Sustainable urban development in South Africa makes for a better economic climate

Project completed
A group of people sit at a table with a model of a city made out of coloured building blocks. One man has a microphone and is ex-plaining something about the model.
The World Bank and SECO train decision-makers to develop cities in South Africa that are more inclusive and sustainable. © SECO

Cities account for 70% of global economic output and are, accordingly, of critical importance in the development of individual countries. Thus, in South Africa, SECO is working together with the World Bank to support the 'Cities Support Program'. The programme helps eight city councils organise their cities to become more inclusive, sustainable and productive.

Country/region Topic Period Budget
South Africa
Economic and financial policy
Private sector and entrepreneurship
Urban infrastructure and utilities
01.08.2015 - 31.07.2019
CHF 10'300'000

Urban development is vital to a country’s economy: if development is going well, the city as a business location attracts companies. This leads to investment in better infrastructure, in turn making the location more attractive and benefiting the population. The South African government’s Cities Support Program is supporting this upward spiral in its eight largest cities, where it specifically promotes sustainable and inclusive urban growth.

Since the end of apartheid, the South African cities have experienced tremendous population growth. Initially, this was accompanied by an economic upturn that drove urban development. This seldom took an organised form, with the result that spatial segregation now poses a major problem. Poorer people live mostly in settlements that barely have any access to the city's water supply and sewerage system, and are often some considerable distance from where they work.

The Cities Support Program is addressing these problems in eight of South Africa’s largest cities. The program is organised locally by the South African Intergovernmental Relations, National Treasury. The World Bank and SECO make a financial contribution and support the program with their expertise.

Organised urban development through training and interdisciplinary teams

All too often, the urban development of South Africa’s cities is not well enough organised. This is the result of uncoordinated administrative procedures: in general, responsibilities are not clearly defined and it is almost impossible to control the budget. The objectives of efficient planning and budgetary processes are: 

  • inclusive growth and poverty reduction;

  • basic services that are equally accessible to citizens and business;

  • organisation of the city that brings employees and employers as close together as possible, enabling public transport to be organised in an economically and ecologically meaningful way. 

The Cities Support Program offers training for municipal employees with a view to achieving these goals. In future, administrative and political decision-makers will be able to organise their cities in a more sustainable way, thanks to the expertise provided by the World Bank in particular. Examples of this include locating companies in specially selected urban districts and the interdisciplinary planning of public services by different departments.

Budgetary transparency is another priority: thanks to the program, the cities publish details of their financial management on a website that is open to the public. This helps bring about transparent and well-organised financial planning in the cities. 

Informed decision-making for an inclusive society 

The program is managed nationally to enable the whole country to benefit from solutions identified mainly in an urban environment. Specifically, the Intergovernmental Relations, National Treasury conducts in-depth data analyses, whose findings are examined with the aim of achieving progress in the management of urban development. The data that had been analysed by spring 2018 chiefly concerns the following areas: 

  • Transport

  • The property market

  • The effects of urbanisation

  • City finances 

These analyses are expected to help create conditions at national level that foster a good economic climate. The program focuses primarily on small and medium-sized enterprises that generate jobs and reduce poverty in the cities. One proposal to emerge from these analyses is the introduction of an electronic payment system facilitating transfers between companies and councils. Changes of this kind make South Africa more attractive as a business location and encourage companies to invest in its cities. Well-organised services enable the population to benefit from this.