By Maggie Romuld

Several months ago, Anna Tibaijuka, Under Secretary-General of the United Nations (UN), and Executive Director of the UN Agency for Human Settlements (UN-HABITAT), spoke about the continuing global concern for adequate shelter and the effect of the current housing and finance crisis on the world's poor. The focus of her speech was, "Ways in which the global financial systems might respond to the growing gap between the housing 'haves' and the housing 'have-nots.'"

The statistics are abysmal. In 2007 we officially became an urban planet. While it is difficult to definitively characterize global urban areas because each country uses different factors to distinguish between urban and rural, it will suffice to say that today, more than half of the world's population are living in areas considered "not rural." And, of the three billion "not rural" residents on the planet, fully one billion are slum dwellers, a number estimated to grow by 25 million a year. The unrestrained growth of urban areas, especially in less-developed countries - where the UN predicts increases of 2.3% a year between 2000 and 2030 - makes sustainable urban development one of the most challenging issues facing humanity. Without adequate shelter, clean water or basic sanitation, masses of "have-nots" are being condemned to a life of poverty, ill health and marginalization because they are living in economically, environmentally and socially toxic environments.

Despite early predictions that megacities would experience the largest increases in population, most growth is occurring in cities of half a million people or less, those least likely to have the resources to cope with escalating numbers. The prevalence of slums and shanty towns confirms that local governments are frequently incapable of managing in-migration and agglomeration processes accompanying the growth of their urban regions; however, Thoraya Obaid, head of the UN Population Fund (UNFPA), warns that urban growth must, somehow, be carefully managed. "Slums, poverty and violence exist because urban growth has not been well managed," she says. "Policies have to be changed and the proper investments and programs have to be made."

Mrs. Tibaijuka believes that there are several essential issues that must be addressed to manage housing alternatives for the urban poor. The first concern is the availability of sufficient land for low-income housing; the second, servicing the land with proper access and basic infrastructure - drainage, water supply and sanitation; and third, access to formal credit arrangements so slum dwellers can mobilize savings and invest in their own future. While there is some agreement about what needs to be done, there is less agreement about how to make it happen. There are many who believe the problem is best solved politically, with city authorities enacting new laws and installing services before opening up urban land to development. Others believe solutions shouldn't be imposed by local politicians or international donors - they support the idea of working directly with organizations which represent the poor, who frequently have innovative and adaptive solutions to their own plight. In Windhoek, Namibia, the Shack Dwellers Federation (SDF) and Namibia Housing Action Group (NHAG) are working together with local government to facilitate housing for the poor. While government policies have been implemented for upgrading settlements, subsidizing costs, encouraging savings and making available long term housing loans, the NHAG and SDF also play an important role. They bring people together, link government, UN and donor agencies, advocate for change in planning standards to make projects affordable, provide technical support and loans, and help mobilize savings and access land.

UN-HABITAT is field testing several housing and finance initiatives including the Slum Upgrading Facility (SUF) and the Experimental Reimbursable Seeding Operation (ERSO). The objective of SUF is "to work with domestic financial institutions and community organisations to mobilise local domestic capital for slum upgrading and related infrastructure activities through a blending of grants, capacity building and technical assistance to poor urban communities and municipalities." Several pilot projects have been established within this framework in Africa, where assistance is offered to housing cooperatives to access finance for land acquisition, housing development and mortgage finance. The objective of ERSO is "to develop experimental loan operations and other innovative financial mechanisms for enabling access to housing finance."

George Martine, lead author of the latest official report on population trends from the UNFPA (State of the World Population 2007) states that cities need to abandon the traditional approach that has allowed sprawling slums to develop. "What's absolutely clear and non-negotiable is that we can't carry on as we are." The report notes that, "Cities must begin preparing affordable land for the poor to live on," and by "installing crude roads, sanitation, electrical supplies and clean water, cities can forestall the haphazard and uncontrolled growth of shanty towns that blights many urban areas." Martine also reiterates what many people involved with third world affordable housing already know as absolute truth - cities have to start to prepare now, and if they don't, the slums will just get worse. He states, "We need new mindsets and a revolutionary, proactive approach."