Some 52 per cent of Africa’s population are expected to live in towns and cities by 2025. There is generally an unequivocal correlation between urbanisation and economic development and growth, but in Africa this appears not to apply owing to ‘distorted incentives’. Urban areas play a significant role in the democratisation process. There is a close relationship between urban and rural development, both in macro-economic terms and through migration and urban-rural links. The proportion of women in migration flows to cities is increasing, and the urbanisation process impacts significantly on the status and roles of women. Female-headed households are a predominant feature of poor urban areas. The environmental problems facing developing countries are largely associated with cities. Poverty is increasingly an attribute of urbanisation, and urban poverty exhibits specific features that need to be understood better. Urbanites depend on a commercialised market for goods, services and land, making employment and income the key determinants of well-being.\nThe late 1990s have seen a renewed interest in urban issues in the donor community and many agencies have embarked on new urban strategies. The challenges are a concern both of policy and of institutional capability in pursuit of policy. The urban policies of selected bilateral and multilateral aid agencies are reviewed.\nTo achieve greater coherence and enhanced involvement in urban matters NORAD is advised to elaborate an urban development strategy. Such a strategy must incorporate the array of relevant substantive issues in a comprehensive fashion, with a focus on urban poverty reduction.
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