Sa Paulo, for instance, contributes 40 per cent of Brazil's GDP and 60 per cent of its manufacturing value added. But the bias in favour of urban development also leads to distortions in national economies. The rural areas often suffer from under-investment by both state bodies and private companies. In addition, the desire to keep food prices low for urban dwellers often results in farmers receiving poor returns for their products, locking them into a cycle of under-investment, high interest charges on loans, debt and poverty. Environmental hazards remain a major source of ill-health, injury and premature death in the urban areas of the South.
Cities also contribute to non-sustainable development on a global scale.
Official figures for 1994 show that nearly 300 million city dwellers are still not served by water supplies and almost 600 million lack sanitation. Employment is a big problem in the cities of the South. The World Bank has estimated that the informal sector now accounts for 75 per cent of urban employment in sub-Saharan Africa and 85 per cent in Pakistan. Such findings have led the World Bank to call on governments to assist in the formalisation of this sector as part of their development strategies, by reducing regulatory impediments, upgrading infrastructure, and improving access to credit. In the past, the solution to urban ills was often seen to lie in preventing further urban expansion.