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close this bookThe Human Settlements Conditions of the World's Urban Poor (HABITAT, 1996, 233 p.)
close this folderVII. Agenda for future work
View the document(introduction...)
View the documentA. Countering urban poverty
View the documentB. Shelter, good governance and the enabling role
View the documentC. Specific policy areas in need of development
View the documentD. Strengthening shelter strategies for the poorest groups
View the documentE. Harnessing the benefits of research
View the documentF. The future role of local authorities
View the documentG. The role of CBOs and NGOs
View the documentH. The role of the private commercial sector

H. The role of the private commercial sector

The enabling approach to urban administration envisaged by international agencies sees a broader role for the private sector and indeed the privatization of some functions previously the responsibility of government bodies. Since the main concern of the commercial sector is profitability, it is not immediately apparent that this will improve circumstances for the poorest groups. It must be remembered, however, that these groups are often already dependent on the private sector for a number of urban services. Renting from a private landlord, for example, is very common amongst low-income groups; water may be purchased from vendors if a public supply is not available; and urban forms of transport are often also privately owned.

The increasing emphasis on the private sector, however, implies that in seeking to improve or enhance provision for the urban poor, whether it be in terms of the availability of land for development, the provision of shelter, or improvements in infrastructure and urban services, local authorities will increasingly have to seek solutions which draw on the resources of the private commercial sector. The implication of this is increasing dialogue between the sectors over issues of urban management and service delivery. Already in many developing countries, often as a consequence of SAPs, there are discussions of this kind over the delivery of basic services such as water-resource management and solid-waste disposal. One would expect this kind of dialogue, or joint working, to extend to issues such as the availability of land for development in order to seek to resolve current difficulties over land scarcity and the absence of land for the urban poor. The development of local shelter strategies is likely to involve similar types of discussions between local authorities and housing developers, land holders, landlords, financiers, and others, in an attempt to examine potential partnership solutions to improvements in shelter provision.

One area in which the private commercial sector has been active for some time is in seeking to extend credit facilities to low-income groups for shelter development and upgrading. Although these developments are tentative at present (see section VI. F), they are likely to become more important in future.

A further area of activity in which the involvement of the private commercial sector is likely to be much more actively sought in the future is in the field of local economic development as part of poverty alleviation strategies. Advice and guidance from the private sector is likely to be increasingly needed in the area of SSE and HBE development (and encouragement). Private sector expertise is also likely to be necessary in developing training programmes in relation to local labour needs and developing local enterprise strategies (UNCHS/ILO, 1995).