Dar moves to harness city’s economic benefits

MASATO MASATO

KIGAMBONI bridge, the first of its kind in East Africa, that connects Dar es Salaam’s central business district and Kigamboni area across the Kurasini creek is scheduled for official opening this morning.

The 680-metres long cable-stayed bridge is opened hardly two days after President John Magufuli laid the foundation stone for the construction of the magnificent TAZARA flyover in the city on Saturday.

The grand projects are just a fraction of more coming infrastructure projects that the government says is determined to develop in order to harness the potential of cities as the engines of economic growth.

The World Bank, in its latest analysis of Africa’s economic trends, Africa’s Pulse, says the rapid urban growth that Africa is undergoing, if well managed, can spur economic growth and productivity through boosting incentives for investors and making cities more livable for poor and middle-class residents.

The Breton Woods Institution, though acknowledging urbanisation as a source of dynamism that can enhance productivity and increase economic integration, decries Africa’s failure to exploit the potential economic benefits.

“Unfortunately, African cities are neither delivering agglomeration economies nor reaping urban productivity benefits...they instead suffer from high food, housing and transport costs,” says the institution.

Coordination failures, poorly designed policies, weak property rights, according to the analysis are some of the factors that lower economic density in African cities, raising urban costs, which impede development. The report estimates urban population in Africa at 472 million, the number that will double over the next 25 years, creating huge demand for productive jobs, affordable housing and efficient infrastructure.

Amid plummeting oil and commodity prices, the report authors propose expansive cities as one of the generic capitals for urgent economic diversification in Africa.

“The growth of cities will be central to development in Africa and elsewhere ...cities must become more livable for their residents by offering services, amenities and housing for the poor and middle class,” says the institution in its 64-page report that puts Tanzania among the three East African countries whose economies grew strongly in 2015 despite the overall slowdown in economic activities in Sub-Saharan Africa.

The Gross Domestic Product growth in the Sub-Saharan Africa averaged three per cent, down from 4.5 per cent in 2014, with the decelerating growth blamed on low commodity prices, weak growth in major trading partners, rising borrowing costs and adverse domestic developments in many countries.

Tanzania, Kenya and Rwanda and most oil-importing countries had their economies remaining buoyant, helped by infrastructure spending, strong consumer demand and expansive service sector.

“Tanzania registered strong growth, underpinned by expansion in construction and service sectors,” says the report. Cities and municipal mayors, especially in Tanzania, need to borrow a leaf from the report, and resolve structural problems that trouble urban inhabitants and limit their productivity. Poor drainage system in Dar es Salaam for instance, subjects people to routine floods that come with communicable diseases, including the deadly cholera.

Heavy traffic jams consume huge economic resources in terms of wasted productive time and fuel burnt by stationary automobiles. The fall in commodity prices represented a significant shock for the region whose 60 per cent of exports comes from fuels, ore, and metals, with manufactured goods and agricultural produce accounting for 16 and 10 per cent, respectively.

“In several instances, the adverse impact of lower commodity prices was compounded by domestic conditions like electricity shortages, policy uncertainty, drought, and security threats, which stymied growth,” says the analysis team leader Punam Chuhan-Pole while presenting the report from Washington through a video conference last week.

She advised African cities to put in place effective systems to identify and collect revenues from real estate that offers substantial earnings to improve social amenities in cities, noting that external environment that confronts the region was likely to remain difficult due to weak policy buffers in some countries. African cities, and Dar es Salaam in particular, cannot afford to remain costly for households, workers and businesses.

For the high costs that make cities less livable also constrain the national economies