizes substantial needs to increase both the quantity and quality of its urban lending by leveraging cofinancing under longer-term programmatic interventions, bolstering urban sector knowledge, improving the quality of sector analysis, and supporting urban networking and outreach.