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 needed to catty out their functions. This leads to frustration, to continuing criticism of local government for insufficient and inefficient services, and to a downward spiral of weakness feeding on weakness.

37. The lack of political access to an adequate financial base is a major weakness of local government in many developing countries. Most local governments have difficulties getting enough revenue to cover their operating expenses, let alone to make new investments to extend services and facilities. Even richer city governments have access to the equivalent of only $10-50 per inhabitant to invest each year. Despite these weaknesses, the trend in recent decades has been for national governments to reduce the financial capacity of local governments in real terms.

38. The result is growing centralization sad continuing weaknesses at both the central and local Level. Instead of doing a few things well, central authorities em up doing too many things, none of them well. Human and financial resources get stretched too thin. Local governments do not gain the expertise, authority, and credibility needed to deal with local problems.

39. To become key agents of development, city governments need enhanced political, institutional, and financial capacity, notably access to more of the wealth generated in the city. Only in this way can cities adapt and deploy some of the vast array of tools available to address urban problems – tools such as land title registration, land use control, and tax sharing.

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3. Self-Reliance and Citizen Involvement
}} 40. In most developing countries between one-fourth and one-half of the economically active urban population cannot find adequate, stable livelihoods. With few jobs available in established businesses or government services, people have to find or create their own sources of income. These efforts have resulted in the rapid growth of what has been termed the 'informal sector' which provides much of the cheap goods and services essential to city economies, business, and consumers. /…