It leads to improvements in the living standards of a considerable part of the world's population. Most countries with high rates of urbanization during the last decade also experienced economic growth. In addition, an increasing number of cities have taken on significant roles in globalizing the economy, in terms of financial markets, trade and commerce. Poorly managed cities lead to the deterioration of urban living conditions. Urban poverty results because in many countries, national and local governments cannot plan for the population increases, and fail to provide the required infrastructure, services and jobs.
Good governance is needed for sustainable urban development.
It requires stronger roles for citizen groups, community organizations and NGOs. The Habitat report says that the shift from agriculturally based to industrial and service- based economies has caused an irreversible movement to cities and the urbanization of rural areas. Urban areas offer a higher life expectancy and lower absolute poverty, and can provide essential services more cheaply and on a larger scale than rural areas. Cities have many other advantages. The high population densities mean lower costs per household and per enterprise for the provision of water, waste disposal and health care.