There are four major trends that impact cities in the region.

• By the year 2010, 4.2 of the world’s 7 billion population will reside in Asia and the Pacific region;

• About half (45%) of the world’s GDP growth will take place in Asia;

• Forty-three percent of the Asian population will live in cities; and

• Thirty-three Asian cities will have populations of 5 million or more in the new millennium.

The Challenge

More and more the capacity of nations to pursue their economic and social goals has begun to depend on their ability to govern their cities. As a result. Urban governance has assumed increasing importance. This is largely due to the quantum and quality of contribution that urban centers make to the national income and to other spheres of development such as creation of social and political ideals, transfer of information and technology, and creating social capital through fostering of arts and culture.

Cities are often referred to as engines of economic growth. They are also hubs of political and cultural fusion. Globalization and the attendant liberalization of economy in most Asian nations highlight the growing urban predominance over the national life and character. They are interdependent as never before.

"For better or for worse, the development of contemporary societies will depend largely on understanding and managing the growth of cities;’ the city will increasingly become the test bed for the adequacy of political institutions, for the performance of government agencies and for the effectiveness of programmes to combat social exclusion and to promote economic development." (UNCHS/Habitat Urban Indicators Programme Home Page, January, 1999)

Urban local administrations in many countries have generally shown a serious lack of ability and capacity to carry out many of their major statutory responsibilities. They have failed to maintain their cities as clean, caring and responsive habitats. Moreover, there is much to be desired in the maintenance of the rule of law. In the Eighties, local governments attributed their failure to their lack of local autonomy. But the Nineties saw a substantial transfer of power and authority from central to local governments, without much corresponding improvement in local government.

The nature of state too is changing towards democratic and administrative decentralisation, greater local autonomy & control and community empowerment & community-based management. These are challenging new flight-paths for governments.

The response to these challenges lies in good governance. "Wherever change is for the better, wherever the human condition is improving, people point to good governance as the key. This better governance is not just national - It is local, regional and it is global. Few things are more sensitive - and more challenging – than improving governance." (James Gustave Speth, UNDP) Good governance makes accountability, transparency, participation and rule of law mandatory administrative functions. Those are four vital pre-requisites for sustainable change.