Enhanced Framework of Implementation for Sustainable Urbanisation in Asia-Pacific

I. Overview

1. Rapid economic growth is one of the most striking features of Asian development. The impact of economic growth is vividly manifested in contemporary urban development in Asia. Today in many parts of Asia and the Pacific, urbanisation is being accelerated by a new global economy that is literally changing the face of the continent. Though there is a continuing strong progress towards the reduction of income poverty, performance against many social indicators in Asia is mixed. Asia has to confront the reality that more than two-thirds of the world’s poor live in Asia, and that the benefits of strong economic growth are not shared equally. In the Asia-Pacific region alone, more than 650 million people live on one dollar-a-day or less. This accounts for 65% of the world’s ultra-poor. Asia also is home to half the world’s slum population. And despite economic growth and the contribution of cities in this growth, the slum population is rising.
2. With half of humanity living in towns and cities, the world has now entered a new urban era. Cities create much of the pollution that causes climate change. The urban poor are particularly vulnerable to disasters. This makes many cities giant disaster traps. New thinking is needed so that countries in the Asia-Pacific region regard and treat their cities as living eco-systems.
3. These concerns have been raised at the national, regional and international levels to improve the lives of people in cities and towns. Against this background:
   • The 1994 Cairo International Conference on Population and Development (ICPD) recognised that “The process of urbanisation is intrinsic to economic and social development …” and recommended “… to foster a more balanced distribution of population by promoting sustainable development in both major sending and receiving areas.” The ICPD clearly underlined that “Such development should be ecologically sound and promote economic, social and gender equity”.
   • In 1996 the UN-HABITAT Summit in Istanbul and the 2001 Istanbul + 5 review Summit called on Governments to take the measures necessary to ensure adequate housing for all, alleviate urban poverty and promote overall social development.
   • The Heads of State and Government, in September 2000, in New York committed themselves to the Millennium Declaration. It provides an integrated development framework. Goal 7 covering Environmental sustainability addresses the challenge of housing and urban development. Within a wider framework of social and economic interventions, it seeks the “improvement of the lives of slum dwellers” implying access to safe water, sanitation, security of tenure, durability of housing, and sufficient living area as well as social services such as health and education.
   • Specifically, Target 10 of the Millennium Development Goal No. 7 urges UN Member States to “Halve by 2015 the proportion of people without sustainable access to safe drinking water and basic sanitation”. Target 11 aims to “Have achieved by 2020 a significant improvement in the lives of at least 100 million slum dwellers.”
   • Further, at the World Summit in 2005, world leaders agreed to the following: “In pursuance of our commitment to achieve sustainable development, we further resolve: 56 (m): To achieve significant improvement in the lives of at least 100 million slum-dwellers by 2020, recognizing the urgent need for the provision of increased resources for affordable housing and housing-related infrastructure, prioritizing slum prevention and slum upgrading, and to encourage support for the United Nations Habitat and Human Settlements Foundation and its Slum Upgrading Facility;”
4. These international responses to the challenges posed by rapid economic growth and urbanisation, coupled with a large proportion of population living in slums, called for joint collaboration between the UN-HABITAT and the Government of India to organize the First Asia Pacific Ministerial Conference of Housing and Urban Development (APMCHUD) under the theme, “A Vision for Sustainable Urbanisation in the Asia-Pacific by 2020”.
5. The Conference strongly endorsed the vision of achieving Sustainable Urbanisation by 2020 in the region. The deliberations and recommendations have resulted in the development of this enhanced framework for the implementation of programmes for achieving this vision in Asia and the Pacific.

While it was seen as important to agree on general principles and concepts. There is a need for individual countries to consider the recommendations made by the Conference based on each country’s particular context related to scale of population, level of urbanisation, level of prosperity, environmental situation, political and administrative arrangements and level of development. Considering the diversity in this vast region, including small island nations, each country may have to evolve and adopt specific practices and policies adapted to their unique local context.

The Conference welcomed the comprehensive approach towards integrated and sustainable rural and urban development, as outlined by H.E. Dr. APJ Abdul Kalam, President of the Republic of India, in his address during the inauguration of the Conference. This approach is also reflected in the recommendations of this enhanced framework.

II. Urbanisation challenges and opportunities

1. The urbanisation level in Asia will increase from about 40 percent today to about 60 percent in the next two decades. Nearly 90 percent of the population growth will be absorbed in the urban centres of Asia.
2. While economic growth in Asia has progressed well, and made it much richer than ever before, this growth is contingent upon the way in which Asian cities are managed, and how the urban poor are cared for. The current growth pattern has also brought about enormous disparities across and within nations. Asia must face up to the fact that more than two-thirds of the world’s poor live in the region, and that the benefits of strong economic growth are not shared equally. In the Asia-Pacific region alone, more than 650 million people live on one dollar-a-day or less. This accounts for 65% of the world’s ultra-poor.
3. Along with the prosperity that globalisation brings to Asian urban economies, there are associated problems of poor infrastructure, lack of basic services, increasing pollution, and growing numbers of poor people. It is feared that the rapid economic growth will bring about a worsening of environmental indicators, with more air pollution, and less groundwater availability.
4. Notwithstanding the above, urbanisation can be a positive development process if well managed and controlled with equitable access to land, adequate shelter as well as the provision of basic services. Political will, decentralisation, good governance and the empowerment of national and local authorities as well as the adoption of inclusive processes for mobilising local resources and judicious resource-allocation and decision making are fundamental to addressing the urbanisation challenge in Asia and the Pacific. In a rapidly urbanising region, the promotion of balanced and sustainable urbanisation requires, more than ever, strategic, integrated planning, capacity building, as well as strong regional co-operation, knowledge sharing, networking and monitoring.
5. The framework aims to identify and suggest measures for more effective urban development policies and strategies in Asia-Pacific so as to guide the actions of all stakeholders (government and non-government) and help steer them towards the achievement of the common urban vision. The framework also aims to identify linkages between land policies and urbanisation.

III. Pro-poor urban governance and planning

1. The key challenge is improving urban governance and management through an enhanced local investment climate that promotes economic growth and increases employment.
2. To redress the most rapid urbanisation in the world, sustain high economic growth, eradicating poverty and inequity, requires reinvigorating urban planning, working with the private sector, embedding a pro-poor policy orientation, inclusiveness and empowerment.
3. It is necessary to seek rapidly responsive and sustainable modalities of providing shelter, infrastructure services and means of livelihood. It is also necessary to enhance the role of city and community leadership, ensure civic involvement and private sector engagement.
4. These principles will be realised through effective decentralisation policies and mechanisms that streamline inter-governmental relations, strategic integrated planning harnessing a full engagement of stakeholders and forging realistic public- private-people partnerships.
5. Enhancing local investment climate will require systems and institutional mechanisms that nurture a partnership between public, private and civil sectors in service delivery, infrastructural development, as well as in producing means of livelihood. Similarly, the regulatory and oversight frameworks, which allow the private and community sectors to generate means of livelihood will have to be attended to and realigned. The capacity of city administrators will need to be enhanced to capitalize on the positive aspects of globalization and mitigate its negative effects.
6. Inclusive processes for decision-making, which involve civil society must be encouraged and promoted. Particular emphasis must be placed on the involvement of women, the poor and disadvantaged groups through involving them in decision making process, planning programme development, implementation and monitoring.
7. The lack of institutional capacity, to deal with the development needs of the urban poor, remains a severe constraint and bottleneck in many Asian countries. This is particularly the case with urban local authorities, which have the direct responsibility for the management of cities and address the special requirement of the urban poor. National governments should develop a proactive framework for national support to local administrations. At the same time, local governments need to act independently to improve local management and enhance capacity, capability, efficiency, accountability and responsiveness to needs of the urban poor, within the national framework and performance benchmarking.
8. The issues of the human security, natural disasters, and conflicts have become important in Asia in recent times as they affect the poor the most. We need concerted efforts in mitigating natural disasters such as typhoons, cyclones, floods, landslides, Tsunami and earthquakes.
9. In a few countries ongoing civil conflicts have gravely affected on development and increased vulnerability of urban poor due to rapid demographic movement. For effective reconstruction process and capacity building in post-conflict situation, special attention will need to be put in place, taking into account the lack of governance and pressure to governments to divert resources for social development programmes.
10. Increasing urban sprawl as well as the social and economic needs of the region’s cities call for an urgent need to enhance the planning function through a rapidly responsive intervention at all levels and taking into account the growth in fringe areas, peri-urban areas and rural-urban continuum to deploy it as an effective instrument of urban governance.
11. A new culture of planning process should be inclusive and provide a valid space for urban poor livelihoods and their living. Viewed in this light, planning is about getting a comprehensive, intensive utilisation of land and promoting innovative policies for formal access to lands by the poor, such as land sharing, land pooling, equality land and property rights to women.
12. Planning needs to be guided by innovative, imaginative, entrepreneurial principles of land management and administration. The process should establish pro-poor planning standards and building and construction regulatory framework that overcomes the rigidities often characterizing urban development and delivery of services especially for the urban poor population.
13. The dominance of the master plan seems to pervade a number of countries in the region. The master plan is projected to be a key official document for planned development of urban centres. The context of rapid economic growth has made urban planning to be quite challenging. It is necessary to adopt innovative planning tools to accommodate growth dynamics of cities.
14. Urban centres are the drivers of economic development, but often have limited resources to meet the growing demand for infrastructure and services especially for urban poor. However, questions still remain whether the needs of the poor are met or not. The solution to this lies in forging realistic public-private-people partnerships.
15. There is an urgent need to promote a sense of urban citizenship through fostering civic responsibilities and to adopt a ‘Citizen Charter’ in each city that provides a sense of inclusiveness and commitment by all, and that includes all social aspects of urban development.
16. Local institutional systems, including those dealing with regulatory functions, socialization, capacity building, livelihoods and appreciation of social and cultural values, conflict resolution, safety and security, need to be preserved and consolidated.
17. Urban renewal and urban development processes should pay particular attention to the needs of the urban poor and not resort to relocation without alternative. It should promote preservation and conservation of cultural heritage in cities.
18. A pro-poor orientation needs to be emphasized, which includes: an enabling condition for the poor, increased space for engagement, empowerment as well as the prevalence of inclusive systems. The poor contribute richly to the social economic development and GDP.
19. The issue of small island states with shortage of land, fragile eco systems, resources, fragmented nature of the populations, high urban migration, sea transport constraints and lack of viable social and public infrastructure, affect urban governance and planning responsive to all, especially the poor. This calls for a different perspective in urban management and planning that is responsive to the particular needs of the small island states and countries in the Asia Pacific Region.
20. Vision 2020: considering the prospects of vision 2020, governance and planning processes should aim at achieving cities without slums cities which are environmentally sustainable, liveable, economically viable, especially for urban poor.

IV. Slum Upgrading and Prevention

1. All slum upgrading and prevention activities undertaken in the region should be within the overall context of MDG Goal 7 Target 11.
2. The policy, projects and programmes at regional, national and local levels shall be guided by the following recommendations.
3. While it may be useful to agree on general principals and concepts for slum upgrading and prevention, each country and city may have to evolve and adopt specific practices and policies adapt to their unique local context.
4. Governments are to facilitate comprehensive assessments of slum living conditions, in the region and make information widely available and updated it regularly. UN-HABITAT and relevant local, national and regional institutions should be engaged in this process.
5. Governments at all levels should demonstrate strong and consistent political will which is critical to address the problem of slums and squatter settlements and will help in launching programme and policy initiatives at national and regional level. This is to be translated into formulation and adoption of a national policy on slum upgrading and prevention by 2008, inclusive of well-defined national and city targets.
6. Further, with a view to slum prevention, they should implement progressive policy reforms to facilitate the setting up of proper urban planning and land regulation and management systems that take into consideration different forms of land tenure; the provision of affordable and accessible land and housing; the improved coverage of water supply and sanitation services; appropriate institutional frameworks; and equitable economic policies.
7. Governments should not consider upgrading as a mere technical operation, implemented in a top-down manner. As part of a rights-based approach to housing, governments and other implementing actors should involve slum residents and their organisations through consultation and participation in the formulation, decision-making and implementation of projects, programmes and strategies for slum upgrading. Where needed, community participation should include capacity building for empowerment since slum dwellers are the first right holders. The objective of upgrading should be to integrate slum dwellers and the mainstream through rehabilitation and ensuring participation in all sectors.
8. Governments have to ensure that slum upgrading and prevention programmes provide equal opportunities for women and make them active participants in the entire process.
9. Governments in the region, multilateral and bilateral organisations and all stakeholders in the urban sector should focus on socio-economic development, such as employment generation, micro-finance and community-based credit schemes, while undertaking upgrading and prevention measures and programmes and should equally address the needs of women, youth and the disabled.
10. Governments should facilitate delivery of affordable serviced land and housing for low-income groups in suitable locations in order to prevent new slum formation. Land should be made available to individual families, communities, non-profit organisations, cooperatives, and the private sector. Housing delivery to be promoted should include different tenure forms such as affordable rental housing. Also, employer-assisted housing schemes, including sites and services with access to finance, insurance, and government incentives, should be considered as alternatives where possible.
11. Governments should explore possible public-private partnership to implement slum improvement and/or redevelopment projects particularly in high land value locations. Land use planning in such projects needs to be balanced between housing space and social and commercial infrastructure in order to avoid further densification/overcrowding and displacement. While redevelopment based on high-rise buildings can be a solution in certain socio-economic contexts, it can lead to a number of problems due to life-style issues, affordability, and infrastructure and maintenance constraints. These should be taken into consideration by governments when initiating such partnership arrangements. Above all, such initiatives should not be at the cost of slum dwellers’ access to land and services.
12. Based on the principle that water is life, and sanitation is dignity, coverage of water supply and sanitation services should be made available by governments or responsible agencies to slum dwellers irrespective of their tenure status.
13. Governments could use land as a resource in the process of slum upgrading and redevelopment projects to mobilize land value potential for generating revenues to cross-subsidise housing and infrastructure. They should explore possibilities for setting up a social equity fund from the realisation of such projects.
14. Governments should provide security of tenure to informal dwellers as the overarching condition for success and sustainability of upgrading; avoid eviction, and if resettlement is inevitable, they should find a negotiated solution based on slum dwellers right to adequate housing.
15. Housing finance is key to slum upgrading and prevention; governments should put into place legislative and fiduciary mechanisms to facilitate provision of affordable finance including micro finance and mortgages.
16. Governments should promote self-help groups and cooperative housing initiatives, especially for women, so that ownership stays in the community to avoid, inter alia, gentrification/sale of housing by beneficiaries.
17. Governments should scale up projects to large scale programmes at city and country levels facing up to the double challenge of upgrading existing slums and preventing future slums. However, governments in countries emerging from armed conflict or natural disasters should do upgrading progressively starting from quick impact projects that are attractive to the beneficiaries and include income generation opportunities.
18. UN-HABITAT, UNESCAP, ADB and other relevant organisations should play a key role in compiling and analysing country experiences in the region and disseminate them to countries. For slum prevention, they should carry out studies anticipating urban population increase in order to meet the challenge of slum prevention, particularly the need of housing for the weaker and migrating population and persuade policy-makers to adopt long-term housing plans, integrating the economically weaker sections into the mainstream, and provide guidelines.
19. Governments should build capacity for implementation of upgrading and prevention measures, including human and technical resources, where necessary through collaborative efforts with development partners. Further, governments should recognise and promote good cultural and traditional values that can enhance the livelihoods of slum dwellers.
20. Governments should strive to improve living conditions in rural areas and make rural centres more attractive to reduce population pressure on large cities and to promote well-functioning rural-urban linkages.

V. Delivery of Millennium Development Goals on Water and Sanitation in the Asia-Pacific Region

1. Asia Pacific is a region of great diversity in all its aspects - systems of administration, culture and availability of water. There can, therefore, be no one blueprint approach for the full provision of safe water and sanitation services to the people of each country. There are multiple routes to match each different set of circumstances particularly at the micro level.
2. However, the fundamental premise on which progress can be made is that ensuring the delivery of water and sanitation services is squarely the responsibility of each national government in Asia Pacific Region. But to be successful they will need, above all, determined leadership and the political will that is absolutely necessary to maintain the commitment that will be needed.
3. The burden associated with inadequate coverage and access and of inefficient service delivery falls heaviest on the most vulnerable and the poorest. Lack of access to safe sanitation affects women the most not only in terms of their health but also their dignity and safety, particularly in areas of conflict or those affected by disasters. Women and girls especially find their productivity impaired by their social roles and the costly and time-consuming tasks of collection and storage of water. Because of the lack of access and the poor quality of services, low tariffs often do not help the poor, who are less likely to be connected in the first place and rely on informal vendors.
4. Inadequate and ill directed financial flows together with poor technical and management capacities can and do frustrate otherwise positive policy initiatives and cripple water and sanitation service delivery. Further, restoration and up gradation of water sanitation services destroyed by conflict and natural disaster require special attention.
5. Enhancement of investment in water /sanitation services including government allocation, use of institutional finance (including banks), microfinance, and people’s own resources requires special attention.
6. Equal sharing of resources amongst various stakeholders including industrial and commercial establishments (who often benefit from perverse subsidies and low tariffs) and with poor communities (who suffer from high costs in terms of time and money from unreliable supplies of expensive water) based on bold increases in tariff levels with generous and targeted subsidies for poor families, with cost recovery for sustainability are required.
7. Provision of sufficient resources and incentives need to be presented for operation and maintenance including continued subsidies from central funds to local bodies/service providers who are not able to generate enough resources from consumers in their areas (applicable to both urban and rural situations where there are large numbers of poor people and fewer high payers including industrial and commercial establishments).
8. Investment in training and skill development at all levels of local service is required. A case can also be made for the capacity building of local elected representatives (mayors, members of locally elected bodies at town and village level) who can only discharge their obligations with proper information and some subject knowledge.
9. Civil Society organizations not only champion the cause of poor people but also introduce innovations in technical designs, management systems (including the role of women’s groups in traditionally male bastions such as technical maintenance of public water and sanitation facilities) and accountability measures such as social audits. Specific resources allocated to civil society organizations as would be a big step forward, particularly in outreach to poor communities.
10. Public disclosure of water and sanitation budgets and the regular scrutiny of expenditure is part of an accountability mechanism, which can help to direct resources to the right places (such as slum settlements) and to combat corruption.
11. Often it is the problems of big metropolitan centers that occupy the attention of policy makers and service providers. Secondary towns and peri-urban areas receive disproportionately small amounts of time, attention and resources should adequately be provided.
12. There is a need to create fiscal and legal measures (such as right to information) and systems that would enhance better disclosure. It should be applied to all government departments, public utilities or contracted private operators at other service providers.
13. Better information will make it more possible to measure performance, address problems and serve consumers according to their specific requirements. Civil society organizations can play an important part in the generation of accurate information (including mapping) about water and sanitation facilities, not just their availability but also their usage and their impact on the lives of poor people.
14. The sustainability of improved delivery hinges on institutional change, but the record of delayed projects or initiatives requires special mechanisms to expedite projects.
15. 65. Confusion in policy development, administration and accountability between government departments with a stake in safe water and sanitation provision including the ministries of health, urban development, water resources and possibly others is not unusual and more likely in rapidly growing urban conglomerations. Practical steps to improve the situation could include the following:
    • As far as national policy and planning is concerned, it is important to cut across different types of contexts – from big metropolitan centres to secondary towns and peri-urban areas.
    • In order to avoid harmful environmental consequences such as water logging and mixing of sewage with storm water it is important to plan water and sanitation projects in an integrated manner and not sequentially.
16. Policies relating to land tenure and occupancy rights in ‘unrecognized’ slums in urban conglomerations sometimes result in very large number of poor people being left out of water and sanitation projects. Suitable measures needs to be addressed to ensure great exclusivity.
17. Use of appropriate technology for water quality, solid waste management and including promotion of green technologies for sustainable environment management should be made.
18. Use of mapping tools like GIS to map coverage, resources and monitoring of quality and access to environmental services should be made.
19. While the primary responsibility for water and sanitation services is that of governments and appropriate local authority there is enough experience to show that they will need partnerships with others such as civil society organizations, the private sector and regional knowledge center to be able to reach the levels of coverage, especially among poor communities that will be necessary to reach the ambitious objective of full coverage.
20. Three imperatives are particularly important:
    • The need for a concerted campaign over the next five years to raise general awareness (of problems and solutions) about issues concerning water, sanitation, hygiene and the environment and generate the drive and momentum to change polices and governance practices, builds community empowerment and sector capacity.
    • The need for a multi stakeholder approach in each country to achieve synergies and a united effort.
    • The need for active sharing of information and experience across the region as part of a region wide initiative.
21. Above all, sanitation provision should be an overriding theme.

VI. Financing sustainable urbanisation

1. The following views and recommendations are related to financing sustainable urbanization. There is a need to consider the following recommendations based on different context of each country on scale of population, level of urbanization, level of prosperity, environmental situation, political and administrative arrangements and level of development.

Challenges and Opportunities

1. Compared to other continents, community and civil society movements in Asia Pacific region are relatively strong. There is a strong movement of self help groups in several countries. Women are playing a key role in civil society movements. But many of them operate at small scale.
2. Over half of the world’s inadequate housing units are located in Asia-Pacific – at roughly 500 million units. The housing sector is also severely constrained by lack of adequate and appropriate housing finance systems. In fact, Asia’s mortgage sector is one of the least developed in the world. In Asia, many countries’ mortgage financing per year is less than 2 per cent of GDP.
3. The majority of the poor in Asia rely on non-mortgage based financing for housing, partly through shelter microfinance and community funding. Several governments in the region have made significant interventions through a variety of measures to reach out to low income households.
4. Many of the cities in the region are not creditworthy. There is a paradox of rich citizens and poor city governments. But there are several innovations the region is undertaking in improving the governance and bankability of cities. Many cities are creating world class infrastructure to promote economic growth. Similarly, some countries have supported local government reforms related to: enhancing accountability, creditworthiness and own revenues; creation of incentive funds to promote reforms; streamlining of inter-governmental transfers; encouraging market based investments; and, creation of municipal bond markets.
5. The Conference acknowledges that there is a large finance gap in housing and infrastructure sectors in many countries of the region. Provision of housing and related services continues to be a challenge in many Asian cities. Increasing levels of income, globalisation and empowered urban citizens are demanding higher levels of services in many of the Asian countries. There is also significant pressure to create Asian world class cities. Given the structure of the economies of the countries in the region and integration with world markets, Asian cities will have to be competitive on a global scale both in terms of quality and cost efficiency of urban management.
6. The financial sector in the region is comparatively well developed to play a critical role in housing and infrastructure finance. Many countries have liberalized their financial markets. The stock markets in many of the countries are large and well developed. The region is also experiencing significant growth of the Islamic banking system. But the participation of financial markets in financing of housing and urban infrastructure has been limited, and efforts have to be made to bring them on board in many of the developing countries of the region. The depth and breadth of the capital markets provide opportunities to tap private domestic capital. In general, the private sector has contributed substantially to development in the region.
7. Micro-finance institutions and informal markets dominate the financial services for the informal sector and poor in many parts of the region. The penetration of micro-finance into the shelter finance sector is significant in many of the developing countries of the region. Significant efforts are underway to integrate the informal (including micro-finance) markets with formal ones in many of the countries in the region. Community-led Development Process and Civil Society Participation
8. There is a need for scaling up of these movements and processes and introducing the same in other developing countries which do not currently practice them in a comprehensive way. There is a need to promote urban low-income housing policies and programs that are people-centred but community-based.
9. Non-governmental organisations and other civil society institutions have an important role to play in ensuring access to finance especially for poor.
10. Women have central role in any system of the housing and financing as evidenced in many countries and as mandated by UN resolutions. Ownership and leasehold rights, borrowings, basic services may be provided to the women Deepening of Housing Finance Markets
11. Given the innovations and improved economic growth in the region, there is significant scope for deepening of the housing finance markets and financial services industry, especially for low-to-middle income households in many of the developing countries of the region. The key measures in this regard include:
    • Promote affordable housing through provision of improved service delivery and making available serviced land at the right time and the right price;
    • Improve land use planning as well as make land available through various measures (including land banks);
    • Promote incremental housing and incremental financing linked to: affordability and increasing household incomes based on a non- discriminatory basis;
    • Encourage lease and rental solutions for the housing and land for low income households;
    • Design and implement specific finance products for housing and infrastructure for the poor within the main financial system as well as through micro-finance institutions based on affordability (to lend on an incremental basis);
    • Establishment of special purpose vehicles for intermediating market based housing finance and for improving the management of housing stock, which could be funded from various sources including private sector;
    • Introduction of credit bureaus for sharing market information on clients;
    • Establishment of mortgage insurance/credit guarantee facilities including for title guarantees;
    • Promote securitization mechanisms and other secondary market development measures to promote liquidity for housing and infrastructure finance;
    • Facilitate long term funds for housing and infrastructure;
    • Deepen life and non-life insurance products especially for low income households; and, housing loan products that are linked to contractual savings products;
    • Encourage alternative house building techniques; and, appropriate standards and technologies, through building centres, to reduce the cost of construction of house for the poor;
    • Encourage applied academic research in the urban sector and promote best practices.

Enhancement of the Financial Capacity of Local Governments

1. Enhanced fiscal capacity of local governments enables them to undertake development work at a large scale. It is essential that cities are made to work for all citizens – equitably and efficiently. There are several important actions that include:
   • Fiscal decentralization aimed at improving own revenue base of cities;
   • Promoting land based revenue measures such as impact fees and valorization charges to finance major infrastructure such as public transport;
   • Empowering cities to undertake land development with a pro-poor focus; Enhancing the quantity and predictability of inter-governmental transfers, with special attention on output based aid and incentives for reform;
   • Promoting credit rating of local governments;
   • Rule and market based municipal borrowing frameworks;
   • Promoting transparency and efficiency in public expenditure;

Role of Private Sector and General Financial Services Industry

1. 85. The following are the key recommendations related to private sector and financial services industry
   • Deepen non-mortgage financing for the housing and services for the poor through intermediaries such as micro-finance institutions. Housing finance may be extended in parallel with finance for income generating activities and linkage to markets;
   • Promote private sector participation for housing and services through “Bottom of Pyramid” approaches as well as Corporate Social Responsibility (CSR);
   • Promote universal access to comprehensive financial services;
   • Promote capital flows from international markets, international financial institutions, foreign investment based on national policies

Government Financial and Non-Financial Support

1. The affordability of the majority of the low-income households is a significant concern. Governments have a critical role to play in creating sustainable financing mechanisms for housing and infrastructure development. The following are the recommendations:
   • Explore introduction of direct but targeted pro-poor “smart” subsidies for housing; and in some cases, output-based aid for infrastructure;
   • Explore initiating and sustaining dedicated large-scale comprehensive national investment programmes for: income-generation; service provision; and, housing development in low-income neighbourhoods.
   • Attract community and private sector financial resources to supplement government resources in the national programmes;
   • Explore incentives such as tax concessions or tax holidays to promote private sector participation and attract the financial sector in urban development.
2. The governments can also provide substantial non-financial support through the following measures:
   • Emphasis on housing and urban development in national development policies; Legal reforms to promote private sector participation and attract domestic financial sector into urban development especially for low income households;
   • Influencing utilization of donor support for housing and urban development;
   • Ensuring that laws are enforced;
   • Addressing issues of environmental degradation to lessen the risk and manage the cost of housing and settlement development.

Regional Activities

1. There is a need for capacity building of key stakeholders and experience sharing in the region through regional forums and other mechanisms.
2. Explore the possibility of establishment of regional fund for providing housing finance for poor in the Asia-Pacific Region.

Follow-up Actions

1. It is time to focus on action. There is a need to implement projects and programmes that move the agenda forward no matter how small or big. Through these interventions, it would be possible to: test the theories and the market; bring commercial orientation in local governments; and build scalable and workable solutions to address the problems of slum upgrading and slum prevention. There is also need for establishing country-level technical assistance facilities that support project implementation and policy reforms.
2. To enhance the understanding on multiple dimensions of urban poverty and various types of vulnerabilities that urban poor face, it is desirable that each member country develops and adopts a national strategy for sustainable and inclusive housing finance system. Such a strategy may include a well-defined National Action Plan, which may be regularly monitored for ensuring the outcome.

VII. Consultative Mechanism

1. Establish and institutionalize a consultative mechanism of Asia-Pacific Ministers responsible for housing and urban development. The consultative mechanism will play a significant role in the realization of the vision of sustainable urbanization by 2020 in Asia-Pacific.
   The Consultative Mechanism should:
   • Serve as a forum and network to discuss the urban challenge at the continental level and regional level as a basis for national, provincial and local level strategies and policies and as a focus for the discussion of the Habitat Agenda and the relevant Millennium Development Goals and Targets;
   • Encourage and promote the strengthening of good urban governance in Asia Pacific and serve as a platform for advocacy of inclusive urban governance;
   • Champion and support innovative housing, urban development and land management practices in Asia-Pacific;
   • Promote development of appropriate housing and low-cost construction technology for rural and urban housing;
   • Facilitate South-South and international exchanges of expertise, research, experience and best practices in human settlements among private sector, civil society and other stakeholders in the region;
   • Develop a better understanding of urban land dynamics that can lead to improved land tenure and to the growth of urban land markets in Asia-Pacific ;
   • Provide and promote a supportive environment for informal sector activities, including street vending, within national regulatory framework;
   • Support relief and rehabilitation of shelter and human settlements development in post-conflict and post-disaster situations;
   • Urge development partners and multi-lateral agencies to assist Asia Pacific countries on financing housing and urban infrastructure development;
   • Promote capacity building efforts and encourage strong ties between research institutions to understand better the economic, legal and financial importance of housing urban development and urban land in Asia-Pacific;
   • Encourage the collection and sharing of data and information that can improve the planning and management of urban development;
   • Promote the institutionalisation of a culture for urban planning including the preparation of urban strategic plans at both national and local authority level;
   • Encourage the mobilization of domestic financial resources for housing and urban development and promote the necessary partnerships for attainment of this objective;
   • Mainstream urban and other issues dealing with human settlements in the macro-economic frameworks and national budgets of Asia-Pacific governments;
   • Provide a focal point to link relevant aspects of regional strategic initiatives as well as international processes and undertakings consistent with the agenda for sustainable urbanisation;
   • Establish monitoring and evaluation mechanisms;
   • Encourage partnerships with private sector for shelter , urban infrastructure and services ;
   • Undertake all other functions that will lead to the realization of the goals of the Enhanced Framework of Implementation for Housing and Human Settlements in Asia-Pacific adopted by this Conference;
   • Explore possibilities of establishing a regional fund for housing finance for the poor;
   • Encourage fast-track implementation of water and sanitation programmes to achieve the MDG targets;
   • Promote broad-based participation, taking into account the issues related to youth, women, disabled, and vulnerable groups;
   • Promote and encourage policies and programmes that are people centric and community based;
   • Promote a sense of urban citizenship through fostering civic responsibilities.
2. . Establish links with other inter-ministerial conferences working on issues related to the Habitat Agenda, including, but not limited to, matters concerning water supply and sanitation, local government, land and infrastructure.