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'с5.+` � ,.:Yt. ы�1' . �Г�J";t.1 '� . � � ,i. . . _ ...... . , � . �� ,. ;. ....г� ._, � . ... ._ �,.ы�"` . :. . .и. " / У • Г_ ' - .r� °у . �� ,._ • �, 7� ` . т . �'t � ' _ „ 1 , �s � � • �f� � .{ г . • . , . [ f , �7' + г � � . • ` � , � � . , . r � jт rы�� 5tci�fil� < � w � '. } � А �r • , - � 5 6 ч ь � j% �т , + . _�. . : ю � ., .- , . Г � . , . �. ,� _. ... -аа ,'.�,i �.. i!. % . ,i,. � �'�f ' J f �1� ��"з � � �� � . . � � � ! � . . . .. ... � . 4 � � ACKNOWLEDGEMENTS This report was prepared by a team including Judy Baker (Team Leader, Lead Economist), Sarah Xinyuan Lin (Co- Team Leader, Urban Specialist), Natsuko Kikutake (Co-Team Leader Urban Specialist), Zheng Jia (Operations Analyst), Khin Aye Yee (Operations Officer), and Qiyang Xu (Consultant). Martin Fodor (Senior Environmental Specialist) and Katelijn Van den Berg (Senior Environmental Specialist) provided inputs on urban solid waste management, Alex McPhail (Lead Water Supply and Sanitation Specialist) on water and sanitation. Haruka Imoto (Knowledge Management Analyst), Tatsuya Shirahase (Consultant) and the Tokyo Learning Development Center provided inputs on Japanese case studies on urban inclusion. Mark Austin, Program Leader provided helpful inputs. Comments were provided by peer reviewers Ahmed Eiweda (Lead Urban Specialist), Makiko Watanabe (Senior Urban Specialist), and Andrea Woodhouse (Senior Social Specialist), Soraya Goga (Lead Urban Specialist) and Ellen Hamilton (Lead Urban Specialist) and by Natacha Caroline Lemasle (Senior Social Development Specialist, GSU02), Sadig Aliyev (Senior Transport Specialist, GTR02), Giorgia Demarchi (Social Scientist, GPV02), Ikuko Uochi (Economist, GPV02), Myint Kyaw (Operations Officer, EACMM). The work program was carried out under the overall guidance of Abhas Jha, Practice Manager, Global Practice for Social, Urban Rural and Resilience (GSURR), East Asia and the Pacific, Ellen Goldstein (Country Director), Gevorg Sargsyan (Operations Manager), Sameh Wahba, (Director, GSURR), and Ede Jorge Ijas6-Vasque6 (Senior Director, GSURR). CONTENTS ACKNOWLEDGEMENTS i ABBREVIATIONS AND ACRONYMS vi EXECUTIVE SUMMARY viii CHAPTER1: INTRODUCTION AND CONTEXT 1 1.1 INTRODUCTION 3 CHAPTER 2: ECONOMIC INCLUSION 11 2.1 INTRODUCTION 13 2.2 URBAN GROWTH CENTRES AND ECONOMIC OPPORTUNITIES 13 2.3 EMPLOYMENT IN URBAN AREAS 14 2.4 RISK AND RESILIENCE AFFECT ECONOMIC INCLUSION 19 CHAPTER 3: SPATIAL INCLUSION 21 3.1 INTRODUCTION 23 3.2 URBAN AND SPATIAL POLICIES AND PLANNING 23 3.2 URBAN PLANNING CHALLENGES 30 3.3 LAND 33 3.4 HOUSING 37 3.4.1 ISSUES AROUND EXCLUSION IN THE HOUSING MARKET 37 3.4.2 AFFORDABLE HOUSING 38 3.4.3 INFORMAL SETTLEMENTS 38 3.4.4 MILLION HOMES PLAN 39 3.4.5 NATIONAL HOUSING POLICY AND STRATEGY 40 3.5 INFRASTRUCTURE AND BASIC SERVICES 43 3.5.1 URBAN MOBILITY AND TRANSPORT 44 3.5.2 URBAN WATER 48 3.5.3 URBAN SANITATION 51 3.5.4 SOLID WASTE MANAGEMENT 52 3.5.5 DISASTER RISK MANAGEMENT (INCLUDING FLOOD CONTROLAND DRAINAGE) 54 CHAPTER 4: SOCIAL INCLUSION 57 4.1 URBAN MIGRANTS 60 4.2 URBAN POOR 61 SLUM DWELLERS FACE MANY CHALLENGES 62 CRIME AND VIOLENCE FURTHER AFFECTS VULNERABLE GROUPS 63 4.3 PEOPLE WITH DISABILITIES 64 4.4 GOVERNANCE, COMMUNITY NETWORKS, AND PARTICIPATION 66 CHAPTER 5: GOVERNANCE AND FINANCE FOR INCLUSIVE URBANIZATION 67 5.1 GOVERNANCE AND INSTITUTION 69 5.1.1 INTRODUCTION 69 5.1.2 LEGAL AND POLICY FRAMEWORK 69 5.1.3 ADMINISTRATIVE CAPACITY 72 5.2 FINANCING 74 5.2.1 FISCAL RESOURCES 74 5.2.2 PROPERTY TAX 76 5.2.3 REVENUE COLLECTION AND MANAGEMENT 79 5.2.4 SUBNATIONAL GOVERNMENT BORROWING 79 5.2.5 PRIVATE SECTOR 79 5.2.6 EXPENDITURES 81 5.2.7 PUBLIC FINANCIAL MANAGEMENT 83 CHAPTER 6: PRIORITIES FOR CREATING INCLUSIVE CITIES IN MYANMAR 85 6.1 INTRODUCTION 87 6.2 PROMOTING ECONOMIC INCLUSION 92 6.3 PROMOTING SPATIAL INCLUSION 95 6.4 PROMOTING SOCIAL INCLUSION 102 6.5 FOSTERING GOOD GOVERNANCE AND FINANCING FOR INCLUSIVE URBAN 104 DEVELOPMENT 6.6 CONCLUSIONS AND PRIORITYAREAS FOR FUTURE RESEARCH 107 DEVELOPMENT PARTNER ASSISTANCE ON URBAN DEVELOPMENT 107 AREAS FOR FUTURE DIAGNOSTIC WORK 109 REFERENCES 114 iii1 List of Figures Figure 1.1: Multi-dimensional Framework for Inclusive Cities 4 Figure 1.2: Share of Urban Population, EAP countries 6 Figure 1.3: Share of People Living in Urban Area by Township 8 Figure 1.4: Urban Expansion, Yangon, 1975-2014 10 Figure 2.1: Growth Centers 14 Figure 2.2: Population with Access to Corridors 14 Figure 2.3: Firms in Industrial Zones 15 Figure 2.4: Top Obstacles Faced by microentrepreneurs in Myanmar, 2015 18 Figure 3.1: Myanmar's Administrative System and Planning Process 24 Figure 3.2: NSDF Hierarchy of Cities 25 Figure 3.3: NSDF Development Corridors 25 Figure 3.4: Functions of DAOs 26 Figure 3.5: Urban Function, Industrial Function, and Green and Water Function Envisioned in Greater 29 Yangon Master Plan Figure 3.6: Administrative Structure, Yangon Region Government 32 Figure 3.7: Investment Needs in Myanmar's Large Cities, 2010-2030, McKinsey Global Institute 43 Figure 3.8: Vehicular Fleet in Yangon 44 Figure 3.9: Modal Split in Yangon, 2013 (%) 45 Figure 3.10: Public Transport Volume in Yangon 46 Figure 3.11: Sources of Drinking Water in the Dry Seasons 48 Figure 3.12: Revised Water Supply System for Greater Yangon (2025 and 2040) 50 Figure 4.1: Motivation for internal migration 60 Figure 5.1: Administrative Structure of Myanmar 70 Figure 5.2: State/Region Government and DAOs 70 Figure 5.3: Breakdown of SNG Fiscal Resources 75 Figure 5.4: DAO Revenues 2016/17 for Selected Cities 76 Figure 5.5: Composition of Property Tax and Tax Rates Applied for Selected Cities 77 Figure 5.6: SNG Own-Source Revenue Collection 79 Figure 5.7: Expenditure Across Levels of Government 81 Figure 5.8: Breakdown of SNG Expenditure (by Expenditure Category) 82 Figure 5.9: Breakdown of SNG Expenditure (by Executing Agency) 82 Figure 6.1: Framework for Broad Priority Actions for Building Capacity 93 Figure 6.2: Before and After Images of Urban Upgrading in Vietnam 96 Figure 6.3: Singapore's Urban Planning Framework 99 Figure 6.4: Singapore's Land Use and Master Plans 100 Figure 6.5: Land Subsidence, Population Density and Water Supply in Semarang 101 iv List of Tables Table 1.1: Data Sources 5 Table 1.2: Internal Migration, Top 20 District-to-District Flows for Recent Migrants, 2014 7 Table 1.3: Proportion of Population in Urban Areas by State/Region 9 Table 2.1: Employer Difficulties in Hiring, 2016 (%) 16 Table 3.1 YCDC Departments 27 Table 3.2: Laws Related to Urban Planning and Management 28 Table 3.3: Government Agencies Providing Land Services 34 Table 3.4: Laws and Regulations Related to Land Rights 34 Table 3.5: Conventional Households by Types of Housing Units in Yangon 37 Table 3.6: Conventional Households by Types of Ownership in Yangon 38 Table 3.7: Low-Cost and Affordable Housing Projects Completed by DUHD (2010-2016) 39 Table 3.8: National Housing Policy and Strategy 2017 Approach 41 Table 3.9: Status of Laws and Regulations Related to Housing 41 Table 3.10: Challenges of the Commercial Sector Housing Finance 42 Table 3.11: Trip Rates in Yangon (2013) 44 Table 3.12: Urban Transport Needs 47 Table 3.13: Institutional Responsibilities for Urban Water Supply and Wastewater 49 Table 3.14: Water Supply Components of MUSIP1 and MUSIP2 51 Table 3.15: Wastewater Management Components of MUSIP1 and MUSIP2 52 Table 3.16: Major Landfill Sites in Yangon and Mandalay 53 Table 5.1: Comparison of DAO and other Subnational Entities 71 Table 5.2: DAO's Duties and Functions 71 Table 5.3: SNG Current Revenue Breakdown 74 Table 5.4: Taxes and Charges on Property in Myanmar 76 Table 5.5: Current Conditions of Property Tax Administration for Selected Cities 78 Table 5.6: Various Land Value Capture Schemes 80 Table 6.1: Priority Policy Recommendations for Inclusive Urbani6ation in Myanmar 88 Table 6.2: Development Partners in Myanmar: Urban Sector Engagement 108 Table 6.3: Priority Policy Recommendations by time Frame 110 List of Boxes Box 1.1: Analy6ing Urban Development in Myanmar: Data Resources 5 Box 1.2 Internal Migration Patterns in Myanmar 7 Box 2.1: Health Shocks and Welfare in Myanmar 20 Box 3.1 Urban Planning in Yangon City Development Committee (YCDC) 27 Box 3.2: Urban Plans in Yangon 29 Box 3.3: Smart Cities - Rwim Map Digiti6ing and Spatial Data Procession Under Land Administration 36 and Management Program (LAMP) Box 6.1: Moving beyond Informality - Policy Priorities for Skills Development and Examples of Success 93 Box 6.2: Vietnam Urban Upgrading Project 95 Box 6.3: Addressing Affordable Housing in Indonesia 97 Box 6.4: Japan's Legal System for Low-Income Housing and Public Housing Measures in Airin District, 98 Japan. Box 6.5: Urban Planning in Singapore 99 Box 6.6: City Planning Labs in Indonesia 101 Box 6.7: The ID4D Program 103 Box 6.8: From Suppression to Cooperation -Bottom-Up Community Development in Airin District, Japan. 105 v ABBREVIATIONS AND ACRONYMS ADB Asia Development Bank FAR Floor Area Ratio AFD Agence Franqaise de D6veloppement FDI Foreign Direct Investment ARV Annual Rental Value FESR Framework for Economic and Social ASEAN Association of Southeast Asian Reforms Nations FPIC Free, Prior and Informed Consent BORDA Bremen Overseas Research and GAD General Administration Department Development Association GEN Gender Equality Network BOT Build-Operate-Transfer GHSL Global Human Settlement Layer BRT Bus Rapid Transit GIS Geographic Information System CBD Central Business District GIZ Deutsche Gesellschaft fur CBTA Cross- Border Trade Agreement Internationale Zusammenarbeit CDC City Development Committee GMS Greater Mekong Sub-region CDF Constituency Development Fund GVB Gender-Based Violence CHDB Construction and Housing HARP-F Humanitarian Assistance and Development Bank (renamed Resilience Programme Facility Construction, Housing and ILO International Labour Organi6ation Infrastructure Development Bank) IPV Intimate Partner Violence CSC Citienship Scrutiny Card IRD Internal Revenue Department DAC Development Affairs Committee lZ Industrial Zone DACU Development Assistance Coordination JICA Japan International Cooperation Unit Agency DAO Development Affairs Organi6ation ROICA Rorean International Cooperation DALMS Department for Agricultural Land Agency Management Statistics LAMP Land Administration and Management DDA Department of Development Affairs Program DFID Department for International LAS Land Administration System Development LGU Local Government Unit DIIS Danish Institute for International LIS Land Information System Studies LMIC Low and Middle Income Countries DPD Development Partners LTO Large Tax Payer Offices DPW Department of Public Works LUC Land Use Certificates DOH Department of Highways LVC Land Value Capture DUHD Department of Urban and Housing MAC M yanmar Architect Council Development MCDC Mandalay City Development EDRB Engineering Department of Roads and . Committee Bridges MCDV Myanmar Comprehensive Development EM-DAT Emergency Events Database Vision EU European Union MDI Multidimensional Disadvantage Index FAO Food and Agriculture Organi6ation of MEB Myanmar Economic Bank the United Nations vi MES Myanmar Engineering Society PFMIP Public Financial Management MIMU Myanmar Information Management Improvement Plans Unit PPP Public-Private Partnerships MNBC Myanmar National Building Code SAR Special Autonomous Region MOALI Ministry of Agriculture, Livestock and SDG Sustainable Development Goals Irrigation SEE State Economic Enterprises MOBA Ministry of Border Affairs SLRD Settlement and Land Records MOC Ministry of Construction Department MOEP Ministry of Electric Power SNG Sub-National Governments MOHA Ministry of Home Affairs SOE State-Owned Enterprise MOLIP Ministry of Labour, Immigration and SUDP Strategic Urban Development Plan of Population the Greater Yangon MOREC Ministry of Natural Resources and SWM Solid Waste Management Environmental Conservation TDAC Township Development Affairs MPLCS Myanmar Poverty and Living Committee Conditions Survey TDR Transfer of Development Rights MRG Mandalay Region Government TVET Technical Vocational and Education MRT Mass Rapid Transit Training MTFF Medium-Term Fiscal Framework UAGO Union Attorney General Office MUSIP Mandalay Urban Services UCCRTF Urban Climate Change Resilience Trust Improvement Project Fund NCDP National Comprehensive Development UNFPA United Nations Population Fund Plan UNICEF United Nations International Children's NDMC National disaster Management Emergency Fund Committee UNISDR United Nations International Strategy NGO Non-Governmental Organi6ation for Disaster Reduction NLUP National Land Use Policy UNU-WIDER United Nations University - World NRC National Registration Certificate Institute for Development Economics NRW Non-Revenue Water Research NSDF National Spatial Development WHO World Health Organisation Framework YBPC Yangon Bus Public Company NSDI National Spatial Data Infrastructure YCDC Yangon City Development Committee NSDP National Spatial Development Plan YRG Yangon Region Government NUP National Urban Policy YRTA Yangon Region Transport Authority OECD Organi6ation for Economic Cooperation YUMRT Yangon Urban Mass Transit and Development YUTRA Comprehensive Urban Transport Plan OOPs Out-of-Pocket (Spending) of the Greater Yangon PCCD Pollution Control and Cleaning Department vii 妙1 C○NTEXT Urbaniろation in Mリanmarisstill in an earIg phasewith The report,Mganmarり排banI$atI&On:Crea亡ing slightlリless than one-third of the population Iiving in oppor亡unl&tie8 forAllaims to understand urbaniろation cities.This presents anenormous opportunitg forthe in Mganmar drawing on the growing Iiterature on countrg. Cities are engines of growth and prosperitg,the topic in Mganmar, especiallg for YQngon. It uses which facilitate industries to growjobs,services and an inclusive urbaniろation lens and proposes a set of innovations. Cities are also fundamental to lifting prioritg policg areas for urgent attention that will people out ofpoVertg through increased emplogment help to ensure the bene石ts of urbaniろation are wideig opportunitiesandincomestocitiろens. Nocountrg has realiろed given the projected growth of cities. An reached middle income status without urbaniろing. inclusion lens 15 particularlリimportant in Mganmar as the countrg transitions from a complex historリthat That being said,the wag that cities urbaniろe has been characteriろed bg decades ofeconomic and 15 importQnt to growth,p0Vertg Qnd IIVQbilitg. politicQI iSOIQtion,conflict,Qnd underdeVelopment. If adequate investrnents are not made in basic infrQstructure and services,urban planning,and in Inclusive urbaniろation 15 reliant on three keg ensuring a goVernance and 6nancing structure that dimensions;economic,social and spatial. Economic can deliverforresidents,cities instead can end upwith inclusionreferstoequitable accesstoemploリmentand mQjor problems of congestion,pollution,sprawl,and income-generating activities in a citg,and resilience inequalitg which can create or worsen social divisions,to shocks. Spatial inclusion refers to equitable and and potentiallg contribute to crime and violence. affordable access to Iand,housing,infrastructure and basic public services. Social inclusion relates to individual and group rights,equitg,securitg and dignitg. Such aspects of social inclusion and exclusion are relevant to groups who are often marginaliろed in daリーto-dag urban Iife. Viii MAIN FINDINGS AND KEY CHALLENGES Urbani6ation in Myanmar is steadily on the rise with Despite the positive benefits of growth, the increase approximately 30 percent of the population now in urban population has begun to put a strain on cities living in cites. Much of this is attributed to internal and the needs for affordable housing, infrastructure migration flows. In Yangon, for example, 81 percent and services. In Yangon, for example, only 33 percent of the population growth between 2009 and 2014 of the city's population have access to piped water, was attributed to internal migration. The majority of traffic congestion is on the rise, as is solid waste, migrants move to cities for employment. Other push flooding and pollution. There is also a rise in the factors of rural-to-urban migration include market number of informal settlements as new residents shocks, rural poverty, landlessness and natural cannot afford the existing supply of housing. If left disasters. unaddressed, these infrastructure needs will lead to further congestion, slums, pollution, and growing The robust growth in recent years has brought a inequality, putting a drag on opportunities for future decline in urban poverty from 32.2 percent in 2004/5 growth and poverty reduction. to 14.5 percent in 2015. The economic growth in cities has been fueled by an expansion in construction, services, and manufacturing. Yangon is the country's most dominant city and contributes approximately 25 percent of the country's GDP. ECONOMIC Economic inclusion in cities eludes many as they face challenges in the labor market related to: their lack of skills; high levels of informality; and discriminatory INCLUSION practices which particularly affect some subgroups. Levels of risk to natural ha6ards and economic shocks are high in Myanmar with the urban poor most acutely impacted. The lack of resilience to shocks affects their economic inclusion. S PAT IAL Spatial inclusion is a challenge given high land and housing costs (e.g.in Yangon) and the overall lack of basic infrastructure and services in cities. The needs for INCLUSION urban transport, water and sanitation, solid waste services, and drainage are substantial. The lack of affordable housing, especially in Yangon, means that many end up in informal settlements, particularly in periphery areas away from the central business district where many jobs are located. Conditions in informal settlements can be extreme with access to even the most basic services being limited or unaffordable when purchased through small scale private providers. This can have negative outcomes on health indicators and ability to increase income generation from home-based microenterprises further exacerbating exclusion SOCIAL Social inclusion is also challenging for subgroups -- in the case of urban areas in Myanmar, these have been identified as the urban poor, migrants, non-Bamar INCLUSION ethnic groups, religious minorities, women and the disabled. These groups often face exclusion from jobs, housing, and infrastructure and social services for various reasons. Beyond the precarious living conditions facing low income populations (many of whom are migrants), there are challenges related to legal documentation, tenure security and crime leave many at high risk. Given the high costs in cities, the urban poor often must seek loans in the informal sector to cover illness, other unforeseen events, or to make ends meet. A survey of poor households in Yangon found that 86 percent had taken such loans, with interest rates in excess of 20 percent. High levels of indebtedness are thus widespread and can perpetuate the cycle of poverty. Ilk4 Women may face security challenges in their subnational governments which presents an communities as reported in numerous studies, opportunity to better reach urban residents. In and disabled are often excluded in accessing basic practice, however, local governance is often hampered services. Ethnic and religious minorities also face duetolimitedimplementationofpolicies/frameworks, challenges in accessing identification cards which are financial resources, and technical capacities and is in important to social inclusion. much need of moderni6ation. These challenges result in inadequate service delivery and financing to meet Current structures of urban governance and growing needs on the ground. finance have evolved to shift a number of political, administrative and financial responsibilities to Approximately on 11> O0000% OO00- go000DOM- of Myanmar's population now reside in cities, much of which is due to internal migration flows xi ~~I PRIORITIES FOR INCLUSIVE, SUSTAINABLE AND COMPETITIVE URBANIZATION Given Myanmar's relatively early stages of urbani6ation, the policies and investments made today will shape cities for decades to come. Prioriti6ing an inclusive cities approach will help to ensure that cities grow in an equitable way, which will have significant benefits for livability, prosperity and competitiveness. The framework of economic, spatial and social inclusion points to several priority policy recommendations that can be implemented in the short, medium and longer term (See Table below). Many of the recommendations come back to the need for investments in: i) sustainable urban infrastructure and urban upgrading to provide basic services for all and ensure mobility for the flow of people, goods and services; ii) building resilience to mitigate the impact of shocks on the economy and on people's livelihoods and health; iii) facilitating access to legal documentation for migrants and specific subgroups, and targeting social programs for those that Taking these recommendations forward will require are particularly vulnerable to exclusion additional work to identify champions, find relevant and may not be able to benefit from entry points for private sector investment, and ensure urban opportunities; and a stable governance framework aligned with sufficient technical capacity and financing for implementation. iv) capacity building and new financing for These are challenges that the World Bank and other urban development. development partners can support in partnership with the Government of Myanmar. xii Indicative Time Frame: Short term (S): 1-2 years Medium term (M): 2-3 years Table 1. Priority Policy Longer term (L) 3-5 years Recommendations for Inclusive Urbani6ation in Myanmar CHALLENGE OUTCOME PRIORITY ACTIONS LEAD AGENCIES High informality Improve In-situ community based urban Development limits opportunities for upgrading (M) Affairs opportunities and informal workers begin identification of high risk Organi3ations links to exclusion areas, needs and upgrading plan (S) (DAOs)/ City * secure financing (S-M) Development * implementation (M-L) Committees (CDCs) Access to micro finance for small Ministry of entrepreneurs (M-L) Construction; * develop enabling environment and Ministry of incentives to foster micro finance Education; (M-L) Planning and * ensure gender equality in access Finance (M) Transport investments to enable mobility to jobs and markets (L) * Education and training for skills in urban jobs (L) * prioriti3e vulnerable groups (S-M) * investments in access and quality improvements (L) Some areas in Build resilience to In-situ community based urban DAOs/ CDCs cities highly natural ha6ards upgrading in high risk areas (S-M) Ministry of vulnerable to identify and prioriti5e investments Construction flooding and other (S) Ministry of natural ha5ards begin implementation (M) Social Welfare, Relief and Drainage/solid waste management Resettlement (M - L) * identify and prioriti5e highest risk areas (S) * implementation (M) Early warning systems (S) * design and implement approach to reach the most vulnerable (S) xiii Indicative Time Frame: Short term (S): 1-2 years Medium term (M): 2-3 years Longer term (L) 3-5 years CHALLENGE OUTCOME PRIORITY ACTIONS LEAD AGENCIES Prornotiny spatia inousion to improve access to affordable land, housiny and services for ow ncorne, and vulnerable populations Substantial Invest in equitable Infrastructure investments needed DAOs/ CDCs infrastructure access to in water, sanitation, roads, drainage, Ministry of deficits limiting sustainable urban solid waste management (M-L) Construction; successful infrastructure identify and prioriti3e needs with Ministry urbani3ation targeting of areas for greatest of Natural and contributing impact (S-M) Resources and to poor living ensure participatory design that is Environmental conditions gender, disabled-informed (S) Conservation begin implementation (M-L) (MOREC) Shortage of Improve and In-situ upgrading of existing stock and DAOs/ CDCs affordable expand affordable slum areas (M-L) Ministry of housing, large and housing diagnostic needs assessment and Construction; growing number development of affordable housing Construction of informal plan (S) and Housing settlements ensure target is for low income Development populations (S) Bank (CHDB); * create enabling environment for Ministry of housing supply and demand (M) Planning and * develop approach to incentivi5e Finance private sector for low income market (S-M) * implementation (L) Implement the National Land Use Policy (S-M) * enable and train staff for implementation (S-M) Limited urban Improve Align plans across agencies (land use, DAOs/ CDCs planning results integrated spatial transport, environment, disaster risk) Ministry of in congestion, planning for (S) Construction sprawl, ha5ard inclusive and set up coordination mechanism (S) Ministry of risk, inequality, resilient urban invest in geospatial data and sharing Social Welfare, and can affect development platforms (e.g. plan for national Relief and city growth spatial data infrastructure) (S) Resettlement opportunities Ensure planning is gender and disability -informed Capacity building (M-L) * identify needs and develop longer term strategy (M) * implementation (L) xiv Indicative Time Frame: Short term (S): 1-2 years Medium term (M): 2-3 years Longer term (L) 3-5 years CHALLENGE OUTCOME PRIORITY ACTIONS LEAD AGENCIES Promotiny socia incusion to improve conditions for vulnerable yroups to full participate in society Some are not able Target social Targeted programs designed to: link DAOs/ CDCs to fully participate programs to migrants with job opportunities, and Ministry in job markets or marginali3ed provide assistance for disabled (M) of Labor, access services groups identify and prioriti3e needs (S) Immigration and (migrants, ethnic program design, implementation (M) Population; groups, disabled, Ministry of women) Addressing gender and other Social Welfare, discrimination (S-M) Relief and * awareness raising, education (S) Resettlement * policy reform (M) Lack of Facilitate Reform of identification card system DAOs/ CDCs documentation access to legal to ensure equity and remove obstacles Ministry and identification documentation linked to migration status (M) of Labor, can prevent identify equitable approach and Immigration and citi5ens from design system (S) Population; accessing jobs, implementation (M) Home Affairs services. Ensurng good governance and fnance for urban development sfundamentai to creating incusive, comnpet tive and sustainobie aities Fragmented Strengthen Streamline processes for urban * DAOs/ CDCs governance coordination management, delivery (S) * Relevant hampers decision between * carry out diagnostic assessment sectoral making and government of processes and develop Ministries improvements on agencies for recommendations for efficiency for the ground. decision making core urban services (S) and urban * implement changes in a phased management manner (S-M) Hori5ontal and vertical coordination needed (S-L) * carry out institutional mapping and assessment for core agencies and recommend reforms (S) * implement changes in a phased manner (M-L) Invest in capacity building for implementation (M-L) xv Indicative Time Frame: Table 1. Priority Policy Short term (S): 1-2 years Medium term (M): 2-3 years Recommendations for Inclusive Longer term (L) 3-5 years Urbani6ation in Myanmar (Continue) CHALLENGE OUTCOME PRIORITY ACTIONS LEAD AGENCIES Ensurng good governance and inane for urban developrnent i fundarnentai to creating incusive, competitive and sustainabie cities Urban plans and Strengthen Engage communities and citi3ens to DAOs/ CDCs programs can be participatory help to promote inclusion (S) Ministry of disconnected from planning for urban mainstream participation in urban Construction citi3en's needs. development planning and program design (S) * train relevant staff (S) * ensure low income communities are included (S) Strengthen Develop a holis- Utili5e intergovernmental fiscal * Ministry of participatory tic and equitable transfer mechanisms to equalie Planning and planning for urban approach to fi- regional disparities (M) Finance; development nancing for urban * diagnostic work to identify approach * Ministry of development for reform (S) Commerce * implementation (M) Strengthen local revenue generation (M - L) * diagnostic work to develop proposals for increasing property tax revenues (S) Allow more local discretion over funds use (S) * Develop transparent decision making and implementation process (S) Scale up private sector financing through improvements in enabling environment (M-L) * Address existing bottlenecks through reform (M-L) * Invest in capacity building (S-M) Explore use of Land Value Capture for larger cities (S-M) * Carry out diagnostic work to identify key opportunities (S) * Implementation (M) xvi '«is 1�:� i , � п " . . .'. 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J у `^. а ы Г .'i�: � } �� '" ^ ' � �+�' � I ц - _ ' '4. ! � . � - °_� j �'G `'r- - �7 '-� �� �"�.�� - �� У�Т - r - И.: ii ��' � - � � � ---"� �� т _ r + �+ 1 �.1.> - ' �. "� Г� � . ' _ �' `+ - � Ф ' � =� _ � � -� - �. i �.� �-,� � !" �� tY� � ь е- - � Yi "� . ' �[ ' �:... .. _ 7 r� , f✓� .. . �.,г � � � � г .i-r� ,M1 . � ,,�}�ь +� _ ------ � '�-. ..� ��+ �7� � .`�'^7 �--- ,:� " � -" а �, ; �- . � � ���, . �- � �, �\ �Я ~�~ �.%" _ _ 1;�. .- .. � ,� . � �-� � ..N ��� f� . --.J� � ��� Т � ,- ," ��; 3, i гSд� i � , , . j � п � � ,. - - � t 'ч �,�_ � � ��.� � � IIII _ _ - � о �,,, �. ,;� ���. ��-� _ � i�{ : �#, ��t � Сл ` l � � � ;i � }���� � !� �� �. � � �.. �� . . �>... ;� е � � ь% ��. в � 1 . � � � � � � � � � KEY MESSAGES " Urbani5ation in Myanmar is currently at 30 percent and growing steadily, driven mainly by migration, 43 percent of that to Yangon (2009-2014). " The growth in cities can bring many opportunities foriob creation and poverty reduction. Strong growth of over 8 percent between 2004-2015 brought reductions in urban poverty from 32 percent in 2004/5 to 14 percent in 2015. However, if not well planned and managed, urbani5ation can result in growing congestion, sprawl, slums, pollution and rising inequality which is now emerging in Yangon. " In Myanmar, due to deep rooted patterns of exclusion over time, several groups in cities face barriers that limit their ability to fully contribute and benefit from urbani5ation. POLICY RECOMMENDATIONS " An inclusive approach to urbani5ation is especially important for Myanmar given its history. Policy priorities are related to three dimensions of inclusive urbani5ation-economic, spatial and social - and can promote more equitable and sustained growth, social cohesion, and livability. " Implementing such an approach will require a deepening of reforms and strong commitment from different levels of government and other key stakeholders. 1.1 INTRODUCTION Myanmar is going through a structural transformation have resulted in a transition from a planned to an open and has enormous potential for growth, given its market economy, from military to civilian rule and strategic location linking South Asia, Southeast from conflict to peace. There have been immediate Asia and China, as well as its rich natural resources. and positive impacts on growth and poverty Growth has been strong, averaging over 8 percent reduction, though deep-seated patterns of social, between 2004 to 2015, and the national poverty rate economic and political exclusion for many subgroups has declined steadily during the same period, from in the population remain and will be a great challenge 48.2 percent in 2004 to 32.1 percent in 2015. That to the sustainability and deepening of reforms. The said, its per capita GDP of $1,275 in 2015 is among the achievements of this decade are at risk if policies to lowest in the region. Human development indicators promote inclusion are not prioriti6ed. Such risks can such as infant mortality and life expectancy are also be particularly acute in cities where the density of still on the lower end of the spectrum. people -- often from different socio-economic, ethnic, and religious backgrounds -- is higher, as is inequality. With approximately 30 percent of its population living in cities in 2017, Myanmar is still considered as International evidence on transitions out of conflict, being at an early stage of urbani6ation, with a level as discussed in the World Bank's World Development of urbani6ation below that of Lao PDR (34 percent) Report 2011: Conflict, Security, and Development, and Vietnam (35 percent), but higher than Cambodia highlights the importance of social cohesion (23 percent). At 1.7 percent in 2017, the annual urban policies that 'create a sense of fairness and social population growth rate is lower than that of other justice across population groups' and 'foster the countries in the region. However, in tandem with participation of hitherto excluded groups or areas economic growth, the country is expected to continue in economic and political decision-making, enabling to urbani6e, with a projected increase to 35 percent them to benefit from development assistance' (World in 2050 - an estimated increase of 9 million people in Bank, 2011). A more recent report, the World Bank cities by migration alone.2 and UN's Pathways for Peace: Inclusive Approaches to Preventing Violent Conflict report emphasi6ed the As experience in other countries has shown, extent to which a sense of fairness and social justice urbani6ation will be important to continued growth across population groups helps maintain peace and and poverty reduction in Myanmar. Globally, over prevent violent conflict, and provides an overview 80 percent of economic activity is concentrated in of the existing studies linking social inequality and cities. Urban areas are essential for lifting people out conflict in countries. of poverty through the opportunities that density can bring with jobs, services and innovation. A In this context, a focus on inclusive urbani6ation key element that will help drive the success of this for Myanmar will be critical. Policies that promote urbani6ation process is ensuring that it is inclusive. inclusive urbani6ation can bring shared prosperity, This is particularly important in Myanmar given enhance cities' productivity and competitiveness, and its transition from military rule and its associated enhance social cohesion and livability. Yet if cities are challenges, including an ongoing peace process with not well-planned and well-managed, urbani6ation can multiple ethnic groups, a long history of exclusion of lead to higher levels of poverty and inequality, which some groups to land and labor markets, services, and can affect a city's competitiveness, undermine socio- spaces that affect social and political life. economic benefits, threaten sustainable growth, and result in social divisions, violence, and conflicts. The country has faced several decades of civil conflict Exclusion of subgroups, a lack of trust in institutions, and tight military rule. Those conflicts had severe lack of transparency, and inability to meet growing impacts on people's lives, created deep divisions, needs of residents, particularly in a dense urban and diverted resources from the provision of public environment, can exacerbate tensions and social services. The democratic reforms beginning in 2011 strife. 1 World Bank Open Data. https://data.worldbank.org/, accessed on 24 September 2018 2 United Nations Department of Economic and Social Affairs/Population Division 15. (2014). World Urbani6ation Prospects: The 2014 Revision 3 Inclusive urbani6ation is reliant on three key This report seeks to understand some of the key dimensions; economic, social and spatial.' Economic issues related to inclusive urbani6ation in Myanmar inclusion refers to ensuring opportunities for all in and proposes a set of priority policy areas that will be contributing to and sharing in rising prosperity. Spatial importantto ensure the benefits of urbani6ation are fully inclusion refers to improving access to affordable reali6ed given the projected growth of cities. The report land, housing and services for all. Social inclusion draws on numerous studies that have been carried out involves improving the terms for marginali6ed groups in the past few years by donors and other development to take part in society. In the case of urban areas in partners related to specific aspects of urbani6ation. It Myanmar, marginali6ed groups are identified as the is intended to present a broad overview of key issues, urban poor, migrants, non-Bamar ethnic groups, though the examples and data are particularly focused religious minorities, women and the disabled, who on Yangon and to some extent Mandalay due to the face exclusion from jobs, housing, and infrastructure availability of information on these larger cities. There and social services for various reasons. These groups are many areas that would benefit from further in-depth are not mutually exclusive, for example the proportion analysis, particularly using primary data analysis which of migrants is higher among the urban poor than non- was beyond the scope of this report and are proposed poor. for future analytical work (see Box 1.1 on available data and Section 6.6 on areas for future work). The three dimensions of inclusion are hig hly interlinked, and any approach to understand the complexity of This chapter provides an overview of urbani6ation issues or develop solutions must consider all three. trends in Myanmar. Chapter 2 briefly covers issues For example, challenges in accessing income earning of economic exclusion while Chapter 3 looks at opportunities may be linked to macro level problems the multiple aspects of spatial inclusion, including in the economy and structural problems in the labor a review of key sectoral issues. Chapter 4 covers market, but also may be linked to where people live social inclusion, Chapter 5 discusses issues around and the possibilities for affordable transport to jobs governance and finance and Chapter 6 provides a and markets, limited basic infrastructure for home- discussion on priority recommendations for inclusive based work, and/or exclusionary policies or social urbani6ation. practices for some groups that are discriminatory. Figure 1.1: Multi-dimensional Framework for Inclusive Cities Spatial inclusion: Improving access to affordable land, housing and services for all Social Economic inclusion: inclusion: Improving Ensuring the terms for opportunities for vulnerable groups all urban residents to take part in to contribute to society and share in rising prosperity Source: Adapted from World Bank 2015 3 This draws on the framework developed in World Bank, 2015, World Inclusive Cities Approach Paper, World Bank Report AUS8539, Washington, DC 4 Box 1.1: Analy5ing Urban Development in Myanmar: Data Resources A common challenge with urbani5ation studies is group, characteristics and living conditions for the lack of quality data that can be disaggregated the poorest can be similar to rural areas, masking at a level that is meaningful at the urban level, important information about conditions. and particularly within cities. Most surveys capture statistical representation at the urban In the case of Myanmar, a number of rich data level only, and not by cities with the exception of sets have recently become available and have the largest city. This makes it hard to understand provided the basis for many important studies differences between or within cities which can be which were utili5ed in the preparation of this vast. As an example, overall urban development report. Among the key data sets and their urban indicators tend to be higher in cities than in rural coverage are the following: areas. However, when disaggregated by income Table 1.1: Data Sources YEAR DATA SOURCE COMMENTS Surveys 2014 Myanmar Key demographic and housing indicators, full Population and representation down to the ward level. Further primary Housing Census analysis is possible and would be insightful for urban studies. 2015 Myanmar Poverty Sample survey of living conditions, can be used to describe and Living the national, urban/rural and agro-ecological 3one level. It Conditions Survey cannot be used at the state and region level. (MPLCS) 2015 Labor Force Survey, Large sample (23,000) of workers nationwide, for each International Labor State / Region /Union Territory (SNGD), rural and urban Organi3ation: areas were treated as separate basic strata thus can be disaggregated 2017 Myanmar Living Key indicators of living conditions, representative at the Conditions Survey Union Territory, states and regions, urban and rural areas Geospatial data 1975,1990, Global Human Globally available raster dataset produced by the Global 2000, 2014 Settlement Layer Land Cover Facility. Uses Landsat imagery and a machine- learning algorithm to identify built-up land across four time-periods. Useful for measuring long-term urban growth Yearly (2017 Landscan Global population distribution raster at 30m resolution. most recent) Created by Oak Ridge National Laboratory by using a combination of census and geographic data, as well as remote sensing analysis techniques. Helpful in areas where population figures are difficult to find DMSP 1992- Nighttime Lights Global nighttime lights data published by the National 2012, VIIRS Oceanic and Atmospheric Administration (US). Is a good 2012-2018 measure of urban change and has been used as a proxy for GDP 5 URBANIZATION IS STEADILY ON migration (Ministry of Labour, Immigration and THE RISE Population, 2016). Analyses carried out on 2014 census data links increased migration to urban areas The urban population in Myanmar has increased with economic and political liberali6ation in 2010/11 gradually, from 24.7 percent in 1987, to 30.3 percent (Ministry of Construction, 2016). In addition, migrants in 2017.4 Approximately 15 million people now live in have displayed a higher level of employment in the urban areas, with Yangon and Mandalay accounting industrial sector than non-migrants, indicating that for 20 percent of the total urban population, the search for better economic opportunities is a key Myanmar has a relatively low level of urbani6ation driver of domestic migration. at 30 percent, but this is expected to change given Other push factors of rural-to-urban migration continued economic growth. By 2050 it is estimated that 35 percent of the population, with much of that ind ar ural pe, Anessness 5 and natural disasters. For example, the Ayeyarwady urban growth to happen in Yangon.5 Region, a poor agricultural region struck by Cyclone Much of the population increase in cities is driven Nargis in 2008, has lost 784,919 people or 13.2 by internal migration.6 It is estimated that nearly percent of the region's total population to neighboring 10 million people in Myanmar are not living in the Yangon (Ministry of Labour, Immigration and township where they were born, equivalent to 21.6 Population, 2016). Pull-factors can range from better percent of the population (2014 Census). Urban areas living and working conditions, wider access to public in Myanmar have received the bulk of recent migration services and job opportunities, to higher salaries, and flows. In Yangon, 81 percent of the population growth stabili6ed political situation. between 2009 and 2014 was attributed to internal Figure 1.2: Share of Urban Population, EAP countries China Indonesia Thailand Philippines Vietnam Lao, PDR Myanmar Cambodia 0 10 20 30 40 50 60 70 Source: World Bank, World Development Indicators, 2018. Based on country census data 4 Myanmar, 2014 Census 5 UNFPA, 2017, Mynamar 2014 Census, Thematic Report on Population Projections 6 International migration is considered to be relatively lower. 75% of migrants have relocated to other places in Myanmar (Census, 2014) 6 Box 1.2: Internal Migration Patterns in Myanmar Recent analysis using the 2014 Census shows that 6ones in other parts of the country - Mandalay, most internal migration is towards urban areas Ayeyarwady, Bago, Magway, Mon, Sagaing, Shan given the driving motivation for work. Over half and Tanintharyia - also attract workers (MOLIP of internal migrants moved to cities; 43 percent and UNFPA 2016). ended up in Yangon from 2009-2014 and another 12.5 percent in Mandalay (Table 1.2). Among the A second notable pattern is the high in-migration top 20 district-to-district migration corridors, 19 to states that are located in strategic economic end up in Yangon and of those, the largest share areas on the international border and along end in Northern Yangon, the district with the economic corridors. Districts that borderThailand highest proportion of manufacturing jobs (MOLIP (Myawady, Tachileik and Katwthoung), India and UNFPA 2016). Interestingly, 7 of these flows (Tamu and Hkamati) and China (Muse) report are movements within Yangon, and another 8 high rates of net in-migration (MOLIP and UNFPA are from neighboring Ayeyarwady. Industrial 2016). Table 1.2: Internal Migration, Top 20 District-to-District Flows for Recent Migrants, 2014 Rank District to District flow Number of migrants 1 West Yangon to East Yangon 56,601 2 Phayapon to North Yangon 51,086 3 West Yangon to North Yangon 43,044 4 Hinthada to North Yangon 35,311 5 Maubin to North Yangon 33,369 6 Labutta to North Yangon 29,796 7 Thayawady to North Yangon 29,362 8 North Yangon to East Yangon 28,368 9 Pathein to North Yangon 27,852 10 East Yangon to West Yangon 26,257 11 East Yangon to North Yangon 25,652 12 Phayapon to East Yangon 24,891 13 South Yangon to North Yangon 24,660 14 Myingyan to Mandalay 24,500 15 Myaungmya to North Yangon 21,694 16 Bago to East Yangon 20,907 17 Bago to North Yangon 18,663 18 North Yangon to West Yangon 17,519 19 Magway to North Yangon 16,231 20 Pathein to East Yangon 14,835 Source: MOLIP and UNFPA, 2016 Source: Cunningham, W. and Muno6, R, eds., Myanmar Future Jobs: Embracing Modernity, Main Report and Background Reports, World Bank, 2018. Background paper, Internal Migration, Wendy Cunningham, Alehandro Huertas Harry Moro, and Mauro Testaverde with inputs from Soonhwa Yi 7 Urbani6ation thus far has brought reductions in is not available but would be insightful to understand urban poverty, with a substantial decline from 32.26 spatial aspects of inclusion. percent in 2004/5 to 14.5 percent in 2015.1 Other indicators of welfare, such as ownership of assets, also show improvements with particular increases in YANGON DOMINATES IN SIZE AND the ownership of smart phones (now at 87.3 percent ECONOMY in urban areas), televisions, cars, air conditioners, etc.' This is largely attributed to growth in the service sectr, nd t soe etentmanfacurin, wich Yangon is currently the country's most dominant iseclikelyn to have positvelt impactdutrincme city, driven by economic development given its role is likely to have positively impacted the income astecm rilanfnnilcptlofM na. as the commercial and financial capital of Myanmar. generating opportunities of the urban poor more than With a population of over 5 million people in the city the rural poor. Growth in the construction sector and and 7.4 in the wider metropolitan region, Yangon in manufacturing has been predominately focused in is significantly larger than the country's second urban and peri-urban areas. largest city, Mandalay (1.22 million), and contributes approximately 25 percent of the country's GDP. Urban inequality is higherthan in rural areas, with a Gini Over 90 percent of g coy m e Po coefficient of 38.6 in 2015 (as compared to 28.3 in rural . areas).' This is not an unusual pattern, but cause for industry and services. While the transfer of national attention as urbani6ation increases, particularly given government functions to the new city of Na Pyi Taw has diverted some activity from Yangon, the city is the potential links of inequality and social tensions in expeted om e couty majo ura ceter. cities. Information on intra-city patterns of inequality Figure 1. bewso the dstributioof urban Figure 1.3 below shows the distribution of the urban population by township. Figure 1.3: Share of People Living in Urban Area by Township Legend M kUrbanisation (%) 0-10 10 - 20 20-30 30 -40 40 -50 50 -60 . ................................ .6 0 - 7 0 70-80 80-90 - 90-100 Source: 2014 Census 7 MPLCS 2015 and 2017, World Bank Poverty Report. Estimate based on World Bank methodology 8 2017 World Bank Poverty Report 9 Data on trends is not available 8 Table 1.3: Proportion of Population in Urban Areas by State/Region State/ Region Total Population Urban Population % Urban % of Total Urban Population Rachin 1,642,841 592,368 36.1% 4.0% Rayah 286,627 72,418 25.3% 0.5% Chin 478,801 99,809 20.8% 0.7% Sagaing 5,325,347 911,355 17.1% 6.1% Tanintharyi 1,408,401 338,419 24.0% 2.3% Bago 4,867,373 1,072,336 22.0% 7.2% Magway 3,917,055 588,031 15.0% 4.0% Mandalay 6,165,723 2,143,436 34.8% 14.4% Mon 2,054,393 572,189 27.9% 3.8% Rakhine 2,098,807 354,288 16.9% 2.4% Yangon 7,360,703 5,160,512 70.1% 34.7% Shan 5,824,432 1,395,847 24.0% 9.4% Ayeyawady 6,184,829 872,600 14.1% 5.9% Nay Pyl Tow 1,160,242 375,189 32.3% 2.5% Union 50,279,900 14,877,943 29.6% 100.0% Source: Adapted from Myanmar Ministry of Labor, Immigration and Population (2015) The 2014 Myanmar Population and Housing Census - The Union Report Urbani6ation was accompanied by a modest rate of The increase in urban population has begun to put a spatial expansion in urban areas between 2000 and strain on cities and the needs for affordable housing, 2010, with an average additional 40m2 of land area infrastructure and services. In Yangon, for example, per additional urban resident (World Bank, 2015) In only 40 percent of the city's population have access Yangon, this figure was only 24m2, suggesting that to drinking water, traffic congestion is on the rise, as new urban residents were accommodated either is solid waste, flooding and pollution. There is also through higher rates of occupancy in existing homes, a rise in the number of informal settlements as new higher density developments, or informal settlements residents cannot afford the existing supply of housing. with little accompanying infrastructure (Ministry of If left unaddressed, these infrastructure needs will Construction, 2016). More recent mapping shows the lead to further congestion, slums, pollution, and put city expansion through 2014 (Figure 1.4) a drag on opportunities for growth. These issues are discussed in detail in Chapter 3. 9 Figure 1.4: Urban Expansion, Yangon, 1975-2014 Year 2014 2000 1990 1975 Yangon Source: World Bank calculations using Global Human Settlement Layer (GHSL) Data 10 r - i~Pi b be `iA1 p 1p &Ss . ýsý0 KEY MESSAGES * Urbani5ation is creating new employment opportunities manufacturing and services, particularly in Yangon and Mandalay. The service sector now dominates, accounting for approximately 40 percent of GDP. * The job creation is not benefiting everyone due to: skills shortages, high levels of informality, and discrimination for some. * Risks in cities from natural ha5ards and economic shocks affect economic inclusion particularly for the urban poor. POLICY RECOMMENDATIONS * Invest in improvements in education for all as well as conditions in the labor market and macro economy to create jobs and growth. * Improve opportunities for informal workers, particularly vulnerable groups, through urban upgrading, access to micro finance, transport investments to enable mobility, and education and training for skills in urban jobs. * Build resilience to natural ha5ards through urban upgrading and drainage and solid waste management in high risk areas, as well as through early warning systems that reach vulnerable communities. 2.1 INTRODUCTION Cities are hubs of economic activity and generate economic inclusion, particularly if mechanisms for demand for a variety of services. As such, urbani6ation resilience do not exist, as its typically the case for the has the potential to bring economic opportunity urban poor and many new migrants (Baker & Gadgil, for many. Standards of living have increased more 2017). rapidly in cities than in rural areas, and employment has been a driver of economic growth and social In the case of Myanmar, urban development is cohesion (World Bank, 2017b). In Myanmar, urban providing economic opportunities particularly in the areas have averaged an annual growth of 1.9 percent, larger cities. Industrial 6ones - a total of 19 existed which is 0.8 percent higher than that in rural areas across Myanmar in 2015 - have created jobs. Yet at (World Bank, 2017a). the same time, these jobs are not always accessible to urban residents for various reasons discussed At the same time, promoting economic inclusion below - lack of skills, informality, or discrimination -, in cities is reliant on equitable access to jobs and the vast majority of people work in the informal and income-generating activities. Low-income sector. Working in the informal sector can bring much populations are generally reliant on cash incomes, uncertainty and risk to individuals and households are highly vulnerable to employment losses and wage given the lack of stability and social protection and reductions in urban-based industries, and do not have can contribute to economic exclusion for vulnerable agricultural production to fall back on as they would groups. in rural areas. External shocks can also impact their 2.2 URBAN GROWTH CENTRES AND ECONOMIC OPPORTUNITIES Myanmar's economy is transitioning from agriculture value chains in Myanmar and the region. Border trade to other sectors, many of which are urban-based. The and connections with international activity provide positive effect of urban agglomeration drives local economic opportunities. Border trade is expected economic growth in the city by not only providing to increase as Myanmar economically develops diverse employment opportunities but also reducing and imports more goods, and neighboring countries trade cost, improving productivity, and facilitating (especially China) move more toward the hinterlands export-oriented industries due to the nearby ports. (Rahardja, Artuso, & Cadot, 2016). In 2015, the service sector became the dominant sector accounting for almost 40 percent of GDP. The The Yangon Region, with 13 percent of the total growing manufacturing industry contributes to the population in Myanmar, produces and estimated rest of 28.4 percent (World Bank, 2017b). 20-25 percent of the country's GDP and it seeks to diversify its investment opportunities to other sectors, The country is part of the Greater Mekong Sub-region such as tourism, services, and logistics. Other growth (G MS), which, established in 1962, also includes centers include Mandalay, for its' role in regional trade member counties Cambodia, Laos, Thailand, Vietnam, and logistics for Northern Myanmar and link to the andYunnanProvinceandGuangxiSpecialAutonomous Belt and Road Initiative, and Nay Pyi Taw because of Region (SAR) in southern China. An Economic Corridor its role as the capital. Secondary cities also have an development and Cross-Border Trade Agreement important role to play and would benefit from more (CBTA) strengthens regional market integration and detailed analysis. 13 Figure 2.1: Growth Centers Figure 2.2: Population with Access to Corridors * I ti I Source: International Growth Center, 2016 2.3 EMPLOYMENT IN URBAN AREAS Urbani6ation and the recent rapid growth of Myanmar Urban workers work an average of 53 hours each have created much employment in sectors such as week, considerably higher than the national average manufacturing, construction, retail and wholesale, of 40 hours (MPLCS, 2015). Unemployment overall and hotels and restaurants. Overall employment in Myanmar is very low in Myanmar (MPLCS, 2015). levels in urban areas are high, estimated at 78.2% Of those not working, they are engaged in full-time for men and 53.5% for women (World Bank, 2017a). housework (12.0 percent) or several other activities in This rate is higher than in 2005 for every age group, the year prior to the survey, primarily being a student, with the greater increases seen for women, though retired, or suffering from a disability. The reasons their overall rates are still lower than men. According for inactivity vary by characteristics: the elderly are to the Asia Foundation's inaugural City Life Survey, retired, very young are in school, prime-aged workers urban women and men in Myanmar have equal levels are ill or disabled and could not work, and men are of education, but women are almost twice as likely waiting for the busy (agricultural) season. Urban than men to not be employed and not be seeking employment has a significant gender division as employment (Asia Foundation, 2017). women are more likely to be responsible for housework 14 and childcare. Only 5 percent of women surveyed in professional occupations. (World Bank, 2018 reported doing no housework or having no childcare Myanmar Jobs Report). duties, compared to 19 percent of men. In addition, 14 percent of women spend between 11 - 15 hours a day Yangon and Mandalay are where many of the existing on domestic labor, compared to just 3 percent of men formal jobs with firms are concentrated. These (Asia Foundation, 2017). two cities represent about a third of all firms in the country, but more than half of the number of formal Despite the high employment rate and long hours sector workers (60 percent), and 50 percent of total worked, most of the jobs are low-productivity and value-added and capital owned (Myanmar Economic low-paid jobs in household enterprises or small Monitor, 2018). This high concentration is especially firms. For those working in unskilled jobs, many only prevalent in manufacturing jobs, where Yangon require simple, mostly manual tasks, such as street represents 47 percent of all jobs, and Mandalay 16 vendors, care and maintenance of homes or buildings percent. Most of the very large firms are located in (World Bank, 2018). Wages are very low and jobs Yangon given the concentration of industrial 6ones are overwhelmingly in the informal sector which can and more established infrastructure, particularly present significant challenges affecting economic electricity. inclusion. Yangon has an estimated 30 industrial 6ones, many of The formal modern sector only accounts for 11 percent which are located in North Yangon which is the most of total jobs in Myanmar, similar to other countries popular destination for internal migrants employed who have gone through structural transformation in manufacturing'o. Despite the availability of some periods such as Vietnam, but the number is still very job opportunities, high rents prevent migration to the limited. Only three percent of Myanmar's workers central business district (CBD) in West Yangon while are classified as professionals, managers, skilled moderate migration is happening in East Yangon with technicians or associate professionals. and only lower rents. The largest IZ of Myanmar is located 13 percent of Myanmar people with a high school in Hlaing Taryar township in north Yangon which education or above work in professional occupations. employs hundreds of thousands of workers. Women are three times as likely as men to be engaged Figure 2.3: Firms in Industrial Zones 73% Yangon 58% 44% 13% Mandalay 10% 14% - 14% Rest 32% 43% 0 500 1000 1500 2000 2500 U Large Medium Small Source: Tim Dobermann. (2016). International Growth Center Policy Note on Urban Myanmar Note: from Robertson & Seng Taung (2015) and DISI. Small 'industrial' firms are between 10-15 workers, often family owned 10 Department of Population Ministry of Labor, Immigration and Population. (2016). Thematic Report on Migration and Urbani6ation 15 Some lZs, however, are not operating at their full the most frequent response (by 17 percent of the capacity and the majority of manufacturing activities firms). Other obstacles included access to finance in lZs, such as textiles and food processing, remain (15 percent) and poor power supply (14 percent) at the lower end of the value chain. While some lZs (Economic Survey, 2016). A second survey asked attract firms, some struggle with low rates of active employers about difficulties in hiring, here too lack of business activities due to limited demand in opening or skills was rated highly across a range of job types. scaling up lZs, economic fluctuations, failure of other firms that undermines new business from opening, Overall skills levels are low in Myanmar which is a rising cost of living, and rampant land speculation in major deterrent to entering the labor market and lZs (Robertson and Taung, 2015). As a result, the lZs to economic inclusion. Half of Myanmar's workers have not offered adequate employment opportunities did not reach middle school. Twenty percent said to the large influx of migrants, and thus access to that they never attended school (or only attended formal, well-paid jobs remains limited. monastic schools) while another 39 percent did not complete primary school. Only 21 percent had a high There are a number of constraints affecting access school education or above (MPLCS, 2015). to better jobs particularly for vulnerable groups, in particular, skills shortages, informality, and Among the more vulnerable groups, there are several discrimination which are discussed below. specific factors that prevent higher educational achievement and skills development (though not specific to urban areas). For the poor, children dropout THE LACK OF SKILLS IS HINDERING because they need to enter the labor market. For the BETTER JOBS disabled studies show that children living with one or more disability have much lower rates of enrollment A major obstacle cited by firms is skills. When firms in education than those without. Even if enrolled, were asked about the top obstacle they faced in discrimination in school can cause children living with disabilities to drop out (Eden Center for Disabled conducting their business, from the list of 15 different Cide,21) obstacles, "inadequately educated workforce" was Table 2.1: Employer Difficulties in Hiring, 2016 (%) Manager or Semi-skilled Skilled Unskilled senior level non- production production professional production worker worker There were no or few applicants 52 64 42 50 Applicants lacked required job-specific 76 78 79 72 skills Applicants lacked required personal skills 77 82 86 79 or behaviour Applicants expected higher wages than 78 76 45 62 the establishment can offer Applicants did not like the working 55 39 54 44 conditions Source: Cunningham and Huertas (2017) 16 INFORMALITY IS HIGH WHICH microenterprises are in manufacturing (26 percent) CONSTRAINS INCLUSIVE GROWTH and industry (18 percent). Very few micro enterprises have links with the formal sector or organised traders. The largest share of the population in cities, particularly the poor who typically have low t es coMml cited acle by ic educationalattainmentandskills,workintheinformal enterprises in Myanmar is limited access to finance sector. A 2017 survey of Myanmar's Micro, Small and (Mc anas ow tat limited acesrt Medim Eterpise esimatd tat pproimaely finance and lack of adequate capital is a severe Medium Enterprises estimated that approximately polmfrsaladmdu im.Psil 95 percent of workers have no contracts, and that polmfrsaladmdu im.Psil inforal. eploymntes he o common form explanations include lack of proper collateral, limited informal employment was the most common form of orncedthsryifrminaaymtyabu work among Myanmar's manufacturing enterprises credit hisry, informal asymetry au (Ministry of Planning and Finance and UNU-WIDER, crdtwthns,adifmlcoetosad t opayments required to obtain a loan. This is consistent 2017). Working in the informal sector can present with a random sample of unregistered firms in large challenges to inclusion as wages tend to be lower than the formal sector, and informal workers typically do cities n M nma fond tate bigest reporte not have social protections, labor regulations are often obstace nf s access to fin (36 percent), access to land (20 percent), corruption, not adhered to, and there is increased vulnerability crime, electricity supply, water supply, access to to external shocks and exploitation (Baker & Gadgil, technology, and lack of skilled workers. 2017). It is estimated that about 80 percent of the urban As in other developing countries, the widespread and persistent informal economy in Myanmar plays an workforce is employed in micro enterprises compared iprtnt rolerin proiding jb an ringin with a much lower 49 percent for rural areas (MPLCS). Almost half, 43 percent, of the micro enterprises in for the poor and will require more policy attention urban areas operate from home which means that to maximi6e its contribution to employment and the . overall economy affordable and reliable access to infrastructure and y services is not only important to living conditions, A survey in three periphery townships of Yangon found but also to livelihoods. Frequent power outages that the majority (82 percent) worked as casual labors, affect almost 90 percent of the micro enterprises street vendors, trishaw drivers, and bricklayers. Half with consequent impact on productivity, and access to roads, water, and sanitation are also important. oe dors earnedlles tha 3,000 ya (U ,208 Twenty percent of urban firms operate from a yper day. While a skilled bricklayer could earn 10,000 traditional market or from a shop in a commercial area.11 4,000 Ryat (US$3.44) per day. About 40 percent of working households under the survey earned between About 60 percent of micro enterprises are female 5,000 and 10,000 Kyat (US$4.3 and US$8.6) per owned, and approximately 25 percent of the day, but many such jobs were only seasonal. During immigrants own a micro enterprise (compared with 17 the monsoon season, income of vendors, construction percent of the non-immigrants). The mean monthly workers, and trishaw drivers was much reduced income of workers in micro enterprises is 78,132 (YCDC and Save the Children, 2016). Ryats, which is below minimum wage and poverty line. Most of the micro enterprises are in the service sector (63 percent in cities), about 25 percent of all firms are in street and related sales service, 20 percent in food processing, woodworking and garments; and 20 percent in hospitality, retail and other services. Other 11 Mohammed Amin, 2018, Background paper on Micro enterprises, to Cunningham, W. and Munog, R, eds., Myanmar Future Jobs: Embracing Modernity, Main Report, World Bank, 2018 17 Figure 2.4: Top Obstacles Faced by microentrepreneurs in Myanmar, 2015 Cn 0) Cn _ 50% t Sa 45% o 0 .n I0- E ~40% 35% 4- 4-' C o" 30% Cao _ 25% '- a 4 20% 0 15% 00 2 10% No problem Lack of Difficulty Fluctuation Irregular Customers Inadequate Lack of capital finding of commodity supply of buy on credit building available market prices raw but don't pay space skilled material back workers 0 Full sample Urban Rural Source: MCLPS. 2015 DISCRIM I NATION IN THE LABOR Onestudy foundthat ingarmentfactoriesinYangon's MARRET AFFECTS VULNERABLE industrial bones, pregnant and married women were GROUPS highly discriminated against in hiring (Action Labor Rights, 2016). Recruiters favored single women and, in some cases, women were even made to prove they There are numerous examples of discrimination were not pregnant to get a job. Furthermore, it was affecting labor market entry in the literature. While found that "some factories forced women to resign a full review of these is beyond the scope of the study, when they became pregnant to get out of paying a few examples pertaining to inclusion of vulnerable maternity leave, and if they were given leave, upon groups are discussed. returning to work they were treated as new recruits:" Overall, women in the labor market earn about 30 For children with disabilities, discrimination begins percent less than men, even when controlling for at an early age with difficulties in accessing birth factors that may drive the wage differential. The registration documents, enrolling in school, and gender wage gap could be due to various factors staying in school (See Chapter 4). This all affects their stemming from the literature: "unobservable or ability to enter into the labor market and participate unmeasured factors that lower women's productivity productively in society. (such as intermittent labor force participation, ownership of factors of production particularly land in highly agricultural Myanmar), employer or family (or self) selection out of more lucrativejobs, or competing time demands linked to gender roles (homecare, childcare). Unlike most countries, Myanmar labor laws do not stipulate the principle of equal remuneration for work of equal value, and do not contain a provision of gender nondiscrimination in hiring, which may contribute to the wage discrepancies (World Bank 2018, Background Paper on Labor Supply). 18 2.4 RISRAND RESILIENCE AFFECT ECONOMIC INCLUSION Natural ha6ards and economic shocks have been can result in individuals making decisions that they shown to negatively impact economic inclusion and otherwise would not (Calvo & Dercon, 2013). In the to slow poverty reduction. Over the past 25 years, longer term, uncertainty about future prospects Myanmar has suffered 24 disaster events, affecting can result in households postponing or reducing more than 4 million people and causing US$4.7 billion productive investments and can reduce investment in damages." When a natural disaster hits, there is in education. Other studies have estimated that much volatility in the economy, and it is often the poor populations affected by climate-related events can that are hardest hit. The urban poor are particularly take as long as 20 years to return to their original vulnerable as they typically live in less desirable and development trajectory (Hsiang & Jina, 2014). higher risk locations such as hillsides and flood-prone areas (see Chapter 3 discussion on slums). Economic The main economy-wide shock households in and health shocks are also significant, particularly for Myanmar face is reported to be fluctuations in the those with no safety nets. Low-income populations in prices of basic needs that stem from exchange cities often do not have safety nets, family networks, rate shocks, supply shocks, or shocks to transport or agricultural production to fall back on as they and logistic costs. Increases in food prices and in would in rural areas, leaving them at risk. the prices of other basic commodities and services make it harder for the working poor in both rural and Myanmar is exposed to a range of natural ha6ards, urban areas, who are net "consumers", to meet their including cyclones, earthquakes, floods, landslides, basic needs. (World Bank, 2017, Myanmar Economic tsunamis, and volcanoes. A 2015 UNISDR study Monitor) ranked Myanmar among the top three countries in terms of vulnerability to extreme weather events The level of self-reported shock exposure of (UNISDR, 2015), and both extreme weather events households in Myanmar is relatively high - almost half and inconsistent weather patterns are anticipated (48 percent) of all households reported at least one to increase in frequency and intensity over time shock in 2014, the year preceding the 2015 MPLCS. (HARP-F and MIMU, 2018). The population is also at At the household level, health shocks are the most risk to economic shocks which affect livelihoods in frequently reported (at the national level). 80 percent numerous ways. From July to September 2015, for of households in Myanmar report health care costs example, the country was hit by severe flooding and related to inpatient or outpatient care and, of these, landslides, which cut growth by 0.8 percent and led nearly a fifth reported that the health shock faced to an increase in the price of basic foods. With even by their household had a severe negative impact on the most affluent urban households spending up to welfare (World Bank, 2017a). Shocks are dealt with in 60 percent of monthly household income on food, different ways by households in Myanmar - borrowing the impact of weather events on food prices has a money, increasing labor supply and reducing food particularly negative impact on the urban poor (Ibid). expenditures. Shocks that cause a change in incomes can reduce investment in productive assets and can affect the education of future generations. Beyond the hardships caused by falling into poverty, the very risk of impoverishment can cause insecurity, increase stress and increase the sense of defenselessness; it 12 World Bank analysis based on data from EM-DAT database (http://www.emdat.be/) as reported in the Myanmar Southeast Asia Disaster Risk Management Project Document, World Bank, 2017 19 Box 2.1: Health Shocks and Welfare in Myanmar Health shocks, such as unpredictable or (Xu et al., 2005) in a given period. Defined either unforeseeable illnesses that diminish household way, catastrophic health expenditures add to health status, are among the principal factors poverty by diverting household spending for non- predisposing households to financial catastrophe health budget items. and impoverishment in LMICs. Health shocks are associated with out-of-pocket spending (OOPs) Myanmar has relatively high OOPs, with an for medical treatment, related costs such as the over 70 percent share of total national health costs oftransportation, aswell as foregone income expenditures in 2017, due to lower public spending due to the patients' inability to work. Faced with on health, and limited cost-sharing mechanisms health shocks, poor households sometimes forgo in the country, relative to its neighbors (World healthcare with negative consequences for their Bank, 2018). Consequently, nationally, 19 percent health and well-being. When households do incur of households reported spending more than 10 healthcare costs, they often use negative coping percent of their total welfare expenditures on strategies such as reducing other consumption, health, and 3.4 percent of the population was borrowing or selling vital household assets. pushed below the poverty line due to health spending (World Bank, 2018). Of households Such payments can be catastrophic if they are too that visited a health facility, 28 percent reported large relative to the available household resources taking loans and 13 percent sold their assets to to the extent of disrupting the household living covertheirOOPs. The levels of foregone healthcare standards and limiting their ability to purchase are also high, estimated to be about 4 percent other essential non-medical goods and services. nationally. The most important predictors of Catastrophic health expenditures are defined high OOPs relative to household capacity and as spending on health that is higher than 10- total household expenditure in Myanmar include 25 percent) of household income/expenditures income and the presence of chronic disease. Such (Wagstaff and Doorslaer, 2003) or exceeds 40 risks are highly prevalent in slums (as well as in percent of the household's non-food expenditures rural areas). 20 NJF -- 1g.1 I - SPA IAL NCLUSION KEY MESSAGES * Urban and spatial planning and management is limited. Where plans do exist, they are not fully implemented. This results in deficiencies in service delivery, and for larger cities (e.g.Yangon), congestion and growing informal settlements. * Given urban growth and a historical lack of investment in cities, the needs for sustainable infrastructure are massive across sectors - affordable housing, urban transport, water and sanitation, drainage and solid waste management. * Those living in informal settlements are most affected by limited infrastructure and services and are often at high risk from natural ha5ards. POLICY RECOMMENDATIONS * Invest in equitable access to sustainable urban infrastructure across sectors, with targeting to vulnerable areas. * Improve and expand affordable housing through upgrading, creating an enabling environment for housing supply and demand and crowding in the private sector for the low-income market. * Improve integrated spatial planning for inclusive and resilient urban development through aligning plans across agencies, ensuring planning is gender and disability -informed, building capacity and investing in geospatial data and sharing platforms 3.1 INTRODUCTION Given Myanmar's relatively early stage of urbani6ation, in Myanmar face challenges of spatial exclusion there is an important opportunity to shape cities so related to accessing urban land markets, housing, that they are well-planned, allow for job creation, and basic services in large part due to where they live affordable housing, and the movement of goods and or their citi6enship status. people. Patterns of spatial inequality can hamperthe benefits of economic development, exacerbate social Policy tools that can improve equity and spatial inclusion, and ripen the conditions for instability. This inclusion for the urban residents include the following: is particularly acute in cities given the density. opening access to land use and urban planning; land tenure; providing housing and basic infrastructure; Spatial planning in cities, if done well, can help to and urban upgrading (Baker & Gadgil, 2017). foster inclusion, and promote equitable access to This chapter addresses the urban challenges in land, housing, infrastructure, and basic services. Myanmar through a "spatial inclusion" lens, focusing Understanding the relationship between urban spatial on approaches to urban planning, followed by a structure and inclusion is important in understanding discussion of accessibility, affordability, quality and inter- and intra-urban disparities. Vulnerable groups safety of key services. 3.2 URBAN AND SPATIAL POLICIES AND PLANNING Spatial planning that is well integrated with transport national planning with typical five-year or ten-year planning can help to foster equitable access to urban plans as early as in 1960s under the influence of the opportunities and amenities. The pattern of a city's World Bank, Myanmar only started the process around physical layout or urban form is one of the many 2010. factors that affect the populations' ability to access economic opportunities in their cities. Good planning The government's Framework for Economic and allows for a spatial match between jobs, markets, Social Reforms (FESR) published in 2013 provides the public transportation, health and education services, latest guidance on strategic planning with short-term recreational areas, and affordable housing. concrete outcomes between 2012 and 2015, laying out the foundation for long-term goals. Before FESR was in place, the National Comprehensive Development NATIONAL URBAN STRATEGIES Plan 2011-2031 (NCDP) comprised four five-year plans, with goals set by the Federal Government and The great potential for urbani6ation in Myanmar detailed plans compiled from the inputs from as local presents a tremendous opportunity to put the as townships and local agencies. Apartfrom NCDP and right policies in place to influence the urbani6ation FESR are the Myanmar Comprehensive Development process for equity, as well as sustainability and city Vision (MCDV), Myanmar National Building Code, competitiveness.Thistranslatestoprovidingmigrants, National Urban Policy, National Land Use Policy, the urban poor, and excluded groups full access to the National Transportation Master Plan, National Spatial opportunities that cities can provide - jobs, land and Development Framework. While MCDV sets a vision housing, social and infrastructure services, public of "two-polar growth with border development and spaces and opportunities to participate in decision better connectivity:' the last four documents outline making. While many Southeast countries started effective sectoral planning strategies with a strong emphasis on sustainable urban development. 23 Figure 3.1: Myanmar's Administrative System and Planning Process FESR NCDP MCDV National 5-year development plans and sectoral plans t Regional and state development plans t Distric and township development plans Source: Asia Foundation, 2016 Different policies to guide urban growth are at varying new legislation, as well as to shape implementation stages of being developed and implemented. Described strategies in the urban sector. A NUP Framework was below, these broadly aim to introduce strategic recently discussed at a workshop held in June 2018, development objectives and a spatial hierarchy to involving DUHD, representatives from the 14 states guide urban development in Myanmar. At the state and regions and development partners; however, the and regional levels, however, long-term urban planning timeline for implementation of the NUP is unclear. is not commonly carried out." NATIONAL SPATIAL DEVELOPMENT NATIONAL URBAN POLICY FRAMEWORK The proposed National Urban Policy (NUP) - led by As part of NUP, a National Spatial Development the Department of Urban and Housing Development Framework (NSDF) is also being developed by MoC (DUHD) at the Ministry of Construction (MoC) - with support from UN Habitat (International Growth aims to implement a comprehensive, long-term Centre, 2016). The Framework establishes a hierarchy vision for urban development in Myanmar, with of cities to shape future urban development, with: spatially integrated urban settlements, adequate Yangon, Mandalay and Nay Pyi Taw as strategic infrastructure, and an enabling urban governance growth centers; environment (UN Habitat, 2016). Driven by three Regional secondary cities such as Pathein and central goals of economic development, livability Mawlamyine as clusters of commercial activities and sustainability, NUP identifies (i) municipal and transport links; governance and finance; (ii) urban and regional Tertiary cities such as Lashio and Magway linking legislation; (iii) land governance; (iv) housing and (v) rural economies with agro-industrial processes; environmental and climate change issues as the five and thematic areas for priority action. Once endorsed by "Special purpose cities" such as Tamu and Muse the National Assembly, the intention is for NUP to - border towns to support national reconciliation guide any legislative changes and/or introduction of and promote trade. 13 A 2016 study by The Asia Foundation found that no DDA had invested in strategic planning or policy-making regarding secondary cities and the role of urban development in regional socio-economic development. The study however suggests that this could be due to the relatively new subnational administrative structure in Myanmar and the need to address other more pressing concerns 24 Critically, the draft NSDF has also been factored INSTITUTIONAL AND LEGAL in to the formulation of a National Transportation FRAMEWORKS Master Plan, outlining a system of transportation axes that corresponds with the general orientation for nationwide spatial development (Ministry of N IUT NA URANEWORNFRCA Constuctin, 216).PLANNING AND URBAN GOVERNANCE Construction, 2016). At the Union-level, spatial planning, land NATIONAL TRANSPORTAT ON MASTER administration, housing and urban development come PLA N under the purview of the Ministry of Construction (MoC). Within MoC, the Department of Urban Housing and Development (DUHD) takes the lead in urban The National Transportation Master Plan recogni6es development lcmkn stia lannin an the key role that transportation plays in fostering urban.infrastructureadevelopment.lWhilenongoing continued economic growth and social development. decentratuteortsomant th l o ial The lanwasdevlopd t proidea fameorkfor decentrali6ation efforts mandate that local spatial The lanwasdevlopd t proidea fameorkfor planning responsibilities should be undertaken at the a long-term investment program that will enable the subnina el,challeges o beaung th counry o cpitli6 oninteraton n te AEAN subnational level, challenges to reali6ing this vision cegonryswellas to acilonntegonn ithe aS t exist, as discussed further in Chapter 5 below. DUHD region, as well as to facilitate connectivity amongst cotnetoreieaait-udntannad the hierarchy of cities identified under NSDF. All . y g g assistance from international development partners modes of transport are covered by the plan, including as JAan d haoale ertaen tn- road, rail, air, maritime and inland waterways. In leve an plan i s a nd town addition, the Plan is aligned with Myanmar's National Comprehensive Development Plan (NCDP) for Myanmar. While DUHD has local offices in all fourteen states and regions, as well as a handful at the 2011-2031, which establishes a long-term national stesadrgo,aswlasahnfltte 2011-2031,t whih enstraeic oalo r ndistrict level, the Department is not seen as having a significant presence outside of Nay Pyi Taw. Figure 3.2: NSDF Hierarchy of Cities Figure 3.3: NSDF Development Corridors 52 A- 00 Tsr0ir * 1h"l-d Source: Myanmar Ministry of Construction. 2016 Source: International Growth Centre, 2016 25 The 2008 Constitution created 14 new state and revenues (Asia Foundation, 2016). Urban planning region governments with semi-autonomous political is among the many legally-mandated functions of and administrative structures, as well as the Union DAOs, but this is not commonly carried out. Territory of Nay Pyi Taw. Except for Mandalay and Yangon, each of the remaining state and region Different administrative arrangements are in place governments has a Department of Development for Yangon, Mandalay and Nay Pyi Taw. Yangon Affairs (DDA), an umbrella institution that oversees and Mandalay are managed by the Yangon City Development Affairs Organi6ation (DAO), which in Development Committee (YCDC) and Mandalay turn are solely responsible for urban governance at City Development Committee (MCDC) respectively, the district/ township level. Myanmar has a total of both of which are responsible for delivery of urban 325 townships and 67 districts across the 14 states infrastructure and services, land administration, and regions (Asia Foundation, 2013). urban planning, public health and tax collection. These are si6eable government agencies that Every DAO is guided by its own Development Affairs manage multiple townships - 33 in Yangon, and 7 Law (or municipal law), but in practice all DAOs are in Mandalay. YCDC and MCDC are not autonomous similar, functioning as deconcentrated departments municipal governments, but instead come under with the autonomy to plan and budget as required. the authority of the Yangon Region and Mandalay Figure 3.3 lists the social and economic functions Region Governments. As the capital of Myanmar, Nay of DAOs, which are financed through a combination Pyi Taw is managed by a 10-member Nay Pyi Taw of revenue shared by the Union Government, a Council, with a General Administration Department limited amount of transfers from State or Region (GAD) responsible for the administration of the Union Governments and other DAOs, as well as own-source Territory's 8 townships. Figure 3.4: Functions of DAOs DAO Social Services Duties and Functions DAO Economic Goveranance Duties and DAO__Social_Services_Duties_and_Functions_Functions - town planning - water supply - markets owned by the committee - sanitation - privately-owned markets - sewage disposal - cattle markets - disaster preparedness - slaughter houses - street lighting - roadside stalls - roads and bridges - small loan business - vagrant persons on streets - bakeries and restaurants - animal control - dangerous trade - parks, swimming pools, public baths, - lodging houses and recreation centers - breeding of animals and disposal of - road rules, street naming & addresses carcasses - cemeteries and crematoriums - ferries - removal of cemeteries - slow-moving vehicles - other development works in the public interest - other duties as needed - public buildings under the charge of the committees - demolition of squatter buildings - construction permission for private buildings Source: Asia Foundation, 2016 26 Box 3.1: Urban Planning in Yangon City Development Committee (YCDC) The City of Yangon Development Law, enacted grants from external organi6ations. With the in 1990, gives YCDC the mandate to plan and enactment of the Yangon City Municipal Law in implement urban development work within 2013, YCDC is considered as being accountable to the city, including land administration, urban the Yangon Region Government. This is in line with planning, development of newtowns, construction Myanmar's 2008 Constitution, which assigned all and maintenance of municipal infrastructure municipal affairs to States and Regions. and delivery of basic urban services (e.g. water supply, sanitation, solid waste management, YCDC has a total staff of more than 10,000, social/ community facilities). The law also grants spread across 20 departments as shown in Figure YCDC the ability to determine the territorial limit 3.4. This includes a dedicated department for City of the City of Yangon, the ability to collect duties Planning and Land Administration. and taxes, as well as the right to take loans and Table 3.1: YCDC Departments Administration Department Engineering Department (Roads and Bridges) Budget and Accounts Department Engineering Department (Water Supply & Sanitation Work Inspection Department Pollution Control and Cleansing Department Co-ordination Department Motor Transport and Workshop Department Assessor's Department Central Store Department Revenue Department Playground, Park and Garden Department Markets Department Security and Disciplinary Department Veterinary Department Health Department City Planning and Land Administration Information and Public Relations Department Department Engineering Department (Building) Production Department Source: YCDC A study by a JICA team in 2013 found 4 YCDC The administrative structure and roles and bylaws relating directly to urban planning (JICA, responsibilities of YCDC are expected to undergo 2013). While these defined the activities to be furtherchanges. On29June2018, anewYCDC bill carried out - for example, the formulation of city was approved by the Yangon Region Government, development plans, processing of applications following several months of debate (San, 2018). for construction - there was little by way of Developed with the assistance of experts from detail in terms of procedural responsibilities Singapore and Japan over a period of two years, and enforcement. The City Planning and Land the new YCDC bill supplements the 2013 YCDC Administration department has also produced Law and proposes a number of changes to regulations relating to urban planning, but it is municipal governance. YCDC itself, for example, unclear whether these have legal standing. These will undergo structural reform, whittling the include: existing 20 departments down to seven. The full array of proposed changes and the subsequent * Building setback from main roads; impact on the work of YCDC remain to be seen. * Building height; * Special height control around the Shwedagon Pagoda; and * Special height control around Yangon International Airport. 27 LEGAL FRAMEWORK Urban System Plan; (iii) Concept Plan for a City or Town; (iv) Detailed Plans with specific land uses for A comprehensive legislative system was inherited limited areas; (v) Technical Urban Infrastructure from the British colonial era, and several laws and Plans; (vi) Plans for Special Development Areas. regulations relating to urban planning and land Notably, the Law proposes the introduction of long- management remain in place today. Some are term Concept Plans, focusing on integrated land use outdated and require modification or replacement, and infrastructure needs with 50-year time hori6ons, particularly in light of the Constitution adopted as well as Detailed Plans that translate Concept Plan in 2008. However, the revision of laws has been a intentions to a smaller scale. slow process, and has been identified as an area in which international technical assistance should be A Myanmar National Building Code has also been provided (JICA, 2013). Table 3.2 below summari6es developed by the Myanmar Engineering Society current legislation relating to urban planning, land with support from UN-Habitat, with the aim of management and housing 14. introducing global standards for technical building norms and regulations. The Code was introduced in An Urban and Regional Development Planning Law 2016. Aside from stipulating building regulations, the is being drafted by DUHD, defining various types Code also specifies the types of building uses allowed of spatial plans and roles and responsibilities for under 6oning plans, and suggests that the legal development and implementation across different scope of 6oning plans will be more clearly defined in levels of government. The Law proposes six different the forthcoming Urban and Regional Development types of plans - (i) National Urban System Plan (the Planning Law (Myanmar Engineering Society, 2016). NSDF being a preliminary version); (ii) State/ Region Table 3.2: Laws Related to Urban Planning and Management Law Description Land Acquisition Act Stipulates that land can be acquired by the government if deemed to be in the (1894) public interest. Religious lands (pagodas, stupas, shrines and cemeteries) are exempt. Rangon Development The Act resulted in the establishment of the Rangoon Development Trust in 1921. Trust Act (1920) The Trust was granted powers including the purchase/ acquisition of immovable property, project development planning and land management, levying of revenue taxes and lease fees of land, and establishment of laws and regulations as required. The Trust, based on the Act, managed long- and short-term leases of land and approved allowable uses. In this vein, the Trust issued land lease licenses, permits for construction, industriali3ation, agriculture and other special uses. State's Housing The Act was introduced in response to a housing shortage, which resulted Rehabilitation and from high levels of rural-urban migration into Yangon (then Rangoon) following Town and Villages independence. The Act stipulated that shelter would be provided through town and Development Board village development projects as well as public housing rehabilitation projects. To Act (1951) facilitate the provision of shelter, any land or building could be acquired through the 1894 Land Acquisition Act. It also allowed town and village development, supervision of public housing rehabilitation, land management and other related issues to be managed on a nationwide basis. Urban Rent Control Similar to the Act above, the Urban Rent Control Act was introduced in response to Act (1952, amended in the growing need to house in-migrants. The Act regulated urban rents to a low and 1960) affordable level and remains in effect today. Maintenance of rented properties has become a concern for many property owners as a result. Farmland Law (2012) Introduced in August 2012 under the 2008 constitution, the Farmland Law allows all farmers in Myanmar to enjoy land use rights. Source: Adapted from JICA, 2013 14 Other related laws and regulations, such as the Town Planning Act (Draft Proposal) of 1961 and the Municipal Act of 1898 also exist, but their contents and continued application in today's context require confirmation (JICA, 2013) 28 Box 3.2: Urban Plans in Yangon YCDC's Strategic Urban Development Plan of Furthermore, JICA completed the Comprehensive Greater Yangon (SUDP) (Phase I and II), or Greater Urban Transport Plan of the Greater Yangon Yangon Master Plan, aims to make Yangon a (YUTRA) in 2014, with additional studies on green city with sustainable and strong economic Yangon Urban Mass Transit (YUMRT) in 2015. The growth by 2040. The plan was developed in 2014 various Master Plans have progressed into Loans with J ICA's assistance and proposes a set of urban forthe GreaterYangon Water Supply Improvement development projects in a wide range of urban Project and the Yangon Circular Railway Line service sectors, e.g. solid waste management, Upgrading Project. By expanding BRT networks, power supply, economic 5one development, regulating parking, and establishing a unified transportation, etc. (Figure 3.4). It highlights the transportation agency, YUTRA aims to double urgent need of density management, heritage the number of trips per person per day by 2035. conservation, and expanding Yangon city to be able to accommodate 10 million residents in the future. The plan also outlines a vision of building seven new satellite cities and five sub-centers around Yangon. Figure 3.5: Urban Function, Industrial Function, and Green and Water Function Envisioned in Greater Yangon Master Plan 144 Source: JICA, 2014 29 3.2 URBAN PLANNING CHALLENGES The lack of comprehensive, integrated land use and Urban plans are commonly viewed as "belonging" infrastructure plans to guide urban growth is a noted to MOC, with little ownership on the part of DAOs. shortcoming in Myanmar (Harvard Kennedy School In addition, little emphasis is placed on the plans , 2012). Where plans exist, the ability to ensure that in terms of impacting DAOs' decisions on urban growth takes place in accordance with plans is also investments and services. As a result, public sector not guaranteed. Globally, cities with well-managed agencies are not always aware of each other's' plans, and inclusive urban growth have largely succeeded often resulting in duplication or fragmentation of by developing and implementing robust urban plans. work, as well as missed opportunities for connectivity Singapore and Tokyo, for example, are often cited and more efficient delivery of services. as adopting international best practices in urban planning, incorporating a long-term, integrated view Within YCDC and MCDC, an urban planning function while also allowing for flexibility over the course exists more clearly. YCDC, for example, has a City of urban growth. Aside from informing land use Planning and Land Administration department, decisions and timing infrastructure in tandem with among whose responsibilities are urban planning and growth, a comprehensive urban plan can facilitate urban design (see Box 3.1 above). At the same time, the conservation of built and natural heritage, both the division of responsibilities across different YCDC of which are significant in cities such as Yangon and departments is unclear. As an example, YCDC has Mandalay. the mandate to assess applications for construction and issue building permits, but without a clear procedure in place, an application could go to either LACK OF CLARITY OVER ROLES the City Planning department, or to the Engineering AND RESPONSIBILITIES (Building) department. If assessed by the City Planning department, planners can check whether Municipal governance is unique in Myanmar, with the proposed development is in line with regulations no single agency having clear authority or decision- produced by their team, such as setback or height making power over the urban sector. The National control. Any existing infrastructure constraints can Urban Policy Framework notes that Myanmar's also be verified. These checks provide an opportunity .highly segmented municipal administrative for YCDC to ensure that developments comply with . .. a broader planning or urban design vision for a part landscape" has resulted in a "vast and permanent g g need for cooperation and coordination." Despite urban of the city, and that the supporting infrastructure is able to support further development. However, if planning falling within the legal mandate of each DAO, no dedicated urban planning function exists at either the proposal is sent to the Building team, there is no the state/region or township level. Feedback from a guarantee that such checks are carried out. DAO Director, as captured in the Asia Foundation's repot MnicpalGovrnace i Mynma, idicted Aside from unclear roles and responsibilities within thaot Mu[t cihe l GAsshouldrdonbn pann,inarted YCDC, urban governance and service delivery inYangon that "[t]he DAOs should do urban planning as per the as ean ope ie htUingvrmn also remains complex given that Union government law, but we can't. There is a gap between practice, agencies, the Yangon Region Government (YRG) and duties and responsibilities:' YCDC all operate in parallel. As shown in Figure 3.6, YCDC technically comes under the purview of the Instead, MOC's Department of Urban and Housingy Development (DU HD) is chiefly responsible for spatial Ministry of Development Affairs, one of 12 Ministries overseen by the Chief Minister of Yangon. However, planning in urban areas. It is unclear, however, as to . . .given Yangon's history of having a autonomous the extent that this is done in close coordination with munpalgonac strr e YD is sen as other public agencies and subnational governments, funcionngore s"thrtee M is thn as particularly because DUHD has a limited presence don mode atteeth Ministry" than a outside of Nay Pyi Taw (Asia Foundation, 2016). The role of DAOs in DUHD's urban planning is generally the new YCDC bill in June 2018, it remains to be seen limited to facilitation and sharing of information, as to whether a streamlined administrative structure 30 ■■―■―‘痲 wi∥ enable cleorer delineotion 。nd execution of roles PrimQr늬 role in undert。king sPotioI plonning for cities 。nd responsibilities. 。nd townships 。cross the countr늬． Within YCDCs Cit늬 PI。nning 。nd L。nd Administrotion DepQrtment, stoff come from 。 v。riet늬 of b。ckgrounds, including LOW CAPACITY FOR engineering 。nd architecture. Onl늬 a handful of staff . & 。 n . 「 & 。 「 k . ㅜ ^ ㅜ． ^ k . h。ve formoI trainin。 in urbon ol。nnina and desi。n. ^ smQI· numDer r1CIVe Deen 。w。r。eo scnOI。rsmps ror _ _ formaI oI。nnin。 educCltion. mostlu in South Korea 。nd - ne UnCIeor 미VIS·On Or r이eS OnO reSDOnS[D∥IrleS 15 - , - _ . . . . . . _ _ 」ODOn. OnO OOnOr OSSISrOnCe Or DOrn rne UnIOn- OnO rUrrner COrTIDOUnoeO DU O ·OCK Or CODOCIrU ro COrrU OUr _. _ - _ . - - . LIrU -IeVel nOS ·nC·UOeO O rOCUS On CODOCIrU - DUllCllnO In OSSIOneO O UrleS. - ne UeDOrrrTlenr or UrDOn ㅂOUS·nO OnO - , - _ - _ _ _ - UrDOn 이OnnInO . uevelopmenr, ror eXclmPle, r1Qs om늬 &U rrQIneo urDCln planners on staff - 。 smaI- number considering MOCs 31 Figure 3.6: Administrative Structure, Yangon Region Government Chief Minister Regional Parliament (Hluttaw) Regional Government Regional High Court Regional GAD Executive Secretary to Cabinet Regional Auditor General Ministry of Agriculture Ministry of Social Affairs, Ministry of Ministry of Eleettric Regional Cabinet M = and Livestock Breeding Education Health Transport Power and Industry M M M General Adm Budget Planning Agetculture Forestry YCDC Cooperatives Central Myanmar Regional Department Department Department Department Department Department Stevedoring Motion Law office Committee Pictures Development Bureau of Sports Livestock Environmental Affairs Dep, Department special Department & Animal Conservation Dep. for SMEs investigations Husbandry Dep. MqanmaSaIt Human Fire and Fisheries Settlement & Regional Budget departments Department Chemical Department Housing = Regional Adminstration Products Department (All departments reflected) Water Resources Utilisation Dep. Maintenance Infra, Roads & Bridges Public Works Myonmar Internal Directorate Irrigation ??? Education Dep of Water Yangon City Police Force Revenue ofTrade Department Department Resources and Electricity Department River Systems Supply Board Nat. Dep. of Trading Dep. of Settlement Health Department Human settlement De-concentrated Union Budget Registration Customs & Consumer and Land records & Housing Dep. departments (only most relevant & Immigration Department Relationship Social Welfare departments are reflected) Department Civil Aviation Prison Pension Department Department Department Dep. of Relief Transport Planning & Resettlement Dep. Road Transport Labour Department Administration 3.3 LAND Secure land tenure and property rights are essential commonly lack evidence of their right to ownership to inclusive urban development, as they underpin (NAMATI, 2016). economic development and social inclusion. When land is poorly managed, associated problems often lead to disputes and corruption, land degradation, and lost LAND POLICY AND REGULATORY socio-economic opportunities. While many countries FRAMEWORR have tried to harmoni6e modern statutory laws with customary ones, land tenure and property rights still Myanmar's current land administration challenges are often affected by complex and contradictory are legacies of the British colonial period and set of rules, laws, procedures, customs, traditions, subsequent regimes. There are multiple and perceptions and other barriers (UN-Habitat and overlapping institutional mandates (World Bank, GIZ, 2014). In Myanmar, a good number of citi6ens, 2017c) and legal and regulatory frameworks (as especially in rural areas, have historically possessed shown in Table 3.3 and Table 3.4), as well as a weak and used land without formal documentation. As a system of land classification. The situation is further result, their land and property rights are not secure, exacerbated by indeterminate land entitlements; causing fundamental vulnerability in their livelihoods. lack of a comprehensive land registry and geospatial The 2008 Constitution stipulates that land is owned information; lack of a formal method to protect and by the State and that citi6ens have property rights, recognise customary land rights; lack of Free, Prior and it is essential that these rights are secured to and Informed Consent (FPIC) process (critical for achieve a market-led economy with a vibrant land Myanmar's Indigenous population); excessive use manarrkdieot.ouato) ecsiv s market. of state power on eminent domain; and policies for land concessions that override customary rights and Other aspects of exclusion to land in cities noted in other rights holders (FAO, 2016). Weak awareness the literature relate to cititenship (or obtaining proof and knowledge of land laws, land policies, and land of citigenship through the Citigenship Scrutiny Card regulations by government staff, business, civil which can be more difficult for ethnic or religious society and professionals has contributed to disputes, minorities), documentation of inheritance, transfers scit and ofsion in cynru ld t secto and ownership, literacy in Burmese, and high costs (World Bank, 2017c). of registering deeds which can be prohibitive for low or middle-income families (Rhoades, 2017, Literature review, social inclusion in Myanmar. background paper). The National Land Use Policy (NLUP) includes a dedicated section on gender equality, guaranteeing, among others, equal inheritance rights and land tenure to women. A study drawing on paralegal casework in Myanmar, however, found that while the law is gender-neutral in issues relating to land and property ownership, 80 percent of clients who sought paralegal assistance for land registration issues were men, likely because men more commonly hold land rights. 87 percent of male clients were also married, suggesting that in married households, it is typically the case that men hold legal rights to the couple's property. More than 15 percent of female clients lacked land possession documents, compared to only 5 percent of men. This suggests that women are more vulnerable to land-related disputes as they more 33 Table 3.3: Government Agencies Providing Land Services Agency Description Department for Under the Ministry of Agriculture, Livestock, and Irrigation's (MOALI), DALMS Agricultural Land takes most of the responsibility for land services. Management Statistics (DALMS) General Administration Under the Ministry of Home Affairs (MoHA), GAD is responsible for administering Department (GAD) and managing all non-forest and non-farm land in the country, which included town, village, religious and common land, riverbanks, ponds, cemeteries, graing pastures and disposable state land. While GAD holds management responsibility, technical functions rest with the SLRD in most cases. Settlement and Land Established in 1907, the SLRD's roles were the fixation of land revenue rates, Records Department assessment of land revenue, maintenance of registers on land administration (SLRD) cases; and surveying of land and preparation of maps for the said purpose. In 1962, SLRD main objectives were redefined to the collection and compilation of agricultural statistics (Myanmar Agriculture, 2018). Survey Department (SD) Scales and supports the first and second order geodetic network of the country. City Development In the three main cities of Myanmar, Yangon, Mandalay and Nay Pyi Taw, City Committees (CDCs) Development committees provide land services instead of DALMS and GAD. Source: World Bank, 2017 Table 3.4: Laws and Regulations Related to Land Rights Agency Description The (Lower Burma) Land and The first law to clarify rights related to cultivable (agriculture) land Revenue Act, 1879 The law sets the assessment and collection of land revenue The Upper Burma Land and Land revenue collection extended to Upper Burma Revenue Regulation, 1889 The Land Acquisition Act, The law determines boundary demarcations and settlement operations 1894 for land revenue for land within towns and villages The law also determines the procedures related to eviction from land acquired by the government The Lower Burma Town and The order allows vacant lands and fallow lands at the disposal of the Village Lands Act, 1899 Government to be transferred Land and Revenue Order, 1911 Sets rules on processes of objections Land Acquisition Rules, 1932 Compilation of land acquisition related laws including notices and directions, and provided procedures for land acquisition Land Acquisition Manual, 1947 The Law determines rights of land ownership for certain cases The law serves as a basis for all land to be nationali3ed and distributed Land Nationali3ation Act, The Law prohibits a person to sell, buy, give away, pawn, exchange or 1953 transfer by any means immovable property with a foreigner or foreign owned company Transfer of Immovable Determines procedures and conditions for: i) application and conditions Property Restriction Law, for usage of vacant, fallow, and virgin lands; ii) conditions for guarantees 1987 and land revenue; and iii) roles, regulations, and monitoring to be imposed upon usage of lands Vacant, Fallow, and Virgin The law determines boundary demarcations and settlement operations Lands Management Law, for land revenue for land within towns and villages * The law also determines the procedures related to eviction from land acquired by the government Source: JICA, 2016 34 LAND ADMINISTRATION AND To successfully implement the NLUP, it is essential TENURE that a union-level council is established to convene the fragmented groups that may attempt to implement the policy in different ways. The council is anticipated The lack of land ownership records is a challenge tbe a "ehia dioybd hticue that Myanmar is currently addressing. Land records are in poor condition and people often do not register representatives from different stakeholders' groups, land transactions. Land use certificates (LUC) often such as farmer associations, ethnic nationalities, contain errors and inconsistencies and many of them civil society, academia, the private sector and must be replaced. Many of the survey and Owin" others." Furthermore, to implement NLUP, Myanmar maps have not been properly maintained and deed must develop a comprehensive legal and regulatory framework (which may include amending outdated registers for updating plot ownership are often not used. The lack of an up-to-date land record have led laws, regulations and procedures) that ensures a land to disputes concerning alleged land grabbing and governance system this fair and inclusive. Finally, it is government staff are often tasked with resolving essential that the nascent geospatial infrastructure time consuming individual cases (World Bank, 2017c). and services be systematically supported in Issuing certificates of land ownership and ensuring the process (and eventually development into a that all land measurements are made on a common comprehensive national spatial data infrastructure system and digiti6ing the data are among the highest (NSDI)) to ensure overall efficiency and effectiveness priorities. A Land Information System (LIS) has been of the sector (Ibid). piloted to identify land titles, 6oning ordinances affecting the land use, and the status of any planning permit or development on the land (Ministry of Construction, 2016). NATIONAL LAND USE POLICY OF 2016 In January 2016, the Government adopted the new National Land Use Policy (NLUP), intended as a living document that will form the basis of a new National Land Law. Driven by the need to unify the current diverse set of lands laws in the country, the NLUP establishes policies to manage, administer, and use the land resources of Myanmar for the purposes of "livelihood improvement of the citi6ens and sustainable development of the country". Furthermore, N LU P outlines the common vision among Myanmar's government, civil society, businesses and academia for building the infrastructure to provide institutionally sanctioned, automated means for easy access and sharing of authoritative geospatial information and delivery of land related e-services (World Bank, 2017c). 15 The Kwin map are the basis for settlement planning and management, land tax collection, crop statistic data compilation and land rights allocation mutation 35 Box 3.3: Smart Cities - Kwim Map DigitiZing and Spatial Data Procession Under Land Administration and Management Program (LAMP) Smart cities focus on the strategic use of The Land Administration and Management new technology and innovative approaches to Program (LAMP, 2013-2015) focused on upgrading enhance the efficiencies and competitiveness the existing pilot Land Administration System of cities (UN-Habitat, 2015). In the land sector, (LAS) computer system and database at the smart city technologies can be utili6ed to township level for long-term use and development. establish and improve the fluidity of land The new spatial data process involved an open- markets. Poor land management may lead to source GIS system (for cost efficiency) and disputes, land grabbing, land degradation, and included: 1) map scanning, ii) image enhancement lost socio-economic opportunities. Land-related for legibility; iii) geo-referencing of the Rwin map; smart city technologies such as satellite imagery iv) digiti5ing of each holding shown on the Kwin and geospatial data, open-source GIS software, map; v) digiti6ation of the holding boundary based digiti6ed land administration systems (LAS), on satellite imagery and calculation of land area; and national spatial data infrastructure (NSDI), and vi) preparation of field maps for field visits. can reduce errors and inconsistencies in land titling and certificates, making land registry and transfer processes efficient, transparent and accessible. Al- I Digiti6ed data plotted out to highlight Land records are compared on the quality control screen difference in Kwin map and satellite image. to identify errors. Automated report on errors based on Holding with a match in LUC records are highlighted. If matching tool. there is no match, the holding will be further investigated. Source: World Bank, 2017c 36 3.4 HOUSING Given the recent urban population growth, Myanmar 3.4.1 ISSUES AROUND EXCLUSION faces the challenge of shortages in adequate and IN THE HOUSING MARRET affordable housing in cities. Furthermore, like other developing counties in the region, the housing sector In Myanmar, a majority of the population still live in in Myanmar is characteri6ed by the dichotomy semi-temporary or temporary housing structures. of formality and informality (UN-Habitat, 2018). In Yangon, only 25 percent of the households reside Since the economic liberali6ation, major cities in . . in formal housing units such as condominiums, Myanmar have focused on the construction of high- apartments, and brick houses (also categori6ed as rise apartments and condominiums, adding stress ,pucca"). The remaining 75 percent of households to the affordability of housing as well as the cities' basi inrastuctre nd srvies.Furtermre, live in semi-pucca or temporary structures that forcd ifrslactfr m anaerdisartermsuch require frequent upgrades and retrofitting, as shown forced displacements from natural disasters such i al . A1,21b.Mn fteeuenn as the 2008 Cyclone Nargis has led to rapid rural- inrTabe 3.5 (ADB, suh a s use non- urban migration, and a growing population living in paen uidigateialsesuchwascbamboo,ewood infomalsem-fomal ettemets.mud plaster, and corrugated sheets, which expose the homes to various climate-related and disaster risks. A multidimensional disadvantage Index (MDI) using Housing development in Yangon and major cities the 2014 Census data found that among 14 indicators, must therefore consider the need for reconstruction, the most common disadvantage is housing, with upgrading, and/or retrofitting of semi-pucca and nearly half of the country's population experiencing a temporary structures, which constitutes over a disadvantage in this domain. 16Ensuring the provision majority of the current housing stock. of low cost and affordable housing is a priority in urban reas.In terms of ownership, approximately 25 percent of households are renters, with many aspiring to move towards ownership (Table 3.6). For such households, it is essential that affordable housing and housing finance is available. Table 3.5: Conventional Households by Types of Housing Units in Yangon Type of Housing Unit Total Apartment/ Bungalow/ Semi- Wooden Bamboo Hut Hut 1 Other Condo Brick Pucca House 2-3 Year House House Years North Yangon 566,167 41,378 40,544 60,132 265,847 138,340 7,517 5,843 6,566 East Yangon 486,790 112,666 47,588 54,772 211,653 47,644 3,781 2,566 6,120 South Yangon 339,205 4,815 12,276 17,031 142,082 152,721 5,319 3,226 1,735 West Yangon 190,782 108,005 16,639 18,706 39,841 5,714 422 230 1,225 Total 1,582,944 266,864 117,047 150,641 659,423 344,419 17,039 11,865 15,646 Source: ADB, 2018 16 Ministry of Population and Labor and the World Bank, 2018, "Multidimensional Welfare in Myanmar" 37 Table 3.6: Conventional Households by Types of Ownership in Yangon Type of Ownership Total Owner Renter Provided Government Private Other Free Quarters Company (individually) Qatr North Yangon 566,167 344,903 156,717 15,620 30,483 9,924 8,520 East Yangon 486,790 271,801 154,948 22,849 20,597 6,244 10,351 South Yangon 339,205 293,928 26,768 7,831 6,887 1,847 1,944 West Yangon 190,782 110,146 49,420 7,556 19,366 2,273 2,021 Total 1,582,944 1,020,778 387,853 53,856 77,333 20,288 22,836 Source: ADB, 2018b 3.4.2 AFFORDABLE HOUSING 3.4.3 INFORMAL SETTLEMENTS The National Housing Policy White Paper found that While there is no national level statistic on urban only 14 percent of all households in Yangon can afford populations living in informal settlements, it is housing units through formal provision channels (UN- estimated that slum residents account for at least Habitat, 2018). Rapidly rising rental prices in Yangon 10-15 percent of Myanmar's population (International haveforced low-income residentsto move into cheaper Growth Centre, 2016). Rural-urban migration as part but poor condition rental units or in worse cases, out of the country's economic transition, as well as recent of the rental housing market to squat in unhealthy, natural disasters, have been major contributing unsafe conditions. In Yangon's poorest settlements, it factors to increased urban informal settlements, is estimated that 73 to 96 percent of residents live which has resulted in a chronic shortage of affordable in houses with poor or very poor quality (Ibid). Formal housing in major cities (Ministry of Construction, residents from the inner city who cannot afford are 2016). forced to seek more affordable rental options in the city's periphery areas (Forbes, 2016). Based on the latest survey conducted by General Administration Department (GAD) in 2017, the total The large number of informal settlements in cities of area occupied by informal settlements in Yangon is Myanmar, detailed in the following section, reflect the over 2,000 acres with approximately 475,000 people undersupply of affordable housing options. The short (or 155,000 households) living in such settlements. supply of land for affordable housing and high land Furthermore, based on remote sensing data, it is prices are key reasons for high housing prices. Large estimated thatasignificant amount of these informal pieces of land were transferred to private developers settlements (especially those in peri-urban Yangon as and individuals associated with the military in 2010 many as 270 out of 423 settlements) formed between and 2011, which led to a shortage of government- January 2010 and July 2017 (ADB, 2018b). Many of owned land to develop affordable housing. Since the these informal settlements are located in peripheral introduction of the Land Law in 2012, land prices areas such as Htantabin, Hmawbi, Twantay, HIegu, or for farmland increased 14 to 90 times, especially Thanlyin, several of which are near the city's industrial farmlands which were subdivided for residential 6ones and have limited urban services (JICA, 2013). purposes. Furthermore, Myanmar's underdeveloped housing finance sector (detailed in the following Approximately 77 percent of the informal settlements chapters) has not had a transparent and inclusive identified by Mapping Yangon are located in these system in place and thus has undermined the effective peri-urban resettlement areas (UN-Habitat and supply of affordable housing (UN-Habitat, 2017). Cities Alliance, 2017). Without sufficient options for affordable housing, higher rents have pushed the urban poor from central areas to fringes of cities 38 where inexpensive accommodation options are Recent high-level urban policy documents such as available; however, the provision of basic services is the Rapid Urban Diagnostic Report, National Urban limited. Policy Framework, and National Housing Policy White Paper have recogni6ed the issue of slums. However, The housing conditions in the settlements are poor, there is no comprehensive informal settlement with most households living in temporary houses policy. The national government is pursuing small- made of non-permanent structures, in a space under scale settlement planning for secondary cities, 200 square feet in si6e (Ibid). Houses inYangon's slums particularly focused on small villages in forest areas are also vulnerable to fire accidents and collapsing. and regulari6ing the villages for habitation under the Informal settlements are usually overcrowded without GAD. For major cities, the regional government and adequate fire lanes. Most houses in slums are built with CDCs have been addressing the issues. In Yangon, the flammable materials such as bamboo, palm leaves, Yangon Regional Government (YRG) has announced a and wood; and residents commonly use firewood for city-wide plan to address the slum and squatter issue cooking. The Mapping Yangon project estimated that through assessment, resettlement, and enforcement 92 percent of the informal settlements were exposed of relevant rules and laws (Ministry of Construction, to moderate to high risk of fire accidents. The quality 2016). of most self-built houses is such that they do not meet basic standards for emergency responses. 3.4.4 MILLION HOMES PLAN Substandard houses elevated on bamboo stilts are also vulnerable to collapsing from flooding or To address the growing housing shortage, the strong wind (UN-Habitat and Cities Alliance, 2017) government put forth a "Million Homes Plan" to (YCDC and Save the Children, 2016). The informal develop one million new housing units by 2030. MOC's settlements are often distributed on low-lying land, Department of Urban and Housing Development adjacent to major water courses such as the Hlaing (DUHD) has formulated a plan to supply 20 percent of River, Pa6undaung Creek, and the Yangon River. They the total number of homes, of which 90 percent are to are susceptible to seasonal flooding and tidal flows, be low-cost housing for low-income households, and which add to their vulnerability. 10 percent are to be affordable housing units for lower middle-income households. Between 2010 and 2016, Although urban planning is generally lacking for DUHD was able to complete only 60,000 low-cost and cities in Myanmar to cope with the rapid urbani6ation affordable homes across Myanmar, or an average of process, recent urban policies have started 10,000 units per year. The goal of building a million recogni6ing the issue of informal settlements. homes by 2030 depends heavily on DUHD's capacity, Addressing the issue of slums has not gained which is currently far from meeting the demand (Table adequate policy relevance in the past few decades due 3.7) (ADB, 2018b). to its political and technical complexity (DIIS, 2017). Table 3.7: Low-Cost and Affordable Housing Projects Completed by DUHD (2010-2016) Period Yangon Region Other Towns Construction Cost (million Kyat) Buildings Family Units Buildings Family Units Total Cost Cost per Unit 2010-11 27 336 6 46 6,075 16 2011-12 266 1,223 12 130 30,254 22 2012-13 231 1,204 - - 43,282 36 2013-14 186 2,380 77 738 69,927 22 2014-15 218 5,678 64 1,248 131,442 19 2015-16 249 6,993 69 2,220 131,336 14 Source: ADB, 2018b.. Original source: Department of Urban and Housing Development, Myanmar Statistical Yearbook, 2016 39 3.4.5 NATIONAL HOUSING POLICY HOUSING FINANCE AND STRATEGY Housing finance in Myanmar, both supply (financing Management of the housing sector, including urban for housing developers) and demand (financing development, has been devolved to the states and for home buyers), remains underdeveloped. The regions under the 2008 Constitution. However, at the general financial system in Myanmar is small and policy level, DUHD plays an important role in building underdeveloped, with access to basic financial the capacity of states and regions in developing the services extremely low. Currently, only 23% of adults appropriate policies and action responses to housing in Myanmar have access to an account at financial situations (Ministry of Construction, 2016). institutions, compared to nearly 80% in Thailand and 90% in Malaysia (Ibid). Housing finance is furthermore Committed to providing "appropriate affordable a small proportion of the total credit market, and housing for all in sustainable inclusive communities:' access to housing finance is even more limited. DUHD initiated the process of preparing a National Housing Policy in 2014. With support from UN- As with most banks, only higher income households Habitat, a National Housing Policy and Strategy was qualify for a housing loan as prices for houses prepared in 2017, which aims to provide a blueprint for that can serve as an acceptable collateral for the government action in support of Myanmar's housing loan are typically high. The underdeveloped and and urban communities. The strategy involves two restrictive financial system makes housing financing approaches (Table 3.8), one which focuses on the inaccessible to the majority of the population. For development of a moderni6ed formal housing sector example, housing loans are generally non-amorti6ing, for the middle class, and the other which focuses with interests only loans for a maximum term of on the large numbers of poor informal/semi-formal one year; the Central Bank has, however, recently communities residing in housing made of traditional allowed some flexibility in the repayment term, which impermanent materials with limited services (UN- can now go up to 3 years (Ibid). Other challenges are Habitat, 2017). summari6ed in Table 3.10. In addition to the National Housing Policy, laws and regulations pertaining to building codes and construction permit systems, including the Urban and Regional Development Planning Bill, National Housing Development Bill, and Myanmar National Building Code, have been in preparation (Table 3.9), however have not been enacted yet (JICA, 2018). 77-~- Table 3.8: National Housing Policy and Strategy 2017 Approach Formal Market Informal/Semi-Informal Market Establish the rule of law, through: Encourage people to earn livelihoods without * Formali6e land title and land and housing undue interference or harassment, while improving transactions community safety and quality of life, through: * Nominate a single responsible body for decisions, Land for incremental building, with a range of avoiding legal and procedural overlap plot si6es, paying attention to access and right- * Lay out Master Plans and five-year development of-way, livelihoods and inclusiveness plans that allow for projected urban expansion Settlement upgrading according to good and seek to acquire and release land in a timely practice, with certificates of occupation fashion Building community solidarity and * Establish transparent clear approval processes representation integrated locally within one-stop shops, while following national and local plans * Establish a formal financial sector with contract-based loans and mortgages General principles of market economics and General sustainability principles are to be consumer-driven choice are to prevail, through: supported in all activities, including: * Producing a range of unit types according to Low footprint demand Resilience and disaster readiness * General principles of full costing with Inclusiveness and democratic rights transparent subsidy Attention to cultural values, ethnic identity, * Greater competition in all markets including gender finance, small and medium enterprises to Support of vulnerable groups provide variety and customi6ation * Value capture on speculative land profits, land banking solutions * Development of a formal rental sector Source: UN-Habitat, 2017 Table 3.9: Status of Laws and Regulations Related to Housing Urban and Regional * Defines the establishment of Urban and Housing Development Region/State Development Planning Committees, including the tasks and and types of plans to be formulated. Bill * Status: The Bill has been drafted and approved by the MoC December 2014, submitted to the Union Attorney General Office (UAGO) for comments, and is under final revision based on comments from UAGO. National Housing * The bill covers the regulation related to the use of public land for housing, Development Bill supply of housings, and establishment of committees in the state/region and autonomous local government levels. Status: The bill has been drafted and approved by MoC, submitted to UAGO for consideration, and is under final revision based on comments from UAGO. Myanmar National * The Myanmar National Building Code (MNBC) is the unified building code Building Code for the country, which aims to provide city planning standards for building permitting to ensure security and safety during disasters and improve the living environment. MCBC also aims to standardi5e architectural design and construction, which has been developed with the support of the Myanmar Architect Council (MAC) and Myanmar Engineering Society (MES). * Status: MNBC has been approved at the cabinet meeting and is regarded as the guideline for building permits for local authorities. Source: JICA, 2018 41 Table 3.10: Challenges of the Commercial Sector Housing Finance * The weakness in the enabling environment and overall financial infrastructure * Restrictions on the loan term to one to three years, and the related use of interest only loans * Restrictions on the interest rates lenders can charge for different loan products * The lack of a chapteral title law, where multi-family housing is the dominant urban house-type (which a new condominium law has come into effect, the apartment law is not still in place) * The requirement that the property has to be fully paid for in order to obtain a title * High transaction costs to transfer title limiting secondary market transactions in housing * Lack of data to inform risk assessment for underwriting of housing loans (such as the lack of reliable income data and the lack of credit information bureau) * Loan to value calculations for most banks are quite conservative * Loans to private developers are based on the same collateral principles are individual loans (i.e. there is no project cash-flow based lending) Source: ADB, 2018b However, Myanmar has made significant efforts In addition to CHDB, MoC also set up a Revolving Fund towards improving the domestic housing finance to support the construction of low-cost housing units system. In 2013, under the initiative of MoC, the in 2014. The Revolving Fund is intended as a project government established the Construction and financing mechanism to bridge the two- to three- Housing Development Bank (CHDB), asa development year period from construction to sale completion. bank with semi-government ownership, to stimulate The Union Government released 100 billion MMR housing construction by providing affordable loans to the Revolving Fund, enhancing DUHD's capacity to potential developers and home owners. CHDB, to undertake more housing projects". With the which received a commercial banking license from the additional sources from the Revolving Fund, in 2016, Central Bank of Myanmar in 2014, is intended to meet DUHD was able to increase its housing delivery by the requirement for a speciali6ed financial institution 33 percent from the previous year. As the program is that extends long-term housing loans at affordable still young, the leverage effect of the Revolving Fund interest rates (Ibid). The microcredit loans are (specifically the cash-flows from the housing sales intended for poor households and mainly for housing that would replenish the Fund) will require a thorough of 40 square meters built at a cost of MR10 million analysis in the near future (Ibid). (excluding the cost of land which is subsidi6ed by the government) (ADB, 2017a). CHDB can provide loans of up to 70 percent of the total cost of development projects, which means that a potential home owner must self-finance the remaining 30 percent (Ministry of Construction, 2016). CHDB has been providing loans to housing developers through project finance, as well as through retail housing finance to home buyers. However, there remains a huge unmet demand. Given this challenge, various development partners, including Japan and Korea have been providing technical assistance for CHDB's capacity building. Under the Housing Finance Development Project (2018-2022), for example, JICA will provide a 15 billion JPY loan, administered by the Myanmar Economic Bank (MEB), to allow CHDB to finance retail mortgage loans at low interest rates with a term of up to 15 years (ADB, 2018b). 17 Other funding sources for DUHD include government budget allocation of around 60 billion MMR per year, and project loans from CHDB at around 82 billion MMK in 2016-17) (ADB, 2018b) 42 3.5 INFRASTRUCTURE AND BASIC SERVICES The needs for urban infrastructure and basic services These limitations have negative outcomes on health are massive. One estimate finds that for Myanmar to indicators, ability to increase income generation keep pace with its' infrastructure needs in large cities from home-based microenterprises, and for those alone, approximately $146 billion would be needed in periphery areas, exclude them from access to job between 2010 and 2030.18 According to this estimate, markets due to the limited availability of roads or close to 60 percent of the urban capital investment access to public transport. would likely be required for residential housing; more than 10 percent for commercial real estate; over 20 In general women are particularly affected by percent for hard infrastructure such as water, sewage, inadequate service delivery as they are typically power, waste, roads, and mass transit; and more than responsible for household management. Women's 5 percent for soft infrastructure including health care, safety is also placed at risk through inadequate education, public administration, and social services sanitation infrastructure. In Myanmar's slums, open such as fire brigades and police buildings. While this defecation, which often takes place at night for the estimate is very approximate and can be contested, sake of privacy, subjects women and girls to greater there is no doubt that the investment needs in cities risk of attack." Even when shared sanitation facilities are huge. are available, studies have shown that harassment and gender-based violence is more likely to occur Those living in informal settlements are most affected at toilets that are located away from home (Tacoli, as access to even the most basic services is limited. 2012). Figure 3.7: Investment Needs in Myanmar's Large Cities, 2010-2030, McKinsey Global Institute Investment Asset type Asset category City administration I Soft infra- structure Education 5 9 Health care 3 Sewage 11 Waste I Hard infra- Roads 2 32 structure VWater 6 Power 6 Urban transport 7 Raett Commercial real estate 17 real estate 87 Total 146 Note: Numbers may not sum due to rounding. Source: McKinsey Global Institute Cityscope 2.0 database; Pike Research; Japan International Corporation Agency; McKinsey Infrastructure Practice benchmarks per asset type; McKinsey Global Institute analysis 18 McKinsey Global Insitute, 2013, Myanmar's moment: Unique opportunities, major challenges. Note: These estimates assume that Myanmar's large cities reach infrastructure levels in 2030 similar to what we see today in cities of comparable si5e in China, Indonesia, South Africa, and other developing countries 19 2014 Myanmar Population and Housing Census Thematic Report on Housing Conditions and Household Amenities, published by the Government of Myanmar and UNFPA 43 3.5.1 URBAN MOBILITY AND importance of urban mobility and accessibility to TRANSPORT livable, equitable and competitive cities, YUTRA sets out a development objective to "Ensure mobility Urban mobility is essential to spatially inclusive urban and accessibility to urban services that are vital for developmentasitallowspeopletoaccessjobs,services the people and the society, by providing a transport and city resources. If segments of the population have system characteri6ed by safety, amenity, and equity challenges in moving around due to access and where and sustained by an efficient public transport system." they live, cost, safety, or discriminatory practices, (JICA, 2014). this can affect their inclusion in urban life. Conditions for Myanmar's urban transport have Trip rates - the average number of trips per person rapidly declined since 2012. With the economic per day - are a way to measure mobility in cities. recovery and 2011 relaxation of restrictions vehicular In the 2014 Comprehensive Urban Transport Plan imports and licensing, the number of private vehicles of the Greater Yangon (YUTRA), prepared with the has rapidly increase in major cities. In the case of assistance of JICA, the person-trip survey concluded Yangon, the vehicle fleet grew by 37 percent between Yangon's trip rate at 2.042 for all trips generated 2012 and 2015 - the number of cars increased by (Table 3.11). In most Asian cities, the trip rate ranges double while the number of motorcycles increased by from 2.0 to 2.5, suggesting that the mobility is Yangon 3.6 during that time (Figure 3.8) (ADB, 2016). is lower than other regional cities. Recogni6ing the Table 3.11: Trip Rates in Yangon (2013) Mate Female Total All Trips 2.199 1.904 2.042 Excluding Walking 1.472 0.923 1.179 Source: JICA, 2014 Figure 3.8: Vehicular Fleet in Yangon 800,000 - 700,000 600,000 500,000 400,000 - 300,000 200,000 100,000 I407 620 670 ' t 0407 '0207X) Y, 70 )Y09 FY'2710 FY2011 FY2012 F6Y201 3 FY2014 Traleq He-Vy mchne - 71 377 435 Thrro wholer 132 2,567 2756 2515 2,243 1 2,0 1 036 658 1189 1546 2,132 2,570 The h K- - - - - 52 4R 145 44 618 1415 2316 Motocyd. 21,442 3,466 3310 3,162 3,013 42,416 46,539 50 660 567.34 113,651 161,236 204 680 B 4835 7746 7694 8052 9151 9903 104 1 11463 11897 14,791 21820 27819 9,041 9,997 9,882 10,415 10.674 10,783 10 592 1388 11,984 11,414 15,493 16,012 -k (h-" vduty) R,t2 8,843 912 92 44 9703 9 624 10252 11263 10914 13234 17820 179r T-i (lqhtdory) 13,45 12,464 1-630 13.717 13.943 14012 14.561 15,813 16411 17206 S7997 K' 7 0ghd.uty} Ca 1019 117 129 122159 126,4 144,0OR 142 969 149,415 199025 159,461 19),969 1079 60 Ca7rs Source: ADB, Myanmar Transport Sector Policy Note - Urban Transport, 2016. Original Source: Road Transport Administration Department 44 Public and active transport has been the dominant While the survey results seem promising for a transport mode for major cities in Myanmar, however walkable and sustainable city, it also suggests the with strong variation in modes between various weak capacity for urban mobility. This concern is cities.20 In the City Life Survey conducted by the highlighted by the steady decline of share of public Asia Foundation in 2017, residents of townships in transport modes, resulting from the weak operation Yangon expressed a dependence on public and active and slow implementation of a well-functioning public transport for traveling between home and work (Asia transport systems. In Yangon, there are two types of Foundation, 2017). This is consistent with the person- local bus services: the first type involves about 5,000 trip survey results of YUTRA, whichshowthat walking small or individual bus operators managed under accounts for 42.2 percent, bicycle 13.0 percent, and nonprofit bus control or bus line committees, and the bus 28.5 percent of all trips generated (Figure 3.9). second involves two large bus companies, the Golden The high modal share in walking suggests that work, City Link and Bandoola Transportation, which provide school, and other activities most likely occur in a si6ableandprofitableservices.However,withoutdated walkable proximity to home. fleets and other convenient transport modes, bus services have been steadily losing customers at a rate of 10 percent each year, with volumes in 2015 half of those in 2017 (Figure 3.10). Two thousand buses have recently been purchased for Yangonfrom China by the Yangon Bus Public Company (YBPC), a public-private joint venture majority-owned by the city government. Figure 3.9: Modal Split in Yangon, 2013 (%) Water Ferry Water Ferry Water Ferry Railway 2.5% RalIwa 3.2% Others Railwa 14 1.1% Others 1.4% 0.3% Tru Others Truck / 0.2% Truck Motorcycle 0..4%-- 1. 3% 1 .7% 9.3% Birycle Car/Van Bus 22.5% 10.5% 28.5% *Ta 42.2%Taxi Motorcycle 9.9% Bus 7.2% 49.4% Car/Van Bus x 8.1% 63.8% 4.4% BIycLe Taxi Car/Van 13.0% 77% 4.7% / Motorcycle 4.2% For All Trips Excluding Walk Excluding Non- motoriSed mode 1 Walk Bicycle Motorcycle Car/Van Taxi Bus Truck Railway 0 Water Ferry Others Source: JICA, 2014 20 Private includes personal motorbike and car, Active includes walking and biking, Public includes trishow, motorbike taxi, taxi, ferry and bus 45 Figure 3.10: Public Transport Volume in Yangon (million passengers/year) 1,200 1,000 800 6 00 .. 400 200 0 FY2004 FY2005 FY2006 FY2007 FY2008 FY2009 FY2010 FY2011 FY2012 FY2013 FY2014 U Railways Private buses Public buses Source: ADB, 2016 Outside of Yangon, cities are experiencing the rise of A combination of time constraints, cultural norms private motorcycles (in Yangon, motorcycle share is and the risk of gender-based violence has restricted low as they have been prohibited from entering the women's mobility more than men's in Myanmar. city center). In Mandalay, one million two-wheelers Particularly in areas of conflict, where both gender- account for more than 90 percent of trips, where based and other types of violence are more prevalent, motorcycles account for 70 percent of trips (ADB, travel for women can be limited. 2016). In Taunggyi and Hpa-An, the dominant mode of transport was private motorcycles at 59 percent Furthermore, the conditions of urban mobility remain and 55 percent respectively (Asia Foundation, 2017). a critical challenge in densely populated informal settlements and resettlement areas in Myanmar With rapid increase in personal vehicles as well as which lack access to basic infrastructure and services challenges in public transport, traffic congestion including paved roads and are often located in city has emerged an urgent challenge. The Yangon peripheries. In Yangon, 54 percent of the informal City Development Committee (YCDC) estimated settlements have internal road networks provided by that vehicle speed, which reached 30 km/hour at the government or built by the community, but most peak hours in 2007, dropped to 10-15 km/hour by roads are unpaved and only 1.2 percent of the roads 2015 (ADB, 2016). Furthermore, motori6ation has have drainage. Many informal settlement areas are jeopardi6ed road safety. In the 2017 City Life Survey, flooded during the rainy season due to lack of drainage 54 percent of respondents agreed or strongly agreed systems (UN-Habitat and Cities Alliance, 2017). to the statement, "I am worried for my physical safety when riding in a motor vehicle on the roads in the city" With such urgent challenges in urban transport, - with 45 percent agreeing/strongly agreeing for the several pressing needs have been identified in Table townships in Yangon, 70 percent in Taunggyi, and 51 3.12 with different degree of urgency (based on percent in Hpa-An (Asia Foundation, 2017). implementation cost and base demand). 46 Table 3.12: Urban Transport Needs Yangon Mandalay Other Traffic Engineering and Management: Short-term Short-term Short-term Increase traffic carrying capacity though low-cost traffic management such as signage, signal lights, channeling, removal of on-street parking, management of street vendors, etc. Improve Pedestrian and Bicycle Safety: Short-term Short-term Short-term Improve the pedestrian facilities such as sidewalks and crossings, segregated bicycle lanes, off-street parking, etc. Demand Management: Short-term Medium- Medium- Limit the rise of personal cars through transport demand term term management measures such as taxes on vehicular purchase, registrations, fuel, parking and other measures to discourage low-occupancy vehicles. Road Network Development: Medium- Medium- Medium- Selective investments in road network improvement/ term term term upgrading and development. Bus Reform: Short-term Medium- Medium- Facilitate bus reform with a focus on regulatory objectives term term (enhance safety, reduce undesirable behaviors such as illegal stops, and improving incentives for drivers and users). Reform should also aim to improve bus services via operational performance standards, effective operator engagement, regular hours of operation, and infrastructure as bus-stops. Mass Rapid Transit: Under Long-term Long-term Cost-efficient mass rapid transit (MRT) such as Implemen- segregated bus rapid transit (BRT) on main arteries and tation upgrade of Circular Railway. Institutional Development: Short-term Medium- Medium- Yangon: Strengthen and consolidate YRTA as the term term overarching transport authority for urban transport, with a vision for a hierarchically integrated transport system for Yangon Mandalay: Establish an overarching transport authority for urban transport to bring together relevant agencies, jurisdictions, and levels of government. Source: Based on ADB, 2016 47 Various development partners have been working Furthermore, in 2015, JICA singed an ODA Loan closely with Myanmar, both atthe national and regional Agreement for the Yangon Circular Railway Line level, to tackle the challenges of urban transport. Upgrading Project (24.866 billion JPY) which is to JICA has been the most active development partner be completed in April 2020 (JICA, 2015). The ODA in the transport space, and has provided technical loan for the railway project is augmented with a assistance for the development of the Strategic Urban grant aid for Enhancing Railway Operation Safety Development Plan of the Greater Yangon (SUDP 2013), Project, Installation of Operation Control Center National Transport Development Plan (2014), YUTRA System Project, and the Yangon-Mandalay Railway (2014), and the preparatory study for Yangon Urban Improvement Project Phasel (25 billionJPY) and Phase Mass Rapid Transit (YUMRT 2015). 2 (56.622 billion JPY) (Ibid). The Asian Development Bank (ADB) is also a strong development partner for Under YUTRA, two Bus Rapid Transit (BRT) corridors Myanmar's transport sector. were proposed with a preliminary feasibility study - BRT 1 route along the Sule Pagoda Road, Zoological Garden Road, and Bahan Road, and the BRT 2 route 3.5.2 URBAN WATER along Rhone Gyi Street and Pyay Road. Ultimately, a less ambitious version of JICA's proposed plan, While Myanmar has abundant natural water sources, called the "BRT Lite" System was chosen for there is seasonal and regional variability. In the implementation through a public private partnership Delta region, which includes Yangon, access to safe (PPP) scheme. The cost of the BRT system, estimated drinking water varies substantially according to the at 19.2 million USD, was fully financed by the PPP wet, dry and cool seasons, and a third of individuals entity called Yangon Bus Public Company (40 percent in the Delta region, including the Yangon area rely on funded by the government and 60 percent funded by rainwater collection as their primary drinking water private companies and public shareholders). BRT Lite source. Outside of the wet season, two thirds of them commenced operations in February 2016 and runs switch to alternate surface water sources that may be along Yangon's two main commuter routes, Pyay Road unsafe for drinking (Figure 3.11) (World Bank, 2017a). and Rabar Aye Pagoda Road with route extensions planned for the near future (Win, 2015). BRT Lite As shown in Table 3.13, there is no single institution charges a flat rate of 300 kyats per ride (around 0.24 responsible for the overall management of Myanmar's USD) and operates from 6:00 am to 7:30 pm. Figure 3.11: Sources of Drinking Water in the Dry Seasons Tanker/truck 100% ----- River/stream/canal 90% 80% Pool/pond/take/dam/ stagnant water 70% Unprotected well/tank 60% Rainwater collection/ 50% tank Bottled water 40% Safe Bottled water 30% Water Tube well, borehole 20% Source *11 Public water system 10%- into dwelling or plat 0% 0 Public tap Hills Dry Delta Coastal Note: Figures are population weighted, and therefore reflect the share of individuals living in households with various sources of driving water. Source: World Bank, 2017a 48 Table 3.13: Institutional Responsibilities for Urban Water Supply and Wastewater Mate Female Overall Sector National Water Resources Committee, under the Ministry of Transport Planning Yangon, Mandalay, City Development Committee City Development Committee Nay PyiTaw Provincial Capitals, Township Development Committee, Township Development Committee, Large Towns under the Chief Minister under the Chief Minister Small Towns Ministry of Agriculture, Livestock Not officially designated, de-facto and Irrigation, Department of Rural the Ministry of Agriculture, Livestock Development and Irrigation, Department of Rural Development water resources and the sector's leadership is not well have developed their own private or shared water defined. For example, responsibility for urban water sources, which are often unsafe and not sustainable falls under three different government entities. (UNICEF, 2015). It is estimated that a third of urban dwellers rely on bottled water for drinking (ADB, The government faces significant challenges to 2017a). Even in Yangon and Mandalay water is only providing reliable and safe water services. The urban partially treated. Urban water supply systems that access rate for water supply is 94 percent, yet only do exist are generally very old and in poor condition 18 percent have piped water supply to the premises and, as a result, most urban residents experience (UNICEF, 2015). While the accessibility data look intermittent supply and poor quality. comparable to those in other Southeast Asian countries, the health data tell a different story. Under The water services in Myanmar are generally funded 5-year child incidence of diarrhea and child mortality by operational budgets from City Development rate (66 per 1,000 live births in 2010) are higher than Committees (CDCs) or via local or federal government elsewhere in Southeast Asia. There is persistent high subsidies, rather than from customer generated prevalence of diarrhea-related diseases, including revenue. Where tariffs exist, charges are decided by cholera, dysentery, typhoid, and viral hepatitis, and each city/town and these tend to be set at very modest water-related vector-borne diseases such as malaria, levels and seldom cover operating costs. Therefore, dengue, Chikungunya fever, Japanese encephalitis. the sector's current financing model marginali6es These health risks are significant and result from: revenue generation and increases dependency on i) the underinvestment in preventative health care; subsidies and donor support. and ii) underinvestment in, and less than optimal operation and maintenance of, water, drainage, and The Yangon water supply system is operated by the sanitation infrastructure. Department of Engineering (Water and Sanitation) under YCDC and takes water from four reservoirs. Nearly all urban areas in Myanmar have suffered YCDC water supply has a relatively low service chronic under-investment in urban water coverage, providing piped water to approximately infrastructure (UNICEF, 2015). There are marked 33 percent of the urban population in Yangon differences in water service provision between the (approximately 230,000 household connections, largest cities and smaller cities and towns, with of which 70 percent are metered). The remaining urban water supply generally a neglected subject population is reliant either on tube-wells operated beyond the state capitals. Thus, most urban water by YCDC or private water supply sources (ADB, supply is untreated, and likely to be contaminated 2018a). In Yangon's slums, an estimated 22 percent by bacteriological contaminants (and arsenic in the of households have access to piped water, 21 percent Ayeryawady delta groundwater). Networked services use untreated water from ponds, and another 23 rarely exist in most smaller cities and many residents percent rely on shallow tube wells (YCDC and Save 49 the Children, 2016). Most of the city's water supply is, such as i) development of water source, treatment therefore, untreated and likely to be contaminated by plant, and transmission of system to increase water bacteriological contaminants. supply coverage; ii) creation of a distribution district including a service reservoir, distribution pump, and The water supply system in Yangon is also distribution pipe to ensure equitable water supply and characteri6ed by high N RW (estimated at 65 percent21) NRW reduction; and iii) installation of disinfection and low water tariff (domestic users in Yangon paid equipment (JICA, 2018). Furthermore, long-term US$0.10/m3 in 2013, lower than comparable cities plans have been revised and updated (Figure 3.12) in the region (US$0.27/m3 in Bangkok and US$0.19/ based on results from the Preparatory Survey Report m3 in Ruala Lumpur)). ADB estimates that despite on the Project for the Improvement of Water Supply, the recent increase in level of fees by YCDC, the water Sewerage, and Drainage System in Yangon City tariff is not sufficientto coverthefull operational costs (2014) and Preparatory Survey for Greater Yangon (ADB, 2017a). These challenges are compounded by Water Supply Improvement Project Phase 11 (2017), the increasing demand for water due to urbani6ation assisted by JICA. and a growing population. The state of water supply services in Mandalay is There is a need for upgrading, expansion and reform. similar to that of Yangon. The service is managed by JICA has been the major development partner in the the Mandalay City Development Committee (MCDC), water sector in Yangon. The Greater Yangon Water with piped water coverage of around 55 percent, and Supply Improvement Project, for example, is expected the remaining urban population relying on private to be completed in 2022 andwill investinimprovements shallow-wells. N RW is estimated at approximately 52 Figure 3.12: Revised Water Supply System for Greater Yangon (2025 and 2040) W ruys in 2025 Wt SR s f s a s o iropte m f 50istig4MO- Lwatersppty System in 2025 JWater Suppl System in04 Source: J ICA, 2017 21 Without functioning production, 6onal and customer metering an accuirate assessment of NRW is impossible. Thus, this figure is based on World Bank staff estimates from similar cities 50 Table 3.14: Water Supply Components of MUSIPI and MUSIP2 Subsector MUSIP1 (April 2016 - March 2023) MUSIP 2 (April 2020 - March 2027) Water Supply System Households with access to water The number of households with access supply without interruption increased without interruption further increased from 19,000 (2014) to 124,000 through the construction of new water (2024) through the upgrading of intake at Dothtawady, expansion of water treatment plant and reservoir, distribution networks, increase of rehabilitation and construction of connections, and non-revenue water distribution networks, replacement of reduction. connections, and non-revenue water reduction. Source: ADB, 2017b percent, of which around 70 percent is due to physical drains, causing severe environmental impacts and loss from faulty meters and leaks (ADB, 2017b). pollution of water courses and ground water (ADB, Through the Mandalay Urban Services Improvement 2017a). Project (MUSIP) Phase I and MUSIP Phase II (currently in preparation), the water supply system in Mandalay In Yangon and Mandalay, responsibility for the are to be improved as summari6ed in Table 3.14. management of urban sanitation system lies with the Department of the Department of Engineering The JICA Grant Aid Project for Improvement of (Water and Sanitation) under YCDC and MCDC, Water Supply System in Mandalay (signed in 2015) respectively. This includes the collection of any fees will further provide 2.555 billion JPY to construct a related to the collection, treatment, and disposal of water supply system in Pyi Gyi Tagon Township and septage and the use of sewage systems. Campaigns disinfection facilities for the existing water supply to improve sanitation systems and awareness is the facilities in Mandalay City to increase the number of responsibility of the Department of Health (ADB, population served with piped water and to secure safe 2017a). drinking water (JICA, 2015). Yangon's sewer system is 120 years old and dates back to the colonial period. Service coverage is extremely 3.5.3 URBAN SANITATION low, approximately only 350,000 people, which is less than 10 percent of the city's population (JICA, Sanitation is essential to urban livelihoods as 2013). Prior to the new wastewater treatment plant, absence of proper sanitation facilities can lead to which was completed in 2015, the city's wastewater diseases such as diarrhea, cholera, trachoma and was discharged untreated into the Yangon River, other waterborne disease outbreaks. In Myanmar, causing severe pollution (Ministry of Construction, 96 percent of the population in urban areas have 2016). Improvement of the sewerage system (both access to improved sanitation, either a flush toilet or infrastructure and operational service) is an urgent water-sealed latrine (MPLCS, 2015) and only three challenge forthe city and has been highlighted inJICA's cities (Yangon, Mandalay and Nay Pyi Taw) have SUDP. SUDP's master plan covers the construction of piped sewerage systems or centrali6ed wastewater six additional sewerage treatment facilities in various treatment systems. Most households outside of these townships, which is anticipated to cover 49 percent of three cities, in formal residential areas, have septic Yangon's total population (JICA, 2013). tanks but these are not routinely serviced or treated and there is no systematic collection and treatment In Yangon's poor urban neighborhoods, only 5 percent of domestic wastewater. Households in informal of the surveyed households had toilets connected settlements rely on improvised latrines and storm- to concrete tanks that can be considered improved water drains that carry untreated sewage in open sanitation facility. Forty-six percent households used channels. Furthermore, small-scale enterprises and open pit latrines overflowing during the rainy season, industries often allow chemical waste (such as dyes and another 37 percent household sewage went to for silk and weaving cloth) to run into the roadside open drains and ponds. Some informal settlements 51 Table 3.15: Wastewater Management Components of MUSIPI and MUSIP2 Subsector MUSIP1 (April 2016 - March 2023) MUSIP 2 (April 2020 - March 2027) Wastewater Direct discharge of wastewater to receiving BOD loading to environment reduced Management waters reduced from 85,000 m3/day through increase of wastewater (2014) to 25,000 m3/day (2024) through treatment capacity, improvement construction of wastewater treatment plant, of treatment process, expansion of construction of interceptor along Thinga3ar interceptor and sewerage networks, Creek, construction of sewerage networks, construction of household connections, and improvement of septage treatment. and improvement of septage treatment. Source:ADB, 2017b in the low-lying or riverside areas are flooded most of 3.5.4 SOLID WASTE MANAGEMENT the year and the sewage goes directly to the flooded areas surrounding the houses (UN-Habitat and Cities Solid waste management (SWM) is essential to urban Alliance, 2017) (YCDC and Save the Children, 2016) livelihoods as absence of services will lead to serious This creates enormous health and environmental environmental and public health issues. With rapid risks for those in slums. economic growth and shifts in consumption and production patterns since 2012, waste generation has Most of Mandalay is not served by a centrali6ed significantly increased in Myanmar, causing urgent sewerage network or wastewater treatment plant. challenges for the nation. In general, SWM in Myanmar The majority of the wastewater ends up in open requires significant improvements. Collection is drainage channels which are then further discharged labor intensive, landfills remain open dumping sites, into rivers and lakes. Under the MUSIP Phase 1 and 2, recycling is undertaken mainly by informal sector, ADB intends to improve wastewater management in and large amounts of uncollected waste are open Mandalay as summari6ed in Table 3.15. disposed in drains and canals, causing degradation of environment and public health, breeding opportunities Adding to country's water pollution challenge is the for mosquitoes and other waterborne diseases, as industrial wastewater coming from the regional well as increases in flood damages due to reduction industrial 6ones. According to the Pollution Control of drainage capacity (ADB, 2017a). Safety measures and Cleaning Department (PCCD) under YCDC, within for SWM workers, whether in the formal or informal Yangon's 24 industrial 6ones alone, only 188 out of sector where many of the urban poor work, are often the 3,474 factories had proper wastewater treatment inadequate. facilities, while most factories disposed their wastewater in creeks and rivers which channel into It is estimated that in Yangon, approximately 1.7 major rivers in the region. Regions outside of Yangon million tons of municipal solid waste are generated face a similar situation. While Myanmar has enacted per year, out of which 870,000 is received at the wastewater related laws and regulations such as the dumpsiteS22. In Mandalay, about 408,800 tons of EnvironmentalConservationLaw(2012),Environmental municipal solid waste are generated per year, out of Conservation Rules (2014), and Environmental Impact which 342,000 is received at the dumpsites. While Assessment Procedure and Environmental Quality there are no formal statistical data regarding the (2015), effective implementation remains a challenge amount of municipal solid waste generated and (Aung, 2017). collected, the estimates suggest that from Yangon and Mandalay alone, 900,000 tons per year does not reach the dumpsites and is lost scattering around in the cities or thrown in rivers and streams. Central parts of the cities are covered better, but poorer parts and more industrial parts show substantial littering.23 22 Estimates are excluding the "floating" population who add more wastes in informal settlements 23 Higher percentages of waste being formally collected are estimated by the city governments, but the information on scattered waste throughout suggests that the actual waste being brought to the formal dumpsites is lower than the total waste generated 52 Table 3.16: Major Landfill Sites in Yangon and Mandalay Location Capacity (ton/day) Condition Status Yangon City Development Committee (YCDC) Hteinpin 1,080 Open Dumping Operating Dawai Chang 843 Open Dumping Operating Shwepyithar 61 Open Dumping Operating Mingalardon 43 Open Dumping Operating Dala 33 Open Dumping Operating Seikyi Rhanaungato 4 Open Dumping Operating Mandalay City Development Committee (MCDC) Ryar Ni Ran (North) 450 Open Dumping Operating Thaung Inn Myount Inn (South) 300 Open Dumping Operating New Breway Factory 142 Open Dumping Closed in 2009 New Kandawgyi Lake 80 Open Dumping Closed in 2009 New Zanngkalow Pond 28 Open Dumping Closed in 2007 Corner of N/E Mandalay 450 Open Dumping Closed in 2013 Source: Institute for Global Environmental Strategies, 2017 Formal waste collection and disposal in Myanmar in open spaces, roadsides, rivers, or ponds, further has traditionally been under the responsibility of exacerbating poor sanitary conditions (UN-Habitat townships and the CDCs. Forthethree majorcities, the and Cities Alliance, 2017). However, although large PCCD under CDC and their administrative branches amounts of household solid waste remain uncollected, are responsible for SWM in their respective municipal the informal plastic collection and recycling chain is areas. Most municipal governments have limited si6able, helping to recycle plastic waste and providing budgets and facilities for SWM, and private sector a source of income to thousands of households in involvement is very limited at this stage. Primary Myanmar (Netherlands Enterprise Agency, 2017). waste collection in Myanmar is labor intensive, using either the bell system (door-to-door), block or The insufficient collection and dumping of wastes container collection method, often without adequate causes environmental and health problems, but safety measures and equipment for the handlers. also specific problems regarding water safety: (i) Primary collection is carried out by push carts and blockage of drainage systems leading to flooding, tricycles, while secondary collection is carried out specifically in monsoon season; (ii) blockage of sewer by dump trucks (Institute for Global Environmental system lead to flooding of sewerage and potentially Strategies, 2017). Solid waste is transported to final cholera outbreaks; (iii) waste dumped in surface disposal sites through transit stations, typically water damages ecosystem and contaminates located along streets. Open dumping sites are in water resources for drinking and irrigation water various locations (Table 3.16). purposes; (iv) waste in pools, specifically adjacent to residential areas and markets and public spaces, In slums, conditions are even worse with very limited create potential breeding grounds for vector borne access to municipal, community-organised, or diseases; and (iv) plastics dumped into the rivers private-sector led solid waste management services. contribute to the ocean plastic "soup". The problem Littering is widespread, and waste is left uncollected, of solid waste mismanagement contributing to with most slum residents dumping their garbage problems regarding water safety is recogni6ed in the 53 Yangon area and the same issue can be found at any there are a range of policies, laws and regulations on scale of settlements located on river systems across environmental conservation and pollution control, the country (Netherlands Enterprise Agency, 2017). however, there are none directly addressing SWM in The Irrawaddy river in Myanmar is positioned as the a holistic manner. Furthermore, weak enforcement placed at ninth place in terms of the top 20 polluting and monitoring capacities are a major barrier to rivers contributing to the ocean plastics problem24. implementing effective SWM practices. At the local level, Yangon, Mandalay, and Nay Pyi Taw As a result of insufficient funding and investments, have received technical and financial support from awareness and household engagement, there is various development partners (ADB, JICA, ROICA, EU, insufficient waste segregation and recycling neither BORDA) to establish new waste collection, recycling, by the local cities' governments or the households treatment and final disposal facilities (Ibid). itself. Waste recycling is carried out mostly by the informal sector, waste pickers and waste collectors For more advanced waste treatment solutions, who collect the recyclable materials and sell to waste increases of the revenues in the solid waste sector dealers who further clean and sort the waste for are a necessary requirement. In addition, the sharp further selling locally and abroad. There are however increase of plastics and packaging materials in insufficient statistics regarding the quantities and the waste streams and continued dumping of such types of recycled waste25. In addition, a large part of wastes into rivers and streams as well as generally the waste consists of organic material (some 70 -80 throughout the city is also an increasingly urgent percent), which generates opportunities in treatment problem. Definition and adoption of policies and by composting/digestion and sorting. investments to reduce the plastic leakage into the waterways, reduce plastic use and increase the Public revenue for SWM is generated through general potential and profitability of recycling and plastic taxes and direct revenues from collection fees. alternatives is also a key priority. Cost recovery Direct revenues for household or domestic waste strategies for SWM need to be improved to promote management are generated through user charge, a fairer cost sharing system to beneficiaries, reduce which are based on location (in the case of YCDC) or subsidies provided by the cities, and encourage sound the volume of waste disposed (in the case of MCDC), fiscal planning for SWM. and the fees may range from 300 to 900 kyats/ month. However, the collection rate of service fees from households remain low and a substantial deficit 3.5.5 DISASTER RISR between revenues and expenses for SWM exists. For MANAGEMENT (INCLUDING FLOOD commercial waste, special collection fees can range from 20,000 to 150,000 kyats/month based on the CONTROL AND DRAINAGE) volume of waste (Institute for Global Environmental Strategies, 2017). A resilience lens is critical to an inclusive and sustainable urban development. Global experience Priorities for improvement for solid waste shows that the concentration of people and goods management range from improving the collection and in cities has historically meant that urban areas are cleaning of the cities, educate and engage citi6ens to hardest hit by natural disasters, particularly the reduce littering, upgrading or closing the open dumps urban poor who often settle in high-risk areas because and construct and operate sanitary landfills without this is the only land that is available and affordable. environmental impacts and where financially possible Myanmar's urbani6ation challenge is exacerbated by more advanced waste treatment. The Ministry of its vulnerability to natural disasters - earthquakes, Natural Resources and Environmental Conservation floods, landslides, cyclones, tsunamis, fire, hail and (MOREC) has an important role to play, along with storms. relevant stakeholders to establish national level waste management policies and strategies including Myanmar ranks third place among countries most institutional frameworks, financing mechanisms, affected by extreme weather events between 1997 and enforcement and monitoring systems. Currently and 2016 in the 2018 Global Climate Risk Index 24 Lebreton, L. C. M. et al. River plastic emissions to the world's oceans. Nat. Commun. 8,15611 doi: 10.1038/ncommsl5611 (2017). 25 IGES Centre Collaborating with UNEP on Environmental Technologies (CCET), Waste Management in Myanmar, 2017 54 and over the past 25 years has suffered 24 disaster GoM and Yangon through a 117 million USD loan events, affecting more than 4 million people and and technical assistance under four components causing 4.7 billion USD in damages. In 2008, Cyclone i) strengthening the financial planning for disaster Nargis resulted in an estimated loss of 140,000 lives resilience, ii) urban flood risk management, iii) safer and property of approximately 2.4 million people, with public facilities and critical infrastructure, and iv) a total damage and losses estimated at 21 percent of Contingent emergency response (World Bank, 2017d). the GDP. The 2010 Cyclone Giri that hit Rakhine State In Mandalay, ADB's MUSIP Phase l involves a drainage caused 45 fatalities and 10 million refugees, with an and flood protection component which aims to reduce estimated financial damage of 5.7 million USD (JICA, the households living in wards affected by seasonal 2017b). As recently as 2015, the country suffered flooding through the dredging of canals and increased severe floods and landslides, resulting in 132 fatalities pumping capacity (ADB, 2017b). Furthermore, JICA and a 0.8 percentage point drop in economic growth. has supported the implementation and expansion of end-to-end early warning systems for natural In response, the Government of Myanmar (GoM) disasters (JICA, 2017b). enacted the Natural Disaster Management Law in 2013 and issued the supporting Disaster Management Urgent action is needed in some slum areas where the Rules in 2015. The rules require Ministries and population is at high risk. InYangon, an estimated one administrative units to prepare disaster management third of all settlements are located along rivers, creeks plans; however, enforcement and implementation of or on swamp land which flood frequently especially the law and rules remain a challenge (World Bank, during the monsoons. The lack of storm drainage or of 2017d). Given the frequency of natural disasters, the solid-waste disposal in slums can worsen and extend National Disaster Management Committee (NDMC) flooding. Extended flooding can result in disability and is more focused on post-disaster assistance than death by drowning or collapsing structures, sickness upstream improvement of disaster resilience and transmitted by water-borne vectors, displacement, development of management plans. Weak capacity, and destruction of property. Overcrowded slums are a lack of resources, insufficient analytics, and a particularly exposed to the rapid spread of infectious focus on disaster response together hamper the diseases that are transmitted through flood waters mainstreaming of resilience principles across sectors. (for example, diarrhea, cholera, typhoid, leptospirosis, and meningitis). Malaria- and dengue-carrying In terms of infrastructure, most cities in Myanmar mosquitoes also breed in stagnant water-especially lack proper storm water drainage networks and face when temperatures are high. Exposed wells and severe flooding during the monsoon season. In Yangon, broken water pipes elevate the risks (Baker, 2012). drainage and flood control is underthe responsibility of Engineering Department of Roads and Bridges (EDRB) of YCDC. Inadequate tertiary drainage networks and blocked primary and secondary networks result in monsoon season flooding with inundations 0.5 to 1.0 meters deep. The drainage network which consists of 22 major channels are primarily tidal and lack gates to prevent backflow during high tides and the capacities of pumping stations are insufficient to discharge excess water out of the city area (ADB, 2017a). Lack of dredging and maintenance of the storage ponds and canals also exacerbate the issue, particularly in combination with other urban sanitation challenges such as the dumping of solid waste. Mandalay and secondary cities share similar challenges. Various development partners have highlighted the urgency of mainstreaming and strengthening resilience in Myanmar's urban development. The World Bank's Myanmar Southeast Asia Disaster Risk Management Project (2017-2023) aims to support 55 vг�. -"� 4 £ °�. � Е � F Е�: � : ���..:,.._: • �. t . § � � ! . i � , ii � � : �:::; г� ^.: �:....;.:: � ., ти � � ■r �i �. . ю -� ... � � � . _ �� � : � ���� �� Ё � � тч� ' ; ; , .,, ... .. � :�� � н � .. � � � � � �� •� � �;' �к .лд .. t , ::.�у, � � . � »« ,� , � qf, ¢�у � '` ��У ��.� ' �. с. �: ` � � �,у; ь \1 � `ни� , ��� � , ...... ...: � а� � ....:;. : . а�'. �. , : , .ti � ii , ' -,. - � . - : ,:.,, � : а � . : м� � е,� _ � � �. У н ``L«. s 3 '� � � � _ � . .::.��.*��� �,?� �+7-`� �- ��. а�" � �!��s � �� � , .� ..к` � .. �.� , . !�.� � ����, .�. . r '�� �� � �и. _ '!.` � ��� �..� �' � ,л�� �! .. -�- vs��;� � .. :�- � -�' �- - - � � �� � � � � ' � � •' [ � � +� . • � я � � я 3 i � - � � а г, .. 3 н: s��' ... � : . �� � . ^�ы � . [[ . ..я. �. ' .. �� . , � ..,.-.�.._ � , , � ��-----�"� � - , � f � �� f � I � вг . ��- � � � � . � �4 � - . i s'.� "� � � - 3 � � ,, � � i � ��х � 4�� '� . �� .. r.� t. � � .."д2у 1 I�I t. . �� { vI r•�i % �"' � _ . r , t � � '� I[ . .,�' f �, f �, +� � � ` � 1 � �. , r ~ �. � � � , _,� °>� � . � �.. �' _�,. �, � � .� 3'..� � �... � k й� � •_ �f � З� ��. у ! �,�µ ��� � �� � � � KEY MESSAGES " Social inclusion is especially important in cities where the density can make inequalities particularly evident and result in social tension. " The urban poor face many daily challenges and are particularly burdened by debt which in turn has implications on the development of human capital and reduction of poverty. " Other subgroups such as urban migrants, women and the disabled face challenges finding jobs and housing making it difficult to integrate in city life. POLICY RECOMMENDATIONS " Promote equal opportunities for marginali5ed groups which will enable them to fully take part in society. " Invest in targeted social programs for some groups such as: linking migrants with job opportunities, assistance for the disabled through universal design in upgrading programs and better access to education, and addressing discrimination through policy reform and awareness raising. " Facilitate access to legal documentation by removing the current obstacles linked to migration status and ethnicity through reform of the identification card system. Social inclusion relates to fostering and enabling Inequality is higher in cities, as well as more starkly inclusive attitudes towards marginali6ed groups, evident given the density of people. Informal such as the urban poor, regardless of differences in settlements exist side-by-side with better-off gender, ethnicity or region of origin. Promoting social neighborhoods in larger cities. For subgroups, this inclusion also means facilitating equitable access plays out in various ways. For example, a citi6enship to legal status and tenure security, urban safety, scrutiny card (CSC) is needed to own property, and inclusion through participation in governance practice law, access university, apply for electricity, and decision making. Access to human capital, and buy health insurance; those who lack one report i.e. the knowledge, skills and health accumulated difficulty in buying and selling land, accessing rights to throughout one's life, is also critical for marginali6ed security, legal protection, and inheritance; difficulties groups in allowing them to reach their full potential as are also reported with getting cash transfers in social productive members of society (World Bank, 2018c). protection schemes, stipends, and scholarships.27 Strengthening human capital is thus critical to advancing equity and ensuring more inclusive growth This chapter focuses on some of the key topics (Tanaka, Spohr, & D'Amico, 2015). specific to social inclusion in urban areas in Myanmar with regard to vulnerable groups including internal In Myanmar, there are a number of subgroups that migrants the urban poor, and people with disabilities. have been identified as vulnerable to exclusion. These Gender issues, a cross cutting topic, is discussed include the urban poor, some migrants, non-Bamar throughout the report. Information on issues of ethnic groups, religious minorities (approximately 12 inclusion for ethnic groups and religious minorities in percent of the population), non-citi6ens under the urban areas was not fully available in the literature 1982 citi6enship law, and people living with disability though has been covered in other chapters for (approximately 4.6 percent of the population). specific issues particularly with regard to obtaining Exclusion also exists based on sexual orientation and Citi6enship Scrutiny Cards (CSCs). gender identity minorities (SOGI) though information on this subgroup was very limited.26 26 World Bank, Social Inclusion in Myanmar, 2017 draft paper. Myanmar's 1982 citi5enship law defines those who belong in Myanmar as members of 'national races, who need to have been present in the country before the British annexation began in 1823. The law stipulates three categories of citi6en- citi6en, associate citi6en, and naturali6ed citi6en. It is in practice difficult for those who cannot prove their ancestry to before 1823 to get full citi6enship, despite the law allowing for third generations of non-taingyinthar (indigenous) residents to have this. One in five people in Myanmar lack a citi6enship scrutiny card (CSC). Numerous groups, including those of Indian sub-continent and Chinese descent, report trouble obtaining citi6enship cards and other documents. In recent years, Muslims renewing or obtaining new citi6enship scrutiny cards have reported having to list a 'foreign' designation on their cards in addition to their ethnicity 27 lbid 59 4.1 URBAN MIGRANTS The urbani6ation process in Myanmar has been 4.1). A study of more than 7000 internal migrants dominated by migration within the country, largely in 14 states/regions of Myanmar reports that 84 driven by search for jobs, yet policies on internal percent of the interviewed households declared that migration are limited. Migration for work is known they migrated for work (ILO 2015). Some of this to bring many benefits. Individuals and households may be motivated by severe weather that destroys benefit when they can seek out opportunities for livelihoods (MOLIP and UNFPA 2016), a lack of off- wage labor in cities, remittances earned by migrant farm employment in rural areas, and seasonality of workers can ease financial constraints, move people agriculture that limits rural livelihoods (Mahajarn and out of poverty, reduce child labor, and even provide Myint 2015; World Bank and EMR 2016). opportunities for entrepreneurship. The characteristics of migrants show that they are Globally, research on social inclusion in urban areas slightly more likely to be more educated, younger, has documented extensive cases of stigma faced by male, semi- or un-skilled, and dependent children migrants who are blamed for increased crime, the than the non-migrant working age population. growth of slums, housing shortages, overburdened Close to 56 percent are male, most have a primary basic infrastructure and services, congestion, and education, but are disproportionately likely to have increasing exposure to environmental ha6ards middle high school or higher education as compared (Garland, Massounmi and Ruble, 2007). Such to non-migrants. Landless households are more likely stigmati6ation is particularly aimed at low-skilled, to have family members migrating, with internal low income migrants working in the informal sector. migration involving the poorer households that are unable to afford the cost of migrating internationally. Most migrants in Myanmar move for work (56 Finally, most migrants are children of the household percent), or to accompany those who move for work head. (ILO, 2015) (38 percent move to join a family member) (Figure Figure 4.1: Motivation for internal migration 0 To Work/Look for Work To Join Family/Marry To Move with Family Healh/Education To Escape Conflict/War/Natural Disaster V Other Source: Cunningham, W. and Muno6, R. eds., Myanmar Future Jobs: Embracing Modernity, Main Report and Background Reports, World Bank, 2018 based on author's calculations, MPLCS (2015) Notes: the category "to work/look for work" includes those who provided this response as well as their family members who reported accompany a family member". The category "accompany a family member" or "to marry" do not indicate if the family member is elsewhere due to work or due to other reasons 60 Many migrants work as micro entrepreneurs and Interviews with migrants as well as local government only 7 percent of migrant workers had a written officials reflect gaps in access to services in urban contract which exposes them to exploitation. Some areas (World Bank, 2016). Officials across ministries literature points to various problems faced by and regions all cited migration as an important immigrant entrepreneurs including poor knowledge phenomenon that has major impacts on the way they about existing markets, limited access to finance work for example with regard to urban planning, or and connections with the local population (Fairlie and the delivery of social services, but also reported that Woodruff 2010, OECD 2010, Marchand and Spiegel the lack of existing data made it difficult to know how 2014). Male migrant workers earn higher salaries and where to support migrants. than female migrant workers with the exception of the hotel industry (ILO, 2015). From the survey data, 26 percent of migrant workers were in a situation of forced labor and 14 percent in a situation of trafficking for forced labor. This was 4.2 URBAN POOR highest among the 15-17 age group, and those who had only completed lowersecondary education. Those Urban Poverty is estimated at 14.5%, which is a in situations of forced labor or trafficking were likely significant decline from 32.2 percent in 2004/5 and to earn less, work for longer hours, rely on employer- reflects the growth in the manufacturing and services provided housing and be in consensual debt. (ILO, sector.28 Despite this significant decline, many poor 2015) households, mainly dwelling in fringes of cities, still struggle to meet basic needs for living. Poor working Most of the rural migrant newcomers are the ethnic families in Yangon rely on unstable daily wages, high- Bamar majority. The numbers of ethnic Raren and interest loans, and inadequate food for survival. Over Rakhine, especially from Ayeyarwady Region, are also 80 percent of the surveyed 300 households in three significant among recent migrants. In Hlaing Thayar, peri-urban townships of Yangon lived on 2,000 Ryat there is in general no reported open tension stemmed (US$1.72) or less per person per day - lower than the from ethnic or religious differences. Yet, there are international benchmark - including 43 percent of generally more trust and community support among the surveyed households struggling to survive on less migrants of the same ethnicity group or from the than 1,000 Ryat (US$0.86) per person per day (YCDC same geographical area (DIIS, 2017). and Save the Children, 2016). The Buddhist and Christian organi6ations in Yangon The cost of living has risen steeply in recent years. also provide support to newcomers to informal Since most residents in informal settlements do not settlements. The Christian churches usually provide have access to municipal services, some have to buy more material support, whereas the Buddhist electricity and clean waterfrom informal sources such monasteries tend to provide more protection against as private generators and bottled water distributors potential evictions - it is commonly believed that at prices higher than the regular. Food is the main item residents are less likely to be evicted if there is a of expenditure for 85 to 92 percent of households monastery in the settlement (DIIS, 2017). in informal settlements in Yangon (UN-Habitat and Cities Alliance, 2017). Most surveyed households lived An exception is the minority Muslim community, who with persistent food insecurity. About 87 percent of felt discriminated and isolated. In Yangon in recent poor urban families spent merely 750 Ryat (US$0.57) years, Muslim newcomers are more likely to settle in per person per day on food and often skimped on the townships and downtown areas where there are large amount or quality of food. Protein is insufficient in existing Muslim neighborhoods, rather than the fast- many diets when rice, fish paste, and vegetables were growing settlements like Hlaing Thayar. Some Hindu the most common food in slums (YCDC and Save the migrants also expressed being discriminated, mainly Children, 2016). Enhancing food security, for example because they were often mistaken as Muslims (DIIS, expanding dried fish as affordable source of protein, 2017). will be important for basic nutrition of the urban poor. 28 MPLCS 2015 and 2017, World Bank Poverty Report. Estimate based on World Bank methodology 61 Myanmar has the lowest life expectancy among all The loans taken by poor urban households are usually the ASEAN countries. Poor sanitation conditions and for small amounts, and are used for basic needs. limited access to healthcare services have attributed Forty-four percent of loans taken by the 300 surveyed to communicable diseases such as diarrhea, hepatitis, households in Yangon were 50,000 Ryat (US$43) or tuberculosis, as well as high under five mortality in below. Over half of the loans were for food, rent, and slums in Yangon and Mandalay (International Growth other basic needs. Among those residents who had Centre, 2016). Healthcare was the second highest taken high-interest loans, over 50 percent borrowed reason behind the urban poor taking high-interest for food, and another 26 percent of loans were for loans. For example, childbirth is a major financial healthcare or health-related purposes (YCDC and burden that has led many poor womento seek cheaper Save the Children, 2016). Other reasons for borrowing but unskilled midwives at home. About 48 percent of include requiring credit to obtain official documents surveyed households experienced some major illness for job applications, or enrolling children in public in the past one year, treatment of which contributes schools. to long-term indebtedness. As a result, there are also high levels of untreated diseases (YCDC and Save Many poor urban households have also been caught the Children, 2016). Children in slums suffer from in debt traps, with high-interest loans quickly constant shortage of decent food and sanitary living and easily becoming unaffordable. In some cases, conditions, which has a negative long-term impact on borrowers have had to borrow from other sources to health and life expectancy. finance earlier loans or have even resorted to moving to different neighborhoods to avoid repayment. Although the majority of informal settlers send their Conflicts or violence resulting from failure to repay children to school, the number of children enrolled loans have also been reported in informal settlements drops drastically after the age of 13. Among poor (DIIS, 2017). households in Yangon, approximately half are at school at age 13; 14 percent at age 16; and only 2 percent at age 17. Many leave school at the age of 13 SLUM DWELLERS FACE MANY orl4to seek employment in the informal sector(YCDC CHALLENGES and Save the Children, 2016). Common informal work for girls includes employment in garment factories, As discussed in Chapter 3, there are a large number or as housemaids, while boys tend to work as street vendrs r csua labrer. Mny iri alo lave of informal settlements in Myanmar. This population is also expected to grow given increased urbani6ation school to care for younger family members, allowing and the lack of affordable housing options. Beyond parents to go to work. Without an income, these the issues of precarious living conditions and limited girls are often considered a financial burden of their fml. access to basic services, there are a number of challenges for slum dwellers that particularly affect their inclusion in the city. These include issues around Financial inclusion is a challenge among the urbany poor who have limited income to make ends meet legal documentation, tenure security, and crime. and thus must seek loans in the informal sector. High Attitudes to slum dwellers and legal documentation. levels of indebtedness and high-interest loans are Informal settlements, a common phenomenon in widespread among poor residents in informal urban the rapidly urbani6ing developing world, have been settlements. Improving one's financial situation was rated by slum dwellers the top priority for solutions genrally -tolerat by municipa ah itis Myanmar (UN-Habitat, 2017). However, evictions (UN-Habitat and Cities Alliance, 2017). Among the of urban squatters since the late 1950s have also surveyed poor households in Yangon, 86 percent built negative perceptions among urban dwellers. had taken loans at an interest rate of 20 percent Instead of being viewed as legitimate residents who or above. Except for money lenders, many residents also frequently borrowed from family members and reur.upr,o h reakolde smkn contributions to economic growth, informal settlers acquaintances, as well as visited local grocery shops are sometimes viewed as threats to safety and urban and pawnshops for quick cash (International Growth development, or even perceived as "professionals" who Centre, 2016). gain wealth by receiving compensation for illegally- occupied land (DIIS, 2017). 62 A significant number of urban residents do not have Not having security of tenure obstructs poor residents' legal identity documents. According to the 2014 access to legal documents and municipal services, Census, 22.4 percent of residents in Yangon Region do prevents them from investing in the houses and not have any type of identify documents (Myanmar improving their own living conditions, brings fear of Ministry of Immigration and Population Report, eviction, creates high level of turnoverand uncertainty, 2015). In particular, residents in informal settlements hinders social cohesion, and breeds ground for crimes have difficulties in obtaining such documents, which and tensions. Unsurprisingly, demand for tenure in turn hinders their access to formal employment, security is thus high among informal settlers. Over municipal services and low-interest loans. For 90 percent residents in informal settlements do not example, a National Registration Certificate (NRC) is want to move. According to the 2014 Census, only often required to be employed in larger factories. To 68 percent of urban residents in Yangon have secure obtain one, proof of a permanent address has to be tenure, the lowest among all the states and regions shown, which is often not possible for those renting (Ministry of Labour, Immigration and Population, spaces in illegal settlements. Difficulty in obtaining 2017). legal status has worsened the cycle of poverty among informal settlers (DIIS, 2017). There is a spectrum of tenure insecurity in Myanmar - some are under constant threat of eviction, and Some informal settlers have to find alternative some face no immediate threat but might have to ways to obtain legal documents in order to secure move after a number of years (Forbes, 2016). Some employment or send their children to school. This informal settlements, though lacking formal land may include, for example, paying additional fees to titling ortenure, are not underthreat of eviction asthe officials or other influential local figures in order to settlers rent parcels of subdivided private land owned obtain documents, for which some may be forced to by powerful landlords. Meanwhile, many are under take a loan. Others may try to borrow an NRC from constant fear of eviction and have to move from one friends and family members or seek help from other place to another (YCDC and Save the Children, 2016). well-connected individuals to find work at factories. Yet, even such informal channels are not within each The resettlement model has been the predominant of the poorest urban dwellers, compared to those approach in redeveloping informal settlements in financially better off and socially better connected Myanmar for decades. Massive resettlement projects (D IIS, 2017). were implemented in the 1950s, 60s, 80, and 90s to relocate inner-city settlers to fringes of cities, Tenure security and evictions. Tenure security is a and redevelop land in the central city with higher- highly complex issue given the different ownership value properties. Slum clearance has continued to and the myriad of laws governing land and properties take place in recent years. In absence of adequate in Myanmar. The Mapping Yangon project found replacement housing, many evicted slum dwellers have that nearly all residents in informal settlements ended up squatting in other informal settlements as had little tenure security of any type. Nevertheless, the only affordable option with access to economic many households in underserved resettlement opportunities (DIIS, 2017). Repeatedly moving or being areas, who were relocated from the inner city in the forced to move from one illegal settlement to another last century, were issued lease certificates or other also perpetuates the cycle of urban poverty and tenure documents by the government. The land of inequality. some peni-urban, densely populated settlements, though included within the administrative boundary of Yangon city as the city expands, are still classified CRIME AND VIOLENCE FURTHER as village tracts subject to laws governing rural land. AFFECTS VULNERABLE GROUPS Tenure systems and security also vary within each settlement. For example, some resettlement sites Informal settlements, especially large ones such as warranted originally relocated households lease of Hlaing Thayar township, are infamous for high level landplos. ut ltertheplot wee sbdivdedand of crimes. Due to the high mobility of residents, it is resold to other occupants, leaving the ownership believed by the public and local authorities that such mixed and complex (UN-Habitat and Cities Alliance, informal settlements have encouraged criminals 2017). and gangsters to behave and escape freely. Informal 63 settlements are commonly seen as the breeding they feel more vulnerable and fear revenge from the ground of crime, social tension, gangs, and all kinds criminals (DIIS, 2017). of illegal activities, with higher-density settlements seen as being attractive for criminals to cluster and While data are not urban specific, gender-based hide from authorities (DIIS, 2017). The Global Peace violence (GBV) is a persistent problem in Myanmar. Index Survey places Myanmar at number 130 on a Women and girls experience various forms of violence, list of 162 countries ranked for women's safety, and such as physical, sexual, verbal, or psychological 17th out of 19 Asia Pacific countries, ahead of only the abuse, in their private and public lives. While statistical Philippines and North Korea (2018). data on the scale and nature of GBV remains limited, a number of studies have shown that GBV is prevalent Many informal settlers themselves are victims of in the country. Studies on Intimate Partner violence crimes. As police are not seen as playing a proactive (IPV) and rape suggest this is quite prevalent. Over role in upholding law and order, residents tend not half of women respondents in a survey by the Gender to report crime to them or to other ward authorities, Equality Network (GEN) reported experiencing particularly when they have newly arrived in a intimate partner sexual violence and marital rape. settlement. Women, particularly single women and Nationwide rape statistics for 2012 were the highest widows, are reported as being afraid to walk the in five years, making rape the second-most commonly streets of informal settlements alone at night. They reported serious crime after murder.29 are also less likely than men to report crimes, as 4.3 PEOPLE WITH DISABILITIES An estimated 2.3 million people, or some 4.6 percent certificates cannot obtain citi6enship scrutiny cards of Myanmar's population, is reported to live with (CSCs), which, as outlined above, makes it difficult to some sort of disability30. About 10 percent of these access a range of services, including higher education, are children. Ayeyarwady Region and Chin State as well as to own land and vote (Newall, 2015). reported the highest prevalence of disability at 7.6 and 7.4 percent of the state populations respectively. Existing studies show that children living with one or The prevalence of disability in Rakhine State was more disability have much lower rates of enrollment also high, at 5.3 percent.31 The disabled are excluded in education than those without. Even if enrolled, in various ways --many cannot access education, discrimination in school can cause children living employment and health services (Ministry of Labour, with disabilities to drop out. A 2015 study found that Immigration and Population, 2017). Illiteracy levels childrenwith disabilities were"pushed" out of school by among the disabled are more than 10 times as high as discrimination from school administrations, teachers for those without disabilities. and peers, as well as accessibility issues, such as difficulties with transport, access to bathrooms, and Children with disabilities may lack birth registration long school commutes. The study found that they documents, which constrains their access to were not "pulled" out of school: even though parents services. UNICEF found that 27 percent of children complained of poverty, children with disabilities were with disabilities in their 2016 study did not have a not leaving school to work to support their families birth certificate. In certain states and regions in (Eden Center for Disabled Children, 2015). Though the study-Tanintharyi, Rayin and Rakhine-only Yangon may have slightly more opportunities than around 50 percent of children with disabilities had other cities with two government-run schools, five their births registered, the first step to obtaining a private schools, and five NGO institutions, these are birth certificate (UNICEF, 2016). Those without birth still very limited (Bawi, 2012). 29 The Asia Foundation, 2017, Myanmar Urban Crime and Violence, and Gender Equality Network (GEN), Behind the Si-lence: Violence Against Women and their Resilience Myanmar (Yangon: GEN, 2015), 32, http://www. genmyanmar.org/publications/Behind%20the%20 SilenceFullReportEnglish.pdf 30 The definitions of disability used in the census were in line with international standards and UN recommendations, and consist of having self-reported difficulties with seeing, hearing, walking, and remembering or concentrating. These are four of the six developed by the Washington Group on Disability Statistics 31 Because up to 1.09 million were not enumerated in Rakhine state, the percentage of the population living there with disability could be much higher 64 � � � ; � � л ' ;� rA.a. , ., S а � ' � , :� :� � У � � � � � � t чt � t � . ,� � • , . �., . у , � ` . �,л�`� � �, у ' �.;� �у , ,r,, ' lq �, �ц . � � � � , .r i,� . �- � � i' т� �� �+г..- а , � � n Г"� � �i' � � � �„� � , .;� � �, � � � � � ,�: w. � ` � � , - � -�� � �r � --� j � ;� � �. �� �� '�-� ' � � � � , � � '� , t . � ��, . .�-�, �� ч ' � ` � ..,�. ��, _�: r =_ � � ; - ; -- � � � �.�Г � �. 1 i R » л � 't rs.. � � е 3! �.' � k � / � � � ✓ � � 4 �� � { •�`*.. ` а �,,. � � � � ь � f ,�` , �• I ��А �. !. � ? ч• ,, г ;`�,: . . �. �■! ~_��` .! ,. . . �' �ii. � `� � �р �.,.. т ~ � �, 4.4 GOVERNANCE, COMMUNITY NETWORKS, AND PARTICIPATION The broad issues of governance are discussed below with community "elders" who sometimes serve as in Chapter 5, though it is important to recogni6e neighborhood advisors. Community networks are that the less regulated informal settlements have usually stronger among the ethnic minority groups stimulated informal local governance systems that than the Bamar majority. However, high resident play a role in social inclusion. Local leaders, older turnover and the sense of insecurity due to lack of residents from resettlements in the last century, as tenure and fear of eviction have undermined social well as monasteries and churches provide support to cohesion and obstructed formulation of community newcomers, often in terms of services and amenities self-help organi6ations, which could otherwise be such as real estate, money lending, and sales of water more active in encouraging communities to organi6e and electricity. Community networks are generally and address issues such as poor provision of basic strong among kin, friends, and neighborhoods services (DIIS, 2017). in informal settlements as a survival strategy, 4A FROM J# 1k *41L "01 룔狐 幽 KEY MESSAGES " Strong institutions, good governance and sufficient financing at the local level are necessary for implementing inclusive urbani5ation policies. " Decentrali5ation in Myanmar is still at an early stage and local implementation is substantially hampered by financial constraints, and technical capacity. " Sub-national financing is inadequate for local governments to f ulf iH their service delivery responsibilities in cities and requires much reform. POLICY RECOMMENDATIONS " Strengthen coordination between government agencies for decision making and urban management by streamlining processes and investing in capacity building for implementation. " Strengthen participatory planning for urban development by engaging communities and citi5ens (including low income). " Develop a comprehensive and equitable approach to financing for urban development by improving regional disparities via intergovernmental fiscal transfer mechanisms, strengthening local revenue generation, scaling up private sector financing and using land value capture for larger cities to raise revenue. 5.1 GOVERNANCE AND INSTITUTION 5.1.1 INTRODUCTION 5.1.2 LEGAL AND POLICY FRAMEWORK Building inclusive and sustainable cities requires strong institutions and good governance at all levels Historically, Myanmar's political and administrative of government, but especially at the local level. In structure has been highly centrali6ed. The 2008 Myanmar, decentrali6ation and deconcentration Constitution included a number of provisions aimed at reform efforts are still young, having been initiated increasing the degree of political (transfer of decision- in the 2008 Constitution. While urban service making power and accountability), administrative delivery functions have been devolved to subnational (distribution of managerial responsibilities) and governments, in practice, local governance is often fiscal (expenditure responsibilities and corresponding hampered due to limited implementation of policies/ financial resources) decentrali6ation (Asia Foundation, frameworks, financial resources, and technical 2013). The Constitution legally established state and capacities. Lack of transparency and fair decision region governments, providing them the right to enact making as well as insufficient resources to successfully laws, prepare budgets, collect taxes, and manage implement programs and policies on the ground may entities under their control. lead to unequitable urban development and intra-city disparities, which may further lead to social tensions, Chapter Two32 of the Constitution, which is divided crime and violence. Engaging communities and among eight sectors (finance and planning; citi6ens in decision-making processes is important economic; agriculture and livestock breeding; in strengthening policies, enhancing service delivery, energy, electricity, mining, and forestry; industrial; and ensuring social stability in cities. Empowering transport, communication, and construction; social; urban dwellers to actively engage and contribute in and management), lists areas over which the state/ their cities is a powerful way of promoting inclusion region governments have legislative powers (Asia (Baker & Gadgil, 2017). This chapter explores the Foundation, 2015). While the 2008 Constitution and current condition and challenges of governance and subsequent reforms delegated functions to the state/ institutions in Myanmar in the context of inclusive region governments and established new mechanisms urbani6ation. of local governance, Myanmar still remains a relatively centrali6ed state (Asia Foundation, 2015b). DEVELOPMENT AFFAIRS ORGANIZATIONS Currently, Myanmar is administratively divided into seven states, seven regions, and one Union /F Territory (the capital city of Nay Pyi Taw) which are / /further divided into 74 districts; 330 townships and approximately 400 Development Affairs Organi6ations (DAOs); 13,618 village tracts and 3,063 wards; and approximately 70,000 villages (Dickenson-Jones, Dunn, Joelene, De, S Betty, 2016) (Figure 5.1). 32 Schedule One indicates the Union responsibilities while Schedule Two indicates the Region or State Legislative List 69 Figure 5.1: Administrative Structure of Myanmar Union Union Territory (1) Regions (7) States (7) Districts Self-administered Self-administered Zones (5) Diviin\ 1 Districts Nay Pyila Townhp Village-tracts Towns Villages Words Source: Ministry of Land, Infrastructure, Transport and Tourism, Japan (MLIT), 2013 Prior to the 2008 Constitution, urban matters were regions (Figure 5.2). Each of the 14 state/region managed by the Department of Development Affairs parliaments (hluttaw) enacted their Development under the Union Ministry of Border Affairs (MoBA)33. Affairs (Municipal) Laws and the township-level The 2008 Constitution transferred these function DACs would focus on urban governance under to the 14 states/regions, establishing township-level the supervision of the state/region Minister of DAOs under the full control of the new 14 states/ Development Affairs (Asia Foundation, 2015b). Figure 5.2: State/Region Government and DAOs State/Region Government State/Region DAO Office Township DAO Township DAO Township DAO TDAC Township TDAC Township TDAC Township DAD Office DAO Office DAO Office Source: Asia Foundation, 2015b 33 Under the 1989 Municipal Law, Municipal Committees served the administrative roles and functions for urban areas while District Councils served similar roles for rural areas. The 1993 Development Committees Law established that Development Committees report to the Ministry of Home Affairs' General Administration Department, however were places under Ministry of Border Affairs in 1994 70 The DAOs are a nascent exception to Myanmar's level DAO office supervises the township-level offices, relatively centrali6ed administrative structure. All including coordination and staff management for townships in Myanmar (except Yangon, Mandalay the whole state/region (lbid). DAO is the only fully and Nay Pyi Taw) have township-level DAO offices, decentrali6ed government agency under the control which serve as municipal offices under the full control of state/region governments (all other subnational of the respective state/region government where they entities are under the Union Ministry) and are unique are located. The DAOs are comprised of a Township in ways summari6ed in Table 5.1. The legal mandate of Development Affairs Committee (TDAC), which is DAOs clearly define its core duties and responsibilities, generally composed of seven members, of which four which focus on the provision of social (basic) services are indirectly-elected community representatives) and local economic governance in urban areas, as and a Township DAO Office, which is composed of defined in Table 5.2. professional DAO civil servants. The state/region- Table 5.1: Comparison of DAO and other Subnational Entities DAO Other Subnational Entities Fully decentrali3ed government agency under the control of Part of the Union Ministry, primarily state/region governments reporting to Nay Pyu Taw. Fully self-funded and must use their revenue within the Receives its union budget from the Union township where it was collected. Have significant discretion Government Fund. over the use of their revenue collected. Serve as major social service providers for roads and bridges, Tends to focus on one sector. urban water supply, waste management, drainage, etc. Paramount in local economic governance, issuing local business licenses and permits, collecting taxes and fees, and managing local auctions for toll roads and ferries. Source: Asia Foundation, 2015b Table 5.2: DAO's Duties and Functions DAO Social Service Duties and Function DAO Economic Governance Duties and Function - Township planning - Markets owned by DAO - Water supply - Privately-owned markets - Sanitation - Cattle markets - Sewerage disposal - Slaughterhouses - Disaster preparedness - Roadside stalls - Street lighting - Small loan businesses - Roads and bridges - Bakeries and restaurants - Vagrant persons on the streets - Dangerous trades - Animal control - Lodging houses - Parks, swimming pools, public baths, and - Breeding of animals and disposal of carcasses recreation centers - Ferries - Road rules, street naming and addresses - Slow-moving vehicles - Cemeteries and crematoriums - Removal of cemeteries - Public buildings under the DAO - Demolition of squatter buildings - Other development works with public interest - Other duties as needed All duties and functions are entirely supported by revenues raised locally by DAOs Source: Ibid 71 CITY DEVELOPMENT COMMITTEES and redevelopment projects incorporating planning for water supply and sanitation, ii) New town and The three principle cities of Nay Pyi Taw, Yangon satellite town developments, iii) Various types of (which includes 33 townships and four districts in housing development including affordable housing, the Yangon Region), and Mandalay are subject to public and rental housing, sites and services and specific governance and management arrangements slum and squatter upgrading schemes, iv) Industrial under City Development Committees (CDCs) which 6one development, v) State owned and urban land, differ from the states/regions and DAOs. The CDCs especially in Yangon, and vi) Joint venture investment are responsible for urban planning and development, 6ones (Ibid). urban land administration, municipal public works and service delivery (roads and bridges, water supply, Today, DUHD's roles and responsibilities shifted to waste management, parks and sports grounds, a more "Enabler, Facilitator, and Regulator" role and street lighting, funeral services, fire-fighting, etc.), responsibilities include: public health, and tax collection (including business licensing and registration). Yangon City Development i) Development of the National Spatial Committee (YCDC) and Mandalay City Development Development Plan (NSDP) incorporating Urban Committee (MCDC) are not fully autonomous local Development Policy, National Housing Policy, governments and have delegated administrative an integrated urban network system (National functions of the Yangon Region Government (YRG) Urban System Plan), and a comprehensive land and Mandalay Region Government (MRG). Both use plan, consistent with the emerging National cities are managed by CDCs that are partly elected Comprehensive Development Plan (NCDP). by the public where the chairmen are Ministers ii) Assisting of the state/region governments and of Development Affairs of the respective region CDCs as required, with activities such as urban governments. In contrast, as the capital of Myanmar, planning/human settlement planning including the Union Territory of Nay Pyi Taw is managed concept plans, structure plans and local plans/ separately by a ten-member Council, of which nine detailed guidance for major cities, as well as members are selected by the president and one is providing advice and assessing development appointed by the military (Ibid). permit applications. iii) Improving access to basic social services in urban and rural areas such as shelter, education, MINISTRY OF CONSTRUCTION health, potable water, and creating a livable environment while ensuring protecting of the natural environment Within the Ministry of Construction (MoC), the two main departments associated with urban planning iv) Establishing and modifying planning laws and and development are Department of Urban Housing regulations, pertaining to urban planning and and Development (DUHD, and the Department of development Public Works (DPW). DUHD takes the lead in urban v) Assisting the Union Government to establish a development policy-making, spatial planning, land national spatial planning system in collaboration administration, and housing and urban infrastructure with relevant line ministries (Ibid). development. DPW is responsible for planning and implementation of infrastructure including roads, bridges, airfields and buildings (JICA, 2014). 5.1.3 ADMINISTRATIVE CAPACITY In line with the decentrali6ation efforts which DEVELOPMENT AFFAIRS mandate that local spatial planning responsibilities ORGANIZATIONS should be undertaken at the subnational level, DUHD to shift its functions from "doing" to "enabling", As discussed above, while the 2008 Constitution focusing more on policy making, planning, regulating involved significant provisions aimed at and monitoring urban and regional development and decentrali6ation, Myanmar remains a highly construction. Historically, DUHD acted as a "provider" centrali6ed state. The division of administrative of urban-related services such as the planning, responsibilities and accountability relationships management, and implementation of physical and defined in Chapter Three created a somewhat blurry social infrastructure, including i) Urban development 72 distinction betweenthe state/region departments and holistic approach to improving revenue collection and the state/region-level offices of the Union ministries. management is a high priority. In terms of budgeting, In terms of urban matters, the Constitution provided integrated strategic planning and budgeting is not DAOs the responsibility and discretionary power to available. Furthermore, multi-year budgeting is not perform its social service provision and economic allowed, complicating efforts to implement large- development duties and functions. However, the scale projects (such as water and sewage systems) removal of the Department of Development Affairs which require budgeting to be spread over several under MoBA meant that DOAs were left without a fiscal years. Finally, the above-mentioned challenges "mother" ministry which would serve as a central limit the DAO's accessibility to external financing guiding agency to streamline development. As a sources, such as international development partners result, the 14 state/regions each have unique DAO (further detailed below in Section 5.2). systems with its own legal mandate, policies, staffing, and training programs, which present various Urban Planning and Implementation. Currently there capacity (versus mandate) challenges in revenue is a lack of integrated planning and budgeting with collection, budgeting and financing; planning and little cross-sectoral planning between government implementation; and human resources (Ibid). agencies. As there is no parent ministry for DAOs, urban planning and implementation processes Revenue Collection, Budgeting, and Financing (such as policy development, financial systems, Capacity. While DAOs are uniquely self-funded with procurement, O&M) are not streamlined, and high discretion over the use of its revenues, DAOs the state/region governments must take-on an are mandated with responsibilities of social service increasingly important role in this area. Urban master provision and local economic governance. Therefore, planning only exists in Yangon and Mandalay, despite effective revenue collection and management, the emerging urbani6ation needs in secondary cities. budgeting and finance are essential to local service Outside Yangon and Mandalay, development projects delivery and is one of the largest operational are generally conducted based on immediate needs challenge of DAOs. In terms of revenue collection, with less than one-year budgets. While DAOs have larger towns may be able to raise enough revenues a mandate for urban planning, however do not have to cover the cost base, however many medium and dedicated staff or department for urban planning smaller towns struggle to raise revenue. While many (further detailed in the Urban Planning Chapter). state/regions allow for a limited transfer of funds, a A7A /00, 5.2 FINANCING Sound financing mechanisms are critical for inclusive 5.2.1 FISCAL RESOURCES and sustainable urban management and service delivery. Insufficient resources to successfully Current revenues of SNGs can generally be categori6ed implement programs and policies on the ground lead into Union transfers and own-source revenues (Table to unequitable and unsustainable urban development. 5.3). SNGs outside of Yangon and Mandalay are Weak capacities for policy-making, planning, heavily reliant on Union transfers, which constitute implementation, and enforcement, often are rooted in approximately 90 percent of their revenue source. the lack of sufficient human, technical, and financial In Yangon and Myanmar, approximately 50 percent resources. As elaborated in Section 5.1, the 2008 of revenues come from Union transfers while the Constitution laid out the decentrali6ation of fiscal, remaining come from current own-source revenues as well as political and administrative, roles and (taxes and non-taxes) as well as capital and financial responsibilities. Since then, sub-national governments revenues (including revenues from sale of capital (SNGs), including state/regions and townships/ assets) (Figure 5.3). districts, have played an increasingly prominent role in the management and spending of public finance and Union General Purpose Grant Transfers. The general- service delivery. However, the financial mechanisms purpose grant is the largest fiscal transfer to the in place, including the inter-governmental fiscal states/regions, accounting for 87 percent of all transfers and generation of own-source revenues, transfers in 2017-2018. The general-purpose grant are insufficient to finance required infrastructure and uses a formula with six equally weighted indicators: services at the local level. This chapter explores the i) state/region population, ii) state/region poverty current condition and challenges of financing urban index, iii) state/region per capita GDP, iv) state/ development in Myanmar. Furthermore, the chapter region land area, v) state/region urban population, lays out potential new sources of revenue to be and vi) state/region per capita tax collection. Three explored. indicators are used as proxies for expenditure needs Table 5.3: SNG Current Revenue Breakdown Own-Source Revenues Union Transfers Non-Tax Tax Union General Constituency Other Ad-Hoc Union Tax Fees, Wheel tax, property Purpose Grant Development Transfers Revenue Sharing: penalties, tax, excise tax, Transfer Fund (CDF) - Commercial Tax monopoly mineral tax, land Transfers - Income Tax licenses, etc. tax, water and - Special Goods Tax embankment tax, - Stamp Duty Tax forest products extraction tax, fisheries tax Source: Renaissance Institute, 2018 74 Figure 5.3: Breakdown of SNG Fiscal Resources 5A - Share of total By type, 2016-17 BE resources 5B - Across 14 states/regions, million Kyat 100% - 600,000 90% Financial revenue 80% 500,000 Capital revenue 70% 400,000 Other non-tax current revenue Own current 60% Ow*urn 50% 300,000 SNG Tax revenue 40%CD 30% 200,000 CDF 20% 0i i- Tax-sharing revenue Transfers from Union 10% 00 . General grant transfer AII YGN &Other - S a ) MDL SNGs 0) 2 l (1) 3 a3 0 a aU S- a C Source: lbid while the other three are used as proxies for fiscal a result of large state-owned enterprises (SOEs) constraints (i.e. ability to generate own revenues). operating across the country but filing taxes at the The rules-based mechanism (including the macro Yangon LTOs. Since then, equitable policy changes indicator linked formula for the transfer pool) were have been implemented and 15 percent of commercial introduced to the grant transfer mechanism in 2015- and special goods taxes from SOEs at Yangon LTOs 2016 as part of the Medium-Term Fiscal Framework are distributed across states/regions in accordance (MTFF) reform to ensure a more transparent and to the general-purpose grant transfer formula, equitable hori6ontal allocation of funds. However, the bringing down Yangon's share of the tax-sharing pool distributional impact remains small and there is much to 56 percent in 2017-2018 FY (Ibid). room to improve the disparities across states/regions (Rennaisance Institute, 2018). Own-Source Revenues (Tax and Non-Tax). Within the powers stipulated under Schedule 5 of the 2008 Constituency Development Fund (CDF). CDF transfers Constitution, state/region governments collect are the smallest fiscal transfers to the states/regions, both tax and non-tax revenues. Schedule 5 formally accounting 1.7 percent of all transfers. Through the assigns several items as local taxes on SNG budgets CDF, each of the 330 townships receive 100 million (see Table 5.3 for tax and non-tax items). However, tax Ryats, which are used for small-scale infrastructure autonomy - the power of SNGs to exercise discretion or for supplementing the Union expenditure on over tax policy, including tax base and rate - remains education and health (Ibid). to be explored. Several state/regions, including Yangon, have passed their own tax laws to alter tax UnionTax Revenue Sharing. Union tax revenue sharing bases and rates for property, land, fisheries and wheel accounts for 9% of fiscal transfers to states/regions. taxes, suggesting that SNGs are indeed keen and Currently, there are four taxes that are shared to SNGs able to set their own rates. Tax revenues and non-tax - commercial taxes, special goods taxes, stamp duty revenues accountfora significant share of own-source taxes, and individual income tax. The four taxes are revenues, at 16 percent and 53 percent respectively. collected by the Internal Revenue Department (IRD) However, the majority is collected by Yangon and under the Union Ministry of Planning and Finance Mandalay (65 percent of tax revenue and 80 percent (MoPF). Originally, the tax sharing mechanism of non-tax revenue) and SNG tax performance outside allowed the taxes to be shares by origin of accrual (i.e. of the two cities remain weak (Ibid). collection), however the mechanism created a bias to state/regions with greater commercial activity and better-developed tax administrations, such as Large Tax Payer Offices (LTOs). In 2016-2017 FY, 87 percent of the tax-sharing pool was allocated to Yangon as 75 5.2.2 PROPERTY TAX Myanmar currently has a functioning property tax to property. Property tax in Myanmar is a regular system, however plays a small role compared to other compulsory payment made by the owners/occupiers of SNG revenue sources (Figure 5.4). the property to the urban municipalities (CDCs or DAOs) for the benefit of receiving public services. Property tax Taxes and Charges Related to Property. Taxes and in Myanmar is distinct from other property-related charges on property include property tax (urban), taxes and charges, in that they are paid to the CDCs/ land tax (rural), capital gains tax on sale of property, DAOs rather than the Union government (Table 5.4) stamp duty on sale of property and user fees related (McDonald & Hein, 2017). Figure 5.4: DAO Revenues 2016/17 for Selected Cities Hpa-An DAO Revenue 2016/17 Taunggyi DAO Revenue 2016/17 Per cent of total revenue budgeted, revised allocation Per cent of total revenue budgeted, revised estimate Transfers from Property Tax 4.9% Transfers from Property Tax Union and State Other Tax 0.1% Union and State 2.7% Other Tax 0.5% Govt. 6.1% Business Got .%Business LicensesLicenses 16.6% Other revenue (permits) 6.0% (fees, charges rents, etc.) 12.6% Slaughterhouse Monopoly License Other revenue Auction 21.1% Other Monopoly (fees, charges Monopoly License Auctions rents, etc.) License Auctions 49.1% 51.7% 28.3% Source: McDonald Hein, 2017 Table 5.4: Taxes and Charges on Property in Myanmar Type Timing of Payment Payment To Property Tax (Urban) Regularly Municipalities (CDCs or DAOs) Land Tax (Rural) Regularly Union (collected by GAD) Capital Gains Tax One time at sale of property Union (collected by IRD) Stamp Duty One time at sale of property Union (collected by IRD) User Fees When services are used Service Provider Source: Ibid 76 Legal Foundations for Property Tax. The legal Property tax in urban areas managed under DAOs foundations for urban property tax in Myanmar are (as opposed to CDCs) have a similar combination prescribed in the Development Affairs Laws of the mechanism, except that the building and land tax is states/regions. For Yangon, property tax is defined payable by the owner and service-specific user fees as a combination of general tax, lighting tax, water are payable by the occupants, in general. Property tax and cleansing tax which is payable by the owners valuations are calculated based on ARVs. Policy and/or occupiers (Figure 5.5). The tax is based on an decisions including tax rates and assessed property assessment of the annual rental value (ARV) of the valuations are the responsibility of the Minister of property which is provided by the YCDC Assessors Development Affairs or the DAC (Ibid). Department. In case there is a change in assessed property values or other tax policy changes, the YCDC Tax Administration. Property tax administration Assessors Department must seek approval from the in Myanmar is still quite weak with substantial YRG. The YRG Development Affairs Committee (DAC) room for improvement. Current conditions for tax may grant exemptions and discounts for religious and administration including: i) tax base identification, ii) public buildings as well as properties in areas affected property valuation, iii) cadastral record keeping, iv) tax by poverty (Ibid). rates and billing, v) tax collection, and vi) enforcement for selected cities are summari6ed in Table 5.5. Figure 5.5: Composition of Property Tax and Tax Rates Applied for Selected Cities Per cent of annual rental value Max Hpa-An Bago Pathein Taunggyi* YCDC** YCDCMax allowable allowable Building & Land Building & Land Building & Land Building & Land Building & Land 20% 10% 10% 7% 4% 8% 10% Street Lighting Street Lighting Street Lighting Street Lighting Street Lighting 5% 4% 4% 6% 4% 5% 10%W 12% 10% Garbage Garbage Garbage 15% 10% 10% 7% 40% 30% 30% 20% 8% 13% 52% Source: Ibid 77 Table 5.5: Current Conditions of Property Tax Administration for Selected Cities Component YCDC Other Cities (DAOs) Tax Base - Approximately 300,000 properties - Properties on cadastral record: Hpa-An (8,494), on the cadastral record Taunggyi (33,764), Pathein (18,748), and Bago - Owner/occupier to pay property tax (26,415) to YDCD Assessors Department - Payable by owners of all buildings (residential, - Exemptions for religious and public government and commercial) regardless of rental buildings, full or partial relieve for status poverty - Exemptions for religious, government, and military buildings Valuation - ARV and monthly rental values (MRV) - Varying valuation techniques: ARV calculated based Technique determined by YCDC Assessors solely on the buildings' physical characteristics, Department AVR calculated based on building's physical - Nine types of property classification characteristics and local adjustments, and AVR - Last valuation review: 2014/2015 calculated as land area multiplied by value per foot - Last valuation review: Hpa-An (2008), Taunggyi (2014/15), Pathein (2012/13), and Bago 92012/13) Record - Digital cadastral record for 283,569 - Hpa-An: Digital cadastral records for 8,057 Reeping residential properties for tax billing properties with remaining kept on paper ledger; purposes, included taxpayer number digital records include information on ownership, address, valuation, and tax payable building materials, and number of floors; updated amount. Property classification by tax collectors based on phone-based app on paper ledgers maintained by - Taunggyi: Digital cadastral records for 23,516 assessors properties with remaining kept on paper ledger; - Paper-based case files for non- digital records include information on ownership, residential buildings land si3e, building materials, number of floors and - Valuation information entered into road type; updated by tax collectors based on cadaster manually. Only buildings phone-based app built after 2015 have accurate - Pathein and Bago: Paper-based cadastral record; physical information includes information on ownership, building materials and number of floors; updated by tax collectors Tax Rate - 5-13% based on property type - Hpa-An: 30% (includes: building, lighting, water and and Billing (includes: general and lighting taxes) garbage) - Taunggyi: 8% (included building and lighting) - Pathein: 20% (included housing, lighting and garbage) - Bago: 30% (included building, lighting, water and garbage) Collection - Private properties: collected every - Collected every six months (door to door spot six months by tax collectors (door to collections) door spot collections) - Factories/workshops: collected once a year - Hotels/accommodations: collected every three months - Payments can be made directly to designated bank accounts Enforcement - Revenue Recover act (1980) entitles - Revenue Recover act (1980) entitles municipalities municipalities to take legal action in to take legal action in the event of non-payment the event of non-payment - However, enforcement is weak and resource - The YCDC Law (2013) stipulates that provisions are rarely used YCDC can sieves the property until property tax arrears are settled - However, enforcement is weak and resource provisions are rarely used Source: Ibid 78 5.2.3 REVENUE COLLECTION AND 5.2.5 PRIVATE SECTOR MANAGEMENT Both international and domestic private resource A majority of revenue collection (approximately 77 flows have increased significantly in Myanmar since percent) is conducted by municipal offices such as 2011. In terms of international private resource flows, the CDCs and DAOs. A majority of YCDC and MCDC's foreign direct investment (FDIs) grew more than six- revenue collection comes from non-tax sources such fold between 2012/13 FY and 2015/16 FY. While the as sale of capital asses, sale of monopoly auction share is small compared to FDIs, domestic private licenses and other fees. Revenue collection by SNG investments have also increased incrementally, bodies constitute approximately 17 percent (Figure 5.4) especially in the sectors of real estate, transport, and (Rennaisance Institute, 2018). manufacturing. This growing appetite presents an opportunity for cities to leverage the private sector in financing inclusive and sustainable urban development 5.2.4 SUBNATIONAL GOVERNMENT (Government of China; ASEAN; UNDP, 2017). BORROWING The role of private sector in development assistance is being explored in the forthcoming Development The 2016 Public Debt Management Law stipulates Assistance Strategy which is being developed by the that states/regions can borrow from both Myanmar Development Assistance Coordination Unit (DACU). and international lenders with the approval from the Private sector financing may include public-private Union Cabinet and the Union Hluttaw (state/region partnerships (PPPs), guarantees, equity and blended parliament). However, to date, SNGs outside of Yangon finance, i.e. use of public funds to leverage private and Mandalay have not undertaken significant external investments (Ibid). borrowing (Ibid). Figure 5.6: SNG Own-Source Revenue Collection million Ryat by administrative units 600,000 Others 500,000 400,000 Sub-national government bodies 300,000 Ministry of Home Affairs 200,000 100,000 U Municipal - DAOs/CDCs 0 2016-17 Source: Renaissance Institute, 2018 79 Public Private Partnerships (PPPs). Myanmar has Innovative Infrastructure Financing Mechanisms implemented various forms of PPPs in several sectors, (including Land Value Capture). Once the legal, including telecommunications, electricity, natural regulatory and enforcement frameworks are in resources, housing, civil aviation, roads and public place, cities in Myanmar may explore innovative transport. Despite the absence of national/sector infrastructure financing mechanisms such as Land policy frameworks or institutional management Value Capture (LVC). LVC schemes and techniques functions dedicated to PPPs, rapid progress is being (Table 5.6) tap into urban land values to support urban made in appointing private sector counterparts for infrastructure finance. Yangon and possibly Mandalay PPPs. The Ministry of Electric Power (MOEP) and the may have the conditions to introduce LVC, including electric powersectorhas been a particulararea of focus strong economic growth, rising real incomes, and for PPP application (ADB, 2014). Furthermore, a large increased motori6ation and congestion, which are all share of the highway networks in Myanmar operates factors that may contribute to land value appreciation under Build-Operate-Transfer (BOT) arrangements around improved urban infrastructure. However, (Rennaisance Institute, 2018). adoption of LVC schemes and techniques would require the city to have a complete and formally adopted detailed city base map, land use 6oning including floor area ratio (FAR) demarcations, building regulations and permit procedures as a prerequisite (World Bank, 2018a). Table 5.6: Various Land Value Capture Schemes LVC Scheme Description Betterment Levies Captures part of the land value gain attributable to the infrastructure investment by imposing a one-time tax or charge on the land-value gain Developer Land Sales Requires subdivision developers to provide their own internal infrastructure and to recover their costs through land sales. As the scale of new development increases, this policy shifts an ever-larger share of total infrastructure investment to private developers Value Capture via Involves the sale of land whose value has been enhanced by infrastructure Project-Related Land investments or 3oning changes. If the public sector owns the land, it can internali6e Sales the benefit of public investment and capture the gains through land sales Development Developer receives development rights in exchange for obligation to compensate Charges in cash (or provide in-kind) the cost of certain items of public infrastructure benefitting larger area. Sale of Development Zoning tool which allows public authorities to sell development rights (such Rights as additional densities or permits to developed beyond the 3oned FAR) as an alternative to the sale of land to capture incremental value generated by public infrastructure projects. The proceeds from the sale of development rights are then used to finance infrastructure improvements. Transfer of Zoning tool which enables the surplus (or unused) floor volume of buildings (such as Development Rights heritage buildings which may not be making full use of the 3oned FAR) to be sold or (TDR): traded for cash to other developers who may want to build buildings with higher FAR in other parts of the city. Special Assessment An institutional and financing mechanism which enables organi3ation of a distinct Districts area within a city, such as a specified set of blocks in a CBD, for the purpose of aiding in the development or improvement of public assets that provide a direct and special benefit such as streets, sidewalks, curbs and gutters, water, sewer, gas electric, lighting, drainage or flood control facilities. 80 LVC Scherne Description Developer Exactions Approaches land financing from the cost side, unlike value capture. They are one- and Impact Fees time, up-front charges designed to recover the infrastructure costs associated with growth. Developer exaction requires developers to install at their own expense the internal infrastructure needed to meet development standards or to pay for infrastructure elements provided by public authorities. Impact fees are designed to cover the external infrastructure costs caused by new development Land Asset Allows public authorities to exchange land assets for infrastructure assets, in cases Management where the balance sheets of many public entities are top heavy with urban land and property assets but the cities where the property is located suffer acute shortages in infrastructure. Public authorities may sell or lease publicly owned land and use the proceeds to finance infrastructure investment. Rather than using land-financing instruments to finance individual investment projects, public entities undertake a balance sheet adjustment, in which they modify the overall composition of publicly held assets (increase public infrastructure assets and reduce land assets) Source: World Bank, 2017e; World Bank, 2018 5.2.6 EXPENDITURES Capital Expenditure. While the breakdown of SNG budget expenditure varies across states/regions, in State/region expenditure has nearly tripled since general, capital expenditure constitutes a large ratio 2012/2013, when their first budgets were enacted. of SNG budgets, with all states/regions allocating at Recent trends in state/region expenditure and Union least 40% of budget on capital investments (Figure expenditure are shown Figure 5.6. While impacts of 5.7). In all states/regions (excluding Yangon), the share decentrali6ation is evident, Myanmar's state/region of budgeted capital expenditure has grown (36 percent share of general government expenditure remains at 12 increase in 2013-2014 and 55 percent in 2016-2017), percent, which is lower than its neighboring countries suggesting an increasing prioriti6ation in infrastructure such as Vietnam (45 percent), Indonesia (35 percent) development (Ibid). and the Philippines (25 percent) (Ibid). Figure 5.7: Expenditure Across Levels of Government 2012-2018 in million Kyat U State/Region expenditure U Union expenditure 30,000,000 State/Region expenditure as % of 3,000,000 25,000,000 general government spending 11.8% 2,500,000 20,000,000 2,000,000 6.4% 15,000,000 1,500,000 10,000,000 1,000,000 5,000,000 500,000 2012-13 2013-14 2014-15 2015-16 2016-17 2017-18 2012-13 2013-14 2014-15 2015-16 2016-17 2017-18 Source: Renaissance Institute, 2018 81 Figure 5.8: Breakdown of SNG Expenditure (by Expenditure Category) By economic categories, 2016-17 RE 100% 80% 60% 40% 20% 0%I g Capital Salary Maintenance Other Note: RE = Revised Estimate (revised figures during fiscal year) Source: Renaissance Institute, 2018 Looking at the breakdown of SNG budget expenditure Economic Enterprises (SEEs) made up a significant by executing agency, the largest share is budgeted share of SNG budgets (primarily road investments to the Ministry of Construction (MoC) (Figure 5.8). under the MOC Public Works). Currently, the only Subsequently, the largest capital expenditure is also si6able SEE on the SNG budget is the Electricity Supply budgeted to MoC. A significant portion of MoC budget Enterprise under the MOEP (Ibid). Incidence analysis is allocated to rural roads under the Department of to understand the extent to which expenditures reach Highways (DOH). Furthermore, a share of municipal the poor is beyond the scope of this study but would be budget is also allocated for roads. Until 2015, State insightful for policy. Figure 5.9: Breakdown of SNG Expenditure (by Executing Agency) By administrative units, % of total across 9 state/region budgets in 2017-18 BE 100% 90% 80% 70% 60% 50% 40% 30% 20% 10% Other Ministry of Electrical Power and Energy Sub-national government bodies Ministry of Home Affairs Municipal (DAOs and CDCs) U Ministry of Construction Note: Other includes: 1) Ministry of Agriculture, Livestock and Irrigation; 2) Ministry of Health and Sports; 3) Ministry of Natural Resources and Environmental Conservation; 4) Ministry of Planning and Finance, and few other small departments; Sub-national government bodies includes: SNG Cabinet Office, SNG Parliament, Court, Attorney General Office and Auditor Office; Municipal units include Development Affairs Organi6ations (DAOs) and Mandalay City Development Committee (MCDC); BE = Budget Estimate (enacted by legislature) Source: Renaissance Institute, 2018 82 rl, Current Expenditure. Current expenditure across Medium-Term Fiscal Framework (MTFF) Reforms. SNGs has decreased in the recent years. For all SNG The MTFF reform aimed to foster fiscal discipline and current expenditure in 2017-2018 FY, approximately 40 improve strategic resource allocation to government percent was budgeted for "maintenance' 29 percent agencies. The MTFF reforms introduces rules to fiscal for "salary payments:' and 15 percent for "purchase of transfers, such as the revision of the allocation formula goods and services (Ibid).' for the Union General Purpose Grant (see Chapter 5.2.2 Fiscal Resources). 5.2.7 PUBLIC FINANCIAL Changes to the Budget Calendar. An important recent MANAGEMENT development in Myanmar is the shift in its Budget calendar, which has changed from April-March to October-September. The rational for the change is The 2008itutonstasocitut estlhed tc F c t commonly cited as the difficulties in implementing SNG institutions associated with Public Financial inrsrcuepoet.amee yteosto h Manaemet (FM)suc as he lutawsand infrastructure projects hampered by the onset of the Mangedeprtment s PFM) su hae then H sand rainy season (during June - October). In contrast to budgt dpartent. Tere avebee sigifiant the Budget calendar, the Tax calendar is expected to efforts to improving fiduciary capacity, including i) remain the sam caing tw epate budget execution rates, ii) cash management, and iii) rmi h ae(pi-ac) aigtosprt budgt eecuionrats, i) csh anaemet, nd ii) fiscal calendars for Budget and Tax is not uncommon fiscal transparency and public access to key fiscal alcund rsdfowevergequ iso co e on infomaton suc asthepublcaton f Cti6n's around the world, however, requires some consideration information (such as the publication of Citi6en's intrsocahm ag et(bd) budgets). However, there are still uncertainties around accounting practices, flow of funds, integrated planning and budgeting, data availability, etc. that require further assessment. Examples of Good Practice from other regions may be explored (Box 5.1) 83 Box 5.1: Public Financial Management for Local Governments in the Philippines In the Philippines, a PFM Assessment Tool was - Accounting, Recording and Reporting: first introduced by Department of Budget and Contains indicators that measure whether Management (DBM) in 2012 as part of its effort to or not adequate records and information institutionali6e governance reforms by enabling are produced, maintained, and disseminated local government units (LGU) to assess and for purposes of decision-making, control, improve their PFM systems, as well as generate management, and reporting on operations. information that would serve as a basis for their - Internal and External Audit: Contains PFM Improvement Plans (PFMIPs). The PFM indicators that examine the arrangements Assessment covers seven critical dimensions of for scrutiny of public finances and follow-up performance of a well-functioning PFM system, by the local chief executives. namely: - Citi5ens' Participation: Contains indicators that measure the extent by which the LGU - Policy-based Budgeting: Contains indicators encourages concerned citi6ens (organi6ed as that measure if the budget is prepared with Civil Society Organi5ations) become partners due regard to government policy. of the LGU in the formulation, monitoring, - Comprehensiveness and Transparency: evaluation, and improvement of the local Contains indicators that measure if budget budget. information provides a complete picture of revenue forecasts, prior, current and budget For Myanmar, introduction of a PFM tool/ years' expenditures, and the expected assessment similar to that of the Philippines outputs. They also measure whether fiscal will shed light to the strengths and weaknesses and budget information is accessible to the of current local PFM systems - including fiscal public. resources and revenue collection, budgeting - Credibility of the Budget: Contains indicators and expenditure execution, accounting and that measure whether or not the budget is reporting, etc. The PFM tool/assessment will realistic and is implemented as intended. identify the bottlenecks in the current procedures - Predictability and Control in Budget and subsequent concrete action plans for Execution: Contains indicators that measure improvement. if the budget is implemented in an orderly and predictable manner and whether or not there are arrangements for the exercise of control and supervision in the use of public funds. Source: World Bank, 2017f 84 ■■ㅏ｀녈‘--! CREAㄲ NG I NCLUSIVE 이ㄲES 1N MYANMAR KEY MESSAGES " Cities are engines of growth and prosperity, and are essential for lifting people out of poverty through increased employment opportunities. " The way that cities grow, however, matters in terms of creating the foundations for livability, prosperity and competitiveness. " Prioriti5ing an inclusive cities approach will help to ensure that cities grow in an equitable way which will have significant benefits for peace and stability. POLICY RECOMMENDATIONS " To promote inclusive urbani5ation, priority recommendations are presented in the areas of economic, spatial and social inclusion, as well as the need for promoting good governance and financing for urban development. These focus on investments in: o sustainable urban infrastructure and urban upgrading; o building resilience to mitigate the impact of shocks on people's livelihoods and health; and o policy changes to facilitate access to legal documentation for migrants and specific subgroups, and targeted social programs for those that are particularly vulnerable to exclusion. o Capacity building and new financing for urban development " Implementation will be reliant on a strong commitment from government to a bold reform agenda. " Reform will also require identifying champions and key stakeholders, finding relevant entry points for private sector investment, and ensuring a stable governance framework aligned with sufficient technical capacity and financing for implementation. 6.1 INTRODUCTION Urbani6ation brings many opportunities for growth are particularly vulnerable to exclusion and may not and poverty reduction. Given Myanmar's relatively be able to benefit from urban opportunities. early stages of urbani6ation, the opportunities are ever more important -- the investments made today Taking these recommendations forward will require will shape cities for decades to come. Prioriti6ing additional work to: deepen the analysis on the details an inclusive cities approach will help to ensure that of where and how they can have the biggest impact, cities grow in an equitable way which will have identify champions and key stakeholders, find significant benefits for livability, prosperity and relevant entry points for private sector investment, competitiveness. An inclusive urbani6ation approach and ensure a stable governance framework aligned is consistent with the Sustainable Development with sufficient technical capacity and financing for Goals (SDGs), particularly SDG number 11 which is implementation. These are challenges that the World to "make cities and human settlements inclusive, Bank and other development partners can support in safe, resilient and sustainable: and the New Urban partnership with the Government of Myanmar. Agenda which calls for the provision of basic services for all citi6ens, and refers to the 'Right to the City' as its guiding visionary principle. This means "equal use and enjoyment of cities and human settlements, seeking to promote inclusivity and [ensuring] that all inhabitants, of present and future generations, without discrimination of any kind, are able to inhabit and produce just, safe, healthy, accessible, affordable, resilient and sustainable cities and human settlements to foster prosperity and quality of life for all. (United Nations, 2017)". Theframeworkofeconomic, spatial andsocial inclusion used in this report points to several priority policy recommendations outlined below and summari6ed in Table 6.1 along with the key lead agencies for implementation. Other World Bank reports include recommendations for reforms in the macro economy, labor markets, and social sectors. These reforms are fundamentalto sustainable development in Myanmar. This report has prioriti6ed recommendations that are core to inclusive urbani6ation and can have the greatest impact. Also discussed are examples of good practice approaches adopted in World Bank operations and other international contexts. Many of the recommendations come back to the need for investments in sustainable urban infrastructure and urban upgrading to provide basic services for all and ensure mobility for the flow of people, goods and services, building resilience to mitigate the impact of shocks on the economy on people's livelihoods and health, facilitating access to legal documentation for migrants and specific subgroups, ensuring gender equity, and targeting social programs for those that 87 Indicative Time Frame: Table 6.1: Priority Policy Short term (S): 1-2 years Recommendations for Inclusive Medium term (M): 2-3 years Urbani5ation in Myanmar Longer term (L) 3-5 years CHALLENGE OUTCOME PRIORITY ACTIONS LEAD AGENCIES High informality Improve In-situ community based urban Development limits opportunities for upgrading (M) Affairs opportunities and informal workers begin identification of high risk Organi3ations links to exclusion areas, needs and upgrading plan (S) (DAOs)/ City * secure financing (S-M) Development * implementation (M-L) Committees (CDCs) Access to micro finance for small Ministry of entrepreneurs (M-L) Construction; * develop enabling environment and Ministry of incentives to foster micro finance Education; (M-L) Planning and * ensure gender equality in access Finance (M) Transport investments to enable mobility to jobs and markets (L) * Education and training for skills in urban jobs (L) * prioriti3e vulnerable groups (S-M) * investments in access and quality improvements (L) Some areas in Build resilience to In-situ community based urban DAOs/ CDCs cities highly natural haards upgrading in high risk areas (S-M) Ministry of vulnerable to identify and prioriti5e investments Construction flooding and other (S) Ministry of natural haards begin implementation (M) Social Welfare, Relief and Drainage/solid waste management Resettlement (M - L) * identify and prioriti5e highest risk areas (S) * implementation (M) Early warning systems (S) * design and implement approach to reach the most vulnerable (S) 88 Indicative Time Frame: Short term (S): 1-2 years Medium term (M): 2-3 years Longer term (L) 3-5 years CHALLENGE OUTCOME PRIORITY ACTIONS LEAD AGENCIES Prornotiny spatia inousion to improve access to affordable land, housiny and services for ow ncorne, and vulnerable populations Substantial Invest in equitable Infrastructure investments needed DAOs/ CDCs infrastructure access to in water, sanitation, roads, drainage, Ministry of deficits limiting sustainable urban solid waste management (M-L) Construction; successful infrastructure identify and prioriti3e needs with Ministry urbani3ation targeting of areas for greatest of Natural and contributing impact (S-M) Resources and to poor living ensure participatory design that is Environmental conditions gender, disabled-informed (S) Conservation begin implementation (M-L) (MOREC) Shortage of Improve and In-situ upgrading of existing stock and DAOs/ CDCs affordable expand affordable slum areas (M-L) Ministry of housing, large and housing diagnostic needs assessment and Construction; growing number development of affordable housing Construction of informal plan (S) and Housing settlements ensure target is for low income Development populations (S) Bank (CHDB); * create enabling environment for Ministry of housing supply and demand (M) Planning and * develop approach to incentivi5e Finance private sector for low income market (S-M) * implementation (L) Implement the National Land Use Policy (S-M) * enable and train staff for implementation (S-M) Limited urban Improve Align plans across agencies (land use, DAOs/ CDCs planning results integrated spatial transport, environment, disaster risk) Ministry of in congestion, planning for (S) Construction sprawl, ha5ard inclusive and set up coordination mechanism (S) Ministry of risk, inequality, resilient urban invest in geospatial data and sharing Social Welfare, and can affect development platforms (e.g. plan for national Relief and city growth spatial data infrastructure) (S) Resettlement opportunities Ensure planning is gender and disability -informed Capacity building (M-L) * identify needs and develop longer term strategy (M) * implementation (L) 89 Indicative Time Frame: Short term (S): 1-2 years Medium term (M): 2-3 years Longer term (L) 3-5 years CHALLENGE OUTCOME PRIORITY ACTIONS LEAD AGENCIES Prornotin socia incusion to rnprove conditions for vulnerable yroups to full participate in society Some are not able Target social Targeted programs designed to: link DAOs/ CDCs to fully participate programs to migrants with job opportunities, and Ministry in job markets or marginali3ed provide assistance for disabled (M) of Labor, access services groups identify and prioriti3e needs (S) Immigration and (migrants, ethnic program design, implementation (M) Population; groups, disabled, Ministry of women) Addressing gender and other Social Welfare, discrimination (S-M) Relief and * awareness raising, education (S) Resettlement * policy reform (M) Lack of Facilitate Reform of identification card system DAOs/ CDCs documentation access to legal to ensure equity and remove obstacles Ministry and identification documentation linked to migration status (M) of Labor, can prevent identify equitable approach and Immigration and citi5ens from design system (S) Population; accessing jobs, implementation (M) Home Affairs services. Ensuring good governance and finance for urban development is fundamental to creating inclusive, competitive and sustainable cities Fragmented Strengthen Streamline processes for urban * DAOs/ CDCs governance coordination management, delivery (S) * Relevant hampers decision between * carry out diagnostic assessment sectoral making and government of processes and develop Ministries improvements on agencies for recommendations for efficiency for the ground. decision making core urban services (S) and urban * implement changes in a phased management manner (S-M) Hori5ontal and vertical coordination needed (S-L) * carry out institutional mapping and assessment for core agencies and recommend reforms (S) * implement changes in a phased manner (M-L) Invest in capacity building for implementation (M-L) 90 Indicative Time Frame: Short term (S): 1-2 years Medium term (M): 2-3 years Longer term (L) 3-5 years CHALLENGE OUTCOME PRIORITY ACTIONS LEAD AGENCIES Ensurng good governance and fnance for urban developrnent is fundarnentai to creating ineusive, competitive and sustainabie cities Urban plans and Strengthen Engage communities and citi3ens to DAOs/ CDCs programs can be participatory help to promote inclusion (S) Ministry of disconnected from planning for urban mainstream participation in urban Construction citi3en's needs. development planning and program design (S) * train relevant staff (S) * ensure low income communities are included (S) Strengthen Develop a holis- Utili5e intergovernmental fiscal Ministry of participatory tic and equitable transfer mechanisms to equalie Planning and planning for urban approach to fi- regional disparities (M) Finance; development nancing for urban diagnostic work to identify approach Ministry of development for reform (S) Commerce * implementation (M) Strengthen local revenue generation (M - L) * diagnostic work to develop proposals for increasing property tax revenues (S) Allow more local discretion over funds use (S) * Develop transparent decision making and implementation process (S) Scale up private sector financing through improvements in enabling environment (M-L) * Address existing bottlenecks through reform (M-L) * Invest in capacity building (S-M) Explore use of Land Value Capture for larger cities (S-M) * Carry out diagnostic work to identify key opportunities (S) * Implementation (M) 91 6.2 PROMOTING ECONOMIC INCLUSION From a broad policy perspective, there are many entrepreneurs (see example in Box 6.2). opportunities for promoting economic inclusion through better access to and quality of education Firms mention the lack of skills as one of the key for all, and addressing issues in the macro economy constraints to growth. The existing technical and labor market to create increased opportunities vocational and education training (TVET) system for employment and income generation. Myanmar is under-utili6ed and is poorly oriented to the skills has lower educational attainment than comparator employers need (World Bank, 2018b). The system is countries (about 5.7 years) and low education quality. highly fragmented, with training services offered by It is reported that 20 percent of third graders cannot the public and private sector, by numerous ministries, understand what they read. More than 80 percent of and at national and local levels. There are no quality employers say that the education system does not standards that are applied across institutions and no prepare people for work (World Bank, 2017b). These accreditation system to measure quality. There is challenges will require significant investments from a little attention by the training institutions on the skills national perspective. demanded by the labor market or to job placement of graduates. These factors help explain why technical At the urban level using an economic inclusion lens, and vocational education has limited success in two key priorities stand out: addressing the high building human capital leading to higher quality jobs levels of informality; and improving resilience to (ADB 2016, Milio et al. 2014). natural ha6ards and economic shocks. As discussed in Chapter 2, those working in the informal sector Improvements in the TVET system could help to cannot count on regular incomes for their families bridge the gap between the need for skilled labor and nor do they have social protections to fall back on those that don't have the skills to enter the formal in times of need. When disasters or shocks hit, the labor market. Government could support institutions urban poor tend to be most vulnerable given where through demand-driven mechanisms, such as they live and their limited safety nets, and lack of vouchers to students or to employers can expand savings to fall back on. One event can wipe out one's access. Such vouchers would need to be linked to the home and livelihoods and create much instability in demands in the labor market and could be targeted to the economy. Strengthening approaches to address those most in need. informality and build resilience are essential to building economic inclusion. Fostering opportunities for those in the informal sector. A full discussion on issues in the labor market that may contribute to high levels of informality is beyond the scope of this report. Myanmar still has major work in addressing bottlenecks to improving the environment for the private sector which will attract more and diversified foreign investments to sustain job creation (World Bank, 2018b). For those groups that are more prominent in the informal sector such as the urban poor, migrants, and women, opportunities to enhance their income earning opportunities and access to the formal sector include: urban upgrading to provide better infrastructure services that will enable more home based work; better transportation to enable mobility to jobs and markets; education and training programs that are linked to the skills needs in urban based industries; and micro financing for small 92 Box 6.1: Moving beyond Informality - Policy Priorities for Skills Development and Examples of Success Several countries in the East Asia region are gaps. The Third Elementary Education Project heralded as successes in terms of producing in the Philippines, for example, is aimed at skills required for economic growth. In the 1960s improving standards in school by giving school and 70s, governments in the Republic of Korea, management more autonomy, providing more Singapore and Taiwan, China overcame challenges training for teachers, increasing distribution of common in low- and middle-income countries to school supplies and deploying other measures of pursue strategic plans to create both demand for, improving quality of education. Such measures and supply of, high-skilled labor. This fueled the were found not only to raise test scores, but growthoftechnology-intensivesectors,thatlater also improved girls' educational attainment and became drivers of strong economic growth. It is positively impacted their eventual labor market important to note, however, that these initiatives earnings. built on earlier efforts to ensure inclusive access to the basics of human capital investment, The World Bank's 2014 report East Asia Pacific including good nutrition, and strong healthcare at Work: Employment, Enterprise and Well- and education. Without such a foundation, Being acknowledges that skills gaps can arise the attempts to build higher-order skills for a and persist for a host of reasons, and that each significant part of the working population would country faces a unique set of challenges that not have succeeded. requires different policy actions in response. The table below sets out a framework for broad Other countries in the region have learned from priority actions required. this experience in attempting to close their skills Figure 6.1: Framework for Broad Priority Actions for Building Capacity disseminate ifarmation Align incentives Increase capacity Labor markets Creat and manage appropriate * Enforce apprenticeship * Facilitate recruiting links labor market information contracts between firms and between schools/training systems workers centers and firms Credit markets Collect earnings data in labor Provide guarantees or other Expand public student loan market information systems incentives to private banks programs Decision making Collect data on school and Subsidi5e opportunity and Provide counseling and training provider performance other costs of education and support services to youth at and disseminate to students training to make staying in risk of dropping out and families school easier Coordination Facilitate information flows Subsidi5e worker training and Facilitate firm opportunities between firms and schools/ firm upgrading/technology to support schools/training training centers on current adoption in specific sectors centers with instructors, and expected demand materials, or facilities Government Collect and utili6e data to Hold providers accountable Improve institutional evaluate school and training for performance through arrangements to provide provider performance funding mechanisms or other sufficient autonomy at all incentives levels * Make providers accountable * Deliver needed support to to students through voucher teachers and administrators systems at school level 93 Other programs, such as initiatives in Renya and There is much scope for introducing such training the West Bank and Ga6a have used innovations to programs in Myanmar which would help to prepare link jobs between employers and low skilled labor. those in need with the skills necessary for the job Renya's Duma Works (www.dumaworks.com), a market. The use of social networking technologies mobile social network and allows informal workers could help to link informal workers with job to connect to jobs through friends of friends. opportunities. To maximi6e impact on inclusive Souktel (www.souktel.org) uses SMS to reach a urbani6ation, such programs could be targeted to wider clientele than just internet users. Informal ensure inclusion of the urban poor, new migrants, employers can post vacancies in a simple manner women, and on ethnic and religious minorities. that does not require extensive registration processes. Source: World Bank, 2014, and Cunningham, W. and Muno6, R. eds., Myanmar Future Jobs: Embracing Modernity, Main Report and Background Reports, World Bank, 2018 Building Resilience. Given Myanmar's exposure to For the urban poor and other marginali6ed groups risk, building resilience, particularly for marginali6ed who are typically at highest risk, key priorities groups who are often hit the hardest by disasters include urban upgrading, programs that invest in or shocks will be important to economic inclusion. early warning systems can help plan for shocks and Building resilience can be achieved by ensuring mitigate impacts on the population. In Indonesia, for infrastructure investments are resilient, by creating example, the Jakarta Flood Early Warning System insurance and catastrophic risk pools, and through has been used to build capacities to manage risk. strengthening disaster planning and early warning The capacity building took place at the community systems in urban areas. The Myanmar Southeast level, with training for representatives in urban Asia Disaster Risk Management Project aims to neighborhoods most vulnerable to flooding, and build resilience through improving drainage services participatory approaches ensured all urban residents and the structural performance of selected public were included regardless of income and community facilities in Yangon, and enhancing the capacity of status (UNISDR, 2010). the Government to facilitate disaster response. The project strengthens financial planning for disaster resilience, helps to reduce flood risk by improving and increasing the capacity of drainage infrastructure in Yangon and introducing an integrated approach to flood risk management, it reduces disaster risk in Yangon by (a) retrofitting priority public facilities to ensure a targeted level of performance during a design-level earthquake, and (b) supporting risk assessments for lifeline infrastructure (World Bank, 2017d). 94 6.3 PROMOTING SPATIAL INCLUSION Investing in affordable, safe, and reliable housing, critically important investments in basic services such infrastructure, and transportation services, as sanitation, solid waste collection and a reliable particularly in underserved areas, can reduce spatial water supply can have substantial benefits to health, inequality, open up new employment opportunities, productivity and welfare. Providing access to affordable and reduce health and disaster risk. The current needs and reliable transportation also ensures better access in Myanmar are significant, prioriti6ing investments to employment opportunities, as well as to services and in sustainable infrastructure and affordable housing, amenities such as schools and hospitals. Together, these as well as building capacity to carry out integrated basic infrastructure investments can help to reduce planning are top priorities for fostering spatial spatial disparities within cities. inclusion in cities. Infrastructure needs can vary widely across any Investing in Equitable Access to Sustainable given city, with some areas historically underserved Infrastructure and Affordable Housing. Chapter 3 compared to others. The downtown region of Yangon, describes the basic infrastructure-related challenges for instance, benefits from a colonial era drainage that Yangon and Myanmar - the country's two largest system, even if its capacity has not kept up with more cities - currently face. From water supply to sanitation, recent growth. In contrast, informal settlements lack solid waste management and affordable housing, access to almost all basic services. To identify priority the cities are both faced with difficulties in ensuring a infrastructure needs, urban upgrading programs reliable and accessible supply of basic services. Ensuring can adopt participatory approaches to both identify equitable access to sustainable infrastructure is a key and implement infrastructure upgrading at the facet of pro-poor, inclusive development. Sustainability, neighborhood level. Such participatory approaches in the case of Myanmar, particularly includes resilience often have better outcomes in terms of sustainability of given the country's high exposure to natural ha6ards, but interventions, given the involvement of the community given the lock-in effects of infrastructure, approaches across all stages of infrastructure identification, design for compact low carbon urban development are also and maintenance. Box 6.2: Vietnam Urban Upgrading Project The Vietnam Urban Upgrading Project (VUUP) than 200 low-income areas across these cities was implemented over a ten-year period from were identified for inclusion in the project, with 2004 to 2014, with the aim of alleviating poverty communities actively involved in the process by improving the living and environmental of assessing what types of infrastructure conditions of the urban poor in selected cities. interventions would be most beneficial for them. The project specifically adopted participatory More than 2.5 million urban poor have benefited planningmethods,withtheintentionofdeveloping from the project, with improvements made to outcomes that were inclusive and pro-poor. roads, water supply, drainage, sanitation services and electricity provision. Previously, emergency Many cities in Vietnam have low-income areas response vehicles such as ambulances and fire with uneven access to basic services. Frequent trucks could not access homes as local roads flooding and poor sanitation, for example, are were narrow and often flooded. This is no longer common challenges; subsequently, the urban a concern with improvements made under the poor population also faces serious health and project; in addition, children are able to play safely environmental risks. VUUP set out to address in the streets around their homes. The project also these challenges in the cities of Hai Phong, upgraded clinics, community centers, schools and Nam Dinh, Ho Chi Minh City and Can Tho. More kindergartens in low-income neighborhoods. 95 Figure 6.2: Before and After Images of Urban Upgrading in Vietnam Before (L) and After (R) pictures of the An Rim Hai Canal in Hai Phong. Prior to VUUP, the canal was polluted and largely abandoned by city residents, eventually becoming a prime spot for crime and drug abuse. Under VUUP, the canal was dredged and surrounding roads were upgraded, creating a new amenity for the community and leading to revitaliation of the area. (Source: World Bank, 2015) Aside from investing in infrastructure, the disabilities - is more affordable than retrofitting project also provided access to micro loans for at a later stage, the project plans to engage with households whose incomes are in the bottom 40 communities to design infrastructure that is percent. These households were able to use the more inclusive for all. loans to make improvements to their homes, and to engage in income-generating activities. In Myanmar, such an approach could be considered for the upgrading of existing uban The success of VUUP has led to the design and settlements, given the challenges currently faced implementation of other similar projects in in ensuring adequate access to basic services in Vietnamese cities. Building on the VUUP model, fast-growing cities like Yangon. The involvement the Scaling-Up Urban Upgrading Program (SUUP), of the local community in the selection of priority approved in 2017, incorporates principles of infrastructure, as well as in the downstream universal design in project-funded infrastructure. maintenance and up-keep of facilities, would Recogni5ing that upfront incorporation of such contribute to overall sustainability and ensure a principles - catering, for example, to a growing more inclusive approach. elderly population as well as to those with Sources: World Bank, 2015; World Bank, 2017g As the population in cities rise, the needs for affordable million new housing units by 2030, or slum upgrading housing will also increase. The deficit is substantial, programs are important to promoting spatial and the city has significant slum populations. Such inclusion. A number of examples such as the Vietnam conditions can create divisions in society and do not Urban Upgrading (Box 6.2) or the Indonesia Approach allow for equitable urban growth. Programs such as to Affordable Housing and Slum Upgrading (Box 6.3) urban upgrading and the supply of affordable housing are highly relevant for Myanmar and are needed with are needed. Several existing initiatives, such as urgency. the "Million Homes Plan" which aims to develop one 96 Box 6.3: Addressing Affordable Housing in Indonesia Indonesia faces substantial demand for The National Slum Upgrading Project aims to affordable housing, with one million new units improve urban infrastructure and services in needed annually. Around 20 percent of the 64.1 slums across Indonesia. The project finances million housing units are in poor condition, with connective infrastructure identified through much of it informal and self-built. Approximately Slum Improvement Action Plans which are five- 22 percent of Indonesia's urban population, year plans to be prepared by local governments or around 29 million people, live in slums with with technical assistance and support, as well substandard housing and inadequate access as tertiary infrastructure identified at the to basic services. Among the challenges are community level. This includes small scale water constraints that prevent the private sector from supply, drainage, sanitation, footpaths, fire participating in low cost housing development, safety, site improvements (public spaces and as well as bottlenecks with land availability, sidewalks) and modest support for strengthening including complex land acquisition processes. community-based livelihoods through the construction of livelihood enabling facilities and The Government of Indonesia has a broad set of services. The project will support improvements policies and institutions to support affordable to housing of the poorest where deemed necessary housing, but these have not been effective in within the context of slum upgrading. meeting demand. To address these challenges, the Gol launched the One Million Homes program, Thoughthe projects arestill underrelatively stages a subsidi6ed mortgage scheme in mid-2015, the of implementation, the combined approach is National Affordable Housing Program, and the anticipated to help Indonesia meet its significant National Slum Upgrading Project which are all demand for affordable housing. In Myanmar, given currently under implementation (both projects that an estimated 10-15% of the population are in supported by the World Bank). informal settlements, and that there is growing pressure to address the lack of affordable housing The National Affordable Housing Program Project in larger cities, a similar multi-pronged approach aims to innovate the affordable housing market by is already being considered by organi3ations such addressing bottlenecks and actively engaging the as the semi-government Construction, Housing private sector in delivering for unserved segments. & Infrastructure Development Bank (CHID Bank). The approach has three components; i) targeting International examples such as the Indonesia lower middle income households that are unable programs could provide useful learning points to access commercial mortgage finance for home as Myanmar looks towards addressing both purchase without public assistance; ii) targeting demand- and supply-side issues relating to the the bottom 40 percent of Indonesian households provision of affordable housing. that require home improvement rather than home purchase solutions and for whom the market for commercial mortgage finance is unaffordable even with deep assistance enhancements; and iii) support to policy reform and capacity building activities. 97 Box 6.4: Japan's Legal System for Low-Income Housing and Public Housing Measures in Airin District, Japan. Japan's Public Housing Act, enacted in 1951, market and gentrification to some extent. While stipulates the national government to provide housing measures can be carried out by the city financial and technical assistance to local or the prefecture, the City of Osaka has taken governments for the construction of affordable leadership for affordable housing under the NSDV housing to low-income residents. During the high- initiative. The City of Osaka has considered economic-growth era between 1950s and 1970s, measures for the housing poor, centered around the government committed to develop public the reconstruction of municipal housing. housing in the urban areas to accommodate the housing shortage. Today, however, given the At the national scale, construction of new public fiscal difficulties and declining population, there housing is limited due to the high costs associated. is a tendency to refrain from building public Alternative measures, such as the conversion housing resulting in an insufficient supply. As a of vacant houses, are being promoted to supply result, despite the needs for public housing, it is public housing at a low cost. While such alternative extremely difficult for low-income citi6ens to live measures are currently not conspicuous in the Airin in public housing (in 2010, the ratio of successful District, if national government housing measures applicants to the total number of applicants for (suchasthe HousingSafety NetActenactedin2017) public housing was about 1 in 30 in Tokyo and become easily accessible for housing developers, it about 1 in 18 in City of Osaka). Such defective is highly likely that the low-income housing market housing measures have caused people to become and environment will change significantly in the "housing poor." Airin District. The Nishinari Special District Vision (NSDV) For Myanmar, the lessons learned from Airin aims to revitali6e the district and protect the suggest that the provision of affordable housing livelihoods of its long-time residents. In the is a complex issue of supply, livelihoods, short term, the initiative places importance accessibility, and financing. Increasing supply on improving the livelihoods of low-income of new construction alone does not meet residents. The main measure considered for market demand and must be simultaneously achieving this goal is improving the supply of explored with livelihoods (i.e. access to basic affordable and high-quality public housing. infrastructure), accessibility (i.e. public transport Reinforcement of affordable housing measures options), and financing (rental or ownership/ will limit excessive development by the capital mortgage options). Source: Shirahase, 2018 Improving integrated urban planning which is challenges commonly associated with a quickened coordinated with capital investment plans. The pace of urbani6ation, such as sprawl, congestion and physical layout of a city is one of several factors that the proliferation of informal settlements. can impact access to jobs and services. Residents of a low-income area with no direct access to transport Building capacity for integrated urban planning is routes, for instance, have considerably fewer important for Myanmar, particularly considering opportunities for employment and income-generation. its complex subnational governance structures Adopting an integrated planning approach is one key and the current practice of urban planning being way to ensure that there is more equitable access carried out at different levels of government, often to infrastructure and amenities. By ensuring that without coordination. Given the relatively low pace infrastructure and land use planning are integrated, of urbani6ation compared to other countries in the cities can better ensure that services keep pace with region, the timing is also opportune to institute the rate of urban development. Robust urban planning clear roles and responsibilities in the urban planning can also pre-emptively guard against some of the process, and to work with development partners 98 to build technical capacity. The finali6ation of the The Singapore experience is one that demonstrates National Urban Development Strategy presents an how it has been carried out, and the strong role of entry point for further engagement in this regard. participation in the planning process. (Box 6.5) Box 6.5: Urban Planning in Singapore Singapore's success as a highly livable urban and allowable density. The Master Plan is also environment has been attributed in part to the complemented by detailed control plans, which city-state's practice of integrated, long-term are developed to shape the spatial structure of strategic planning. Urban planning in Singapore the city around specific concerns - the provision begins with a forward-looking Concept Plan, a of parks and waterbodies, for instance, and the multi-agency government effort that maps out identification of conserved heritage buildings Singapore's urban development over a 40 to and conservation 5ones. The reali3ation of 50 year timeframe. Based on projected future planning intentions established in the Concept economic growth and population figures, the Plan and Master Plan is further enabled through Concept Plan provides a broad-based land use several downstream processes, including the plan to meet the country's long-term land needs, Government Land Sales program, whereby establishing the amount and location of land the State releases land parcels for sale in a under key land use groups, including residential, carefully-timed manner, responding to market industrial, commercial, parks and transport demand and also facilitating the development of infrastructure. strategic growth areas. All developments are also subject to the Urban Redevelopment Authority's The Concept Plan is translated into a statutory Development Control guidelines, which establish Master Plan, which reflects the details of technical requirements such as building height designated land use, land parcel configuration and setbacks. Figure 6.3: Singapore's Urban Planning Framework Legal backing, CONCEPT PLAN Spatial structure with broad land Long-term strong urban 40-50 year time hori6on allocation, factoring in long-term integrated governance, and (Reviewed every 10 years) population needs, economic growth planning institutional projections, and so forth capacity _ _ _ _ MASTER PLAN Detailed and granular land use, . intensity, and accompanying layers 10-15ewe y ver ime ern such as urban design, conservation (Reviewed every five years) ] guidelines, and so forth In-built flexibility in land-use 6oning PLANNING INCENTIVES codes and planning incentives allows (Fiex bility) some variation to planning and design parameters LAND SUPPLY TO Land supply planned in tandem with MARRET market demand and cycles (Reviewed half-yearly) Development P Developers and landowners can seek control and PLANNING changes to planning parameters implementation .. w DEVIATIONSJthrough various avenues based on Market capacity (Market responsiveness) merits of proposed development responsiveness Source: Shirahase, 2018 99 Figure 6.4: Singapore's Land Use and Master Plans Left: Land Use Plan 2011, showing broad land use categories; Right: Master Plan 2014, showing detailed land uses and densities for individual parcels Source: Urban Redevelopment Authority, Singapore Long-term planning has allowed Singapore to In Myanmar, challenges exist both in terms balance competing land use needs in a land-scarce of drawing up robust plans as well as in environment, while also ensuring a high degree of implementing them, particularly given the lack sustainability and livability. The effectiveness of of technical capacity and lack of clarity over its Master Plan rests in its clear links to the vision roles and responsibilities across the various and long-term strategies for growth of the city, as levels of government. International best practice well as the country's strong enabling environment examples, such as that of Singapore, can for implementation, i.e. legislative and regulatory provide guidance in terms of how a systematic systems that support the reali6ation of the land and integrated urban planning process could use plan. Public engagement in the development of eventually be institutionali3ed. To be effective, both Concept and Master Plans is also becoming such systems not only rely on an integrated increasingly established as a key part of the plan approach to develop plans, but also facilitate formulation process. implementation and enforcement with a strong legal and governance framework. Source: World Bank, 2016; and World Bank, 2017 Building capacity for data-informed urban planning, and sharing of geospatial data among government Effective urban planning must also be adequately agencies, civil society, academia and businesses. Such informed by data and analytics in order to develop a a system would allow data-informed urban planning firmunderstandingofacity'scurrentandfutureneeds. to be carried out, and the ongoing One Map initiative This is, for example, being done in Indonesia under signals the government's commitment to this vision. the World Bank's City Planning Labs initiative (Box However, current regulations and practices often 6.6). Similarly, Myanmar's National Land Use Policy stand in the way of information sharing, and capacity 2016 establishes a clear vision for developing national for collecting and utili6ing geospatial data remains at spatial data infrastructure (NSDI), with easy access a nascent stage. 100 Box 6.6: City Planning Labs in Indonesia The World Bank's City Planning Labs (CPL) infrastructure gaps interact. The city has long initiative supports cities in Indonesia to develop faced challenges relating to land subsidence, with a unified spatial data infrastructure, with a view impacts that include increased vulnerability to to improving data-informed urban planning. flooding, as well as physical damage to buildings Challenges faced by cities in Indonesia are not and infrastructure. The figure below illustrates dissimilar to those in other fast-urbani3ing areas, two overlays of spatial data - one showing land including uneven service delivery and the need subsidence and population density, and another for increased resilience to climate change risks. showing the distribution of the water supply CPL works closely with municipal governments pipe network. In areas that are underserved by to establish policies and procedures for agencies the existing network, land subsidence is higher, to collect and share data, develop tools for data likely as a result of residents continuing to tap on collection and analysis, and build capacity of the local groundwater supply. With higher levels city-level staff to understand and make use of of land subsidence, land in these areas is also the data available. The long-term goal of CPL is more affordable than in other parts of the city, for Municipal Spatial Data Infrastructure (MSDI) leaving more low-income families to settle there. to be managed and maintained independently by Planners can make use of this information to local governments. plan an expansion of the water supply network, in order to improve basic service provision and In Semarang, one of two pilot CPL cities, spatial break the cycle of persistent groundwater usage analysis has allowed urban planners to understand causing further land subsidence. how poverty distribution, land subsidence and Figure 6.5: Land Subsidence, Population Density and Water Supply in Semarang Land Subsidence Population Land Subsicence Water Pipe (cmlyr Denst 10 sq M (cr) Network 04 3 0-4 In Land 4-8 O 4-8 Subsidence Zones >8 OOverall Myanmar's National Land Use Policy 2016 sets out equally ambitious goals for the development of NSDI. Beyond the establishment of an NSDI framework, the application of available data should also be considered, e.g. as part of capacity-building for improved urban planning. Source: World Bank, 2018. 101 Encouraging participatory planning approaches to important for marginali6ed groups, including women, build inclusive urban environments. Participatory ethnic minorities and the disabled, to have a voice in approaches are also critical to informing planning shaping the urban environment. The Asia Foundation's for inclusive urban development. Rather than City Life Survey found that women in Myanmar were adopting a business-as-usual approach that treats twice as likely than men to not know how much planning as a purely technical or bureaucratic influence they have over decisions made by their process, participatory approaches emphasi6e municipality. As a first step towards ensuring that citi6en participation and stakeholder involvement planning in Myanmar is more attuned to the needs of as integral parts of an iterative planning process. different groups in the community, data that can be By involving a broad range of stakeholders from the disaggregated by age, gender, ethnicity, religion and start, participatory approaches can be particularly disability should be collected (Asia Foundation, 2017). 6.4 PROMOTING SOCIAL INCLUSION Anumber of subgroups in Myanmardo not fully benefit various forms of economic, political, and cultural from urbani6ation such as the urban poor, the disabled, discrimination against migrants are important as some ethnic groups and some migrants. There are are tackling stereotypes and promoting intercultural many countries that have addressed social inclusion dialogue and understanding. For Myanmar, there through strong social programs and improving the are important opportunities for such awareness rights of citi6ens. In Myanmar, high priorities are raising, targeted programs in linking migrants with policies that target assistance to vulnerable groups, job opportunities, facilitating migration through and help to allow for formali6ation of their identity in affordable loans or subsidy programs (as was done the city can help to promote inclusion. in a famine prone region in Bangladesh, Bryan, Chowdhury, and Mobarak 2014), and ensuring rental Targeting social programs. Programs that reach and affordable housing options can facilitate their marginali6ed groups such as the disabled or new transition to the city. Vietnam offers several types of migrants that may not have the skills or networks financial assistance to migrants, including loans with to find employment are in need. A number of policy preferential conditions and the "62 Poorest Districts" recommendations have been raised in the 2017 program which pays travel-related expenses and report on Disability (Ministry of Labour, Immigration provides preferential credit to poor workers. In the and Population, 2017). For the disabled in urban China Rural Migrant Project (through the Government areas, there are good practice examples from other of China with World Bank support), information, countries that use universal design approaches to employment assistance, and other services are used planning including the Vietnam Scaling Up Urban to enhance migration as ajobs strategy. An approach Upgrading Project (Box 6.2) which implements focused on improved access to skills through training technical standards for accessible infrastructure and in rural areas for urban jobs (as defined by the transport and universal design approaches in urban urban employers) through training center- employer environments, roads, schools and public facilities. partnerships, reductions in the cost of job search Speciali6ed school programs would allow many through enhanced employment services and legal children, who are currently unable to attend school, aid to services to migrant workers. An evaluation to attend. of the program after 6 years of implementation has found that beneficiaries found work more quickly in A focus on migrant populations is important for social their field of study, acquired jobs with higher wages, inclusion in urban areas. International evidence shows and increased their acquisition of formal qualification that policies to remove obstacles linked to migration certifications.34 status for access to services, and addressing 34 World Bank, Rural Migrant Skills Development and Employment Project, 2008-2015 102 Facilitating accesstolegaldocumentation. Evidence Many minorities in Myanmar have difficulties in from other countries shows that enabling the flow of obtaining legal documents. In the urban context, people through migration, particularly when driven by this is a particular challenge for residents in informal economic forces, is a positive and selective process settlements, especially migrants, and is a main (World Bank, 2009). Stemming the flow of people obstacle hindering their access to formal employment, can create unnecessary friction and impose the municipal services and low-interest loans. Reforms cost of forgone opportunities for economic growth are needed to ensure access to documentation, such and convergence in living standards. By removing as the National Registration Certificate (NRC) which obstacles linkedto migrationstatusforaccessto basic is often required to be employed in larger factories services such as health and education, and addressing but only available for those with a permanent various forms of economic, political, and cultural address. Such policies are a deterrent to inclusion discrimination against migrants, governments can and can perpetuate the cycle of poverty. China, well foster economic growth and promote social inclusion. known for their'hukou' household registration system that similarly put rural migrants at a substantial disadvantage in accessing urban services has made changes over time to eliminate such policies and increase opportunities for new urban residents. Box 6.7: The ID4D Program The World Bank, through the ID4D Program, has and is being used for several public purposes such experience in helping over 20 countries analy6e as digiti6ing government subsidy flows, financial problems, design solutions, and implement services, recording attendance for government new systems to increase the number of people employees to reduce absenteeism, and issuance with official identification and the development of passports, identity cards, and other forms of impact of the overall identification system. IDs (Banerjee, 2015). The program now reportedly When more people have formal identification and reaches 99 percent of all Indians over the age of identification systems function well, individuals 18. Available analysis concludes that the program access necessary services, governments function has value in enabling previously marginali3ed better, use resources more efficiently, and populations to be included in a number of welfare improve statistics to better inform their future programs and has much potential in enhancing policies. Different countries have used different transparency in the delivery of government registration systems, with the use of biometrics services, though concerns on security, privacy now being employed widely in Indonesia, (e-RTP), and any impact on efficiency have also been India (Aadhaar), and elsewhere. These programs raised (Rhera, 2018). create a unique identity number for every resident using biometric identification. In the case of India, For Myanmar, reforms to moderni5e and improve for example, the Aadhaar program aims to achieve transparency of the current identification social inclusion and more efficient public and system are needed and would have the potential private government service delivery by providing to contribute substantially to improving social an ID for residents that didn't previously have one, inclusion. 103 6.5 FOSTERING GOOD GOVERNANCE AND FINANCING FOR INCLUSIVE URBAN DEVELOPMENT As Myanmar transitions from a highly centrali6ed Strengthen participatory planning involving system, strong institutions and good governance will communities and citi5ens for stronger local be important at the local level to foster an inclusive government accountability for inclusive urban approach. Decentrali6ation efforts are still nascent, development. Engaging communities and citi6ens and while urban service delivery functions have been in decision-making processes is important in devolved to subnational governments, in practice, strengthening policies, enhancing service delivery, local governance is often hampered due to limited and ensuring social stability in cities. Enhancing implementation of policies/frameworks, financial community participation ensures that priority needs resources, and technical capacities. Key elements are identified and that local governments are held of transparency and fair decision making as well as accountable. Empowering urban dwellers to actively sufficient resources are necessary to foster inclusion. engage and contribute in their cities is a powerful Evidence from other countries shows that engaging way of promoting inclusion. Currently, the TDACs of communities and citi6ens in decision-making DAOs are composed of seven members, of which four processes is a powerful way of promoting inclusion are indirectly-elected community representatives. (Baker & Gadgil, 2017). Among key priorities are Local planning can be further enhanced with stronger improving coordination and operational processes community participation requirements in the planning for urban planning, management and local service processes. delivery, incorporating participatory planning in decision making, and developing a comprehensive Develop a comprehensive approach to improving approach to increasing financing for urban financing mechanisms for inclusive urban development. development. Local government financing is not adequate for the municipalities to fulfill the devolved Strengthen coordination between the various service delivery responsibilities. While the 2008 government agencies and streamline operational Constitution devolved urban service delivery roles and processes related to urban planning, management responsibilities to local governments, in reality, its and local service delivery. Building inclusive and functions are hampered due to insufficient resources sustainable cities require strong institutions and good to successfully implement programs and policies. governance at all levels of government. Currently While state/region governments are heavily reliant there is a lack of integrated planning and budgeting on inter-governmental fiscal transfers from the Union with little vertical/hori6ontal coordination and cross- Government, municipal governments such as DAOs sectoral planning between government agencies. As are mostly self-funded. While larger municipalities there is no parent ministry for DAOs, urban planning may be able to raise enough revenues to cover the and implementation processes (such as policy cost, many medium and smaller towns struggle to development, financial systems, procurement, O&M) raise the necessary revenues. A holistic approach are not streamlined, and the state/region governments (considering both vertical and hori6ontal constraints) must take-on an increasingly important role in to improve the SNG financial mechanism, including this area. Strengthening hori6ontal/vertical/cross- revenue allocation, budgeting, and financing capacity sectoral coordination and streamlining operational is a high priority. Among key elements: processes are critical to improving the efficiency of local service delivery. In parallel, efforts are needed to a. Intergovernmental fiscal transfer mechanisms build capacity to implement such priorities, to improve disparities across SNGs. While there have been efforts to improve transfer mechanisms, distributional impacts remain 104 Box 6.8: From Suppression to Cooperation -Bottom-Up Community Development in Airin District, Japan. Airin District, a densely-populated community Owing to such efforts by the CDAG, in 2012, the located in Nishinari, Osaka, Japan, was a town City of Osaka launched an extensive Project notoriously plagued with poverty and crime from called the Nishinari Special District Vision the 1960s to 1990s. In 1966, the City of Osaka, (NSDV), which aimed to revitali6e Airin District. the Prefectural Government of Osaka, and The Project was based on a bottom-up approach, the Prefectural Police Department designated allowing community improvement measures Airin District as a priority 6one requiring special to be implemented at an unprecedented rate. measures to suppress illegal activities and riots The Project led to a significant change in the by organi6ed gangs. While extensive measures public perception of Airin District, which was were implemented over 30 years, fundamental traditionally perceived as a dangerous, dirty and issues of the communities were not resolved. untouchable town. The NSDV was fully launched Airin District remained stigmati5ed and distrust in FY 2013 with a 6.7 billion JPY investment over between the residents, day laborers (commuting five years, aimed to transform Airin into a "town from outside Airin), and the local governments where children's voices can be heard." The short- remained intense. term phase of the Project aimed at improving sanitation, public safety and the community To address the complex challenge of environment through such measures as unemployment, homelessness, aging population, tuberculosis prevention, installation of security and crime, social action groups in Airin Districts cameras and street lighting, and enforcement on called for the Japanese Government to implement illegal dumping and illegal parking. Many of these assistance measures aimed at the protection efforts were organised by community residents and independence of the district's homeless with the cooperation of the local government population. This was a shift in approach - from and have significantly improved the district's one of confrontation and suppression to one environment (i.e. illegal dumping and parking has of cooperation and engagement. In 1999, a been cut by half) and reduced crime rates. In the committee, led by professional practitioners, longer term, provisions for housing upgrades and researchers, and civil society, was established employment generation (through new businesses to address the various issues and needs of the such as international tourism) are anticipated. Airin community. In 2005, the Community Development Action Group (CDAG), consisting For Myanmar, Airin's participatory planning and primarily of community residents, was established community driven development strategies serve and thereon made extensive efforts to reach out as an example on ways to strengthen community the various stakeholders in the community. ownership and government transparency and accountability - factors that are essential to inclusive urban planning and development. Source: Shirahase, 2018 limited and there is much room to improve regional and special goods taxes from SOEs filing at LTOs disparities. For the Union general-purpose grant, to be redistributed across the regions in a more a rules-based mechanism was introduced as part equitable manner. However, regional disparities of the MTFF reform to ensure a more transparent are still significant and further improvements and equitable hori6ontal allocation of fund. For may be considered to equali6e the fiscal capacities the Union tax revenue sharing, equitable policy of SNGs. changes were introduced to allow for commercial 105 b. Own-sources revenue generation which will equity and blended finance). While Myanmar has allow SNGs to have higher discretion over the implemented various forms of PPPs in several use of funds to meet local needs. For DAOs, sectors on big-ticket projects, PPPs at the local which are uniquely self-funded, strengthening the level remain limited, primarily due to weak fiscal performance of own-source revenue generation is capacity of SNGs and the inability to develop critical to execute their mandated responsibilities bankable projects and/or structure competitive of social service provision and local economic and transparent transactions. Furthermore, governance. However, effective revenue collection currently there are no national/sector policy and management remains one of the largest frameworks or institutional management operational challenges of DAOs, especially for functions dedicated to PPPs. The role of the medium and smaller towns. At the state/region private sector in development assistance is level, own-source revenue generation outside of being explored in the forthcoming Development Yangon and Mandalay remain weak, with most Assistance Strategy developed by DACU, however state/region governments relying on Union there is much capacity building required for both transfers for approximately 90 percent of their the public and private sectors. revenue source. Such state/region governments may underperform in generating their own- e. New revenue sources, including innovative source revenues because of the presence of financing mechanisms such as Land Value intergovernmental fiscal transfers which may Capture. Innovative infrastructure financing serve as a disincentive to generate local revenues. mechanisms such as Land Value Capture (LVC) Strengthening of own-source revenue generation has been utili6ed around the world to finance is critical for SNGs (especially DAOs) to execute urban infrastructure projects. Yangon and their mandated service delivery responsibilities possibly Mandalay may have the conditions to and have discretion over the funds to respond to introduce LVC, including strong economic growth, the actual local needs. rising real incomes, and increased motori6ation and congestion, which are all factors that may c. Property tax system with a long-term vision. contribute to land value appreciation around While Myanmar has a functioning property tax improved urban infrastructure. However, adoption system, revenues from property tax currently of LVC schemes and techniques would require plays a small role compared to other SNG revenue prerequisites, such as a complete and formally sources. By strengthening the property tax adopted detailed city base map, land use 6oning system, it can become a major revenue source including floor area ratio (FAR) demarcations, for SNGs. In the short/medium term, building building regulations and permit procedures. awareness, strengthening tax administration (including tax base, valuation methods, record keeping, tax rates/billing, collection and enforcement), and adjusting tax policies would establish a stronger, fairer and sustainable system. As with many countries, property tax is a contentious subject and actual revenues from collections may remain modest in the short/ medium term. However, in the longer term, a robust and well-functioning property tax system may become a critical revenue source for larger cities such as Yangon and Mandalay. d. Private sector financing for inclusive urban development. Both international and domestic private resource flows have increased significantly in Myanmar since 2011 and the growing appetite presents an opportunity for cities to leverage the private sector in financing inclusive urban development (including PPPs, guarantees, 106 6.6 CONCLUSIONS AND PRIORITY AREAS FOR FUTURE RESEARCH This report has brought together a large amount of DEVELOPMENT PARTNER accumulated knowledge from existing studies that ASSISTANCE ON URBAN have largely been carried out over the past five years. The information provides a basis for understanding key issues facing inclusive urbani6ation in Myanmar, with a particular emphasis on Yangon and to a lesser While international donors and development partners extent Mandalay. As discussed in this chapter, there (DPs) have provided substantial amount of technical is much work to be done in increasing investments in assistance and grant-aid/loans (Table 6.2), Myanmar's cities and in implementing reforms. The World Bank financing, planning and implementation capacity and and other donors are increasingly engaging in the speed has not kept up with the recent urbani6ation urban sector in Myanmar, with scope for scaling up and commercial development. To address the capacity to assist with the reform process. The sections below weaknesses, DPs have provided various forms of briefly summari6e key donor activity and areas for capacity building assistance at both the national and future research. subnational level, however these efforts have not had a sustained impact beyond the period of assistance. Given the scale of urban infrastructure and capacity building needs, a robust coordination among donors and DPs is essential. Recogni6ing the importance of coordination and information-sharing platforms, Cooperation Partners Group (CPG) working groups for various sectors, including urban, have been formed. The working groups are anticipated to allow DPs to help consolidate around high needs issues and develop efficient assistance programs that more holistically considers strategic needs and the work of various DPs. IIN Lh7 , 6-N;w r~I Table 6.2: Development Partners in Myanmar: Urban Sector Engagement Development Sector Details Partner Engagement World Bank (WB) Asia National Community Driven Development Project (2013-) Development Moderni5ation of Public Finance Management (2014-) Bank (ADB) Towards a Sustainable Land Administration and Management System in Myanmar - Land Sector Needs Assessment; Thematic Policy Notes (2017) * Myanmar Southeast Asia Disaster Risk Management Project (2017-) * Myanmar Urbani6ation ASA (2017-) * Myanmar Subnational Public Expenditure Review (2018-) * Myanmar Urban Transport ASA (2018-) Asia Development Urban * Myanmar Urban Development and Water Sector Assessment, Bank (ADB) transport, Strategy, and Road Map (2013) water supply, * Yangon Urban Renewal and District Cooling Project (2014-) wastewater * Myanmar Transport Sector Policy Note: Urban Transport (2016) mgmt., drainage * Transformation of Urban Management in Myanmar (2016) and flood * Mandalay Urban Services Improvement Project (2016-) (co- protection, solid financed with Agence Franqaise de D6veloppement (AFD)) waste mgmt. * Yangon Urban Services Improvement Project (2018-) Japan International Urban * Strategic Urban Development Plan of the Greater Yangon (2013) Cooperation Agency development, * Urban Development Plan for Regional Cities - Mandalay, Pathein and (JICA) urban transport, Mawlamyine (2016) water supply, * National Transport Development Plan (2014) sewerage * Comprehensive Urban Transport Plan of the Greater Yangon (2014) and drainage, * Preparatory study for Yangon Urban Mass Rapid Transit (2015) housing finance * Yangon Circular Railway Line Upgrading Project (2015-) * Improvement of Water Supply, Sewerage, and Drainage System in Yangon City (2014) * Preparatory Survey for Greater Yangon Water Supply Improvement Project Phase 11 (2017) * Improvement of Water Supply System in Mandalay (2015-) * Myanmar Data Collection Survey on Housing Finance System (2018) * Housing Finance Development Project (2018-2022) UN-HABITAT Urban planning, * Guidelines for Urban Planning for Myanmar (2016) land, housing * Land Administration and Management Program for Myanmar (2016) policy, informal * National Housing Policy and Strategy (2017) settlements and * Mapping Yangon: The Untapped Communities (2017) (with Cities slums Alliance) * Support for the National Spatial Development Plan Asia Foundation Governance and * Fiscal Decentrali6ation in Myanmar Towards A Roadmap to with Myanmar Finance Reform (2014) Development Research * Municipal Governance in Myanmar (2015) Institute: Centre for * Provision of Public Goods and Services in Urban Areas (2016) Economic and Social * State and Region Financing Budgeting and Planning (2016) Development Renaissance Governance * Managing the Challenges of Rapid Urbani3ation: A Review of the Institute and Finance, Existing Property Tax System in Myanmar (2017) property tax * What is the Wallet? Public Money in Myanmar's States and Regions (Brief Budget Series: Country Overview) (2018) Department for Urban * Cities and Infrastructure for Growth Technical Assistance (2018-) International development Development (DFID) Source: Based on discussions with development partners 108 AREAS FOR FUTURE DIAGNOSTIC WORK In the context of preparing this study, several areas for future analytical work been identified which are summari6ed below. This list is in no way exhaustive but rather suggestive as it relates to key policy priorities. Intra-city spatial analysis. Overall, much of the work could be deepened with better city level data to carry out intra-urban analysis particularly in Yangon. This would capture key issues related to urban poverty, mobility and access to jobs and services, housing conditions, and exposure to risk. Some of this would be possible with further analysis of the 2014 Census data and high resolution satellite imagery. Secondary Cities. Information on secondary cities was limited but would be beneficial for analysis of economic potential, and key needs. One suggested approach is to carry out Economic Potential Index analysis which analy6es the economic potential across municipalities and districts defined as determinants to high productivity.35 The indicators typically used are market access, transport connectivity, economic density, urbani6ation, and human capital. Combined, these factors can provide insight into the potential productivity of a district, or for Myanmar, a township. Urban Land. In-depth analysis on a range of issues related to urban land is needed: analysis Affordable Housing. Given the substantial needs and mapping of the different land types, legal for affordable housing, there are a number of arrangements, land administration practices, subtopics that would benefit from additional valuation and taxation practices, and assessment study beyond the recent review of Yangon's of the current policy, legal, institutional and Housing Market. Key areas include a deeper service delivery frameworks with an exclusion understanding of constraints in the housing lens for certain groups (residents of informal market and priority recommendations for settlements, women, poor, peri-urban residents reform, viable models for PPPs in affordable in areas where city boundaries are unclear). housing, opportunities for housing finance, and differentiated options for home ownership or rental across different income groups. Employment barriers for migrants, women and the urban poor. Several issues have been raised in the literature regarding employment barriers for subgroups. A more in-depth analysis of these issues with an aim to further identify policy recommendations that are in need of reform to 35 See Roberts, 2016 reduce exclusion in the labor market are needed. 109 Table 6.3: Priority Policy Recommendations by time Frame THEMATIC SHORT TERM MEDIUM TERM LONG TERM AREA YEARS 1-2 YEARS 2-3 YEARS 3-5 Identify high risk areas, needs and upgrading plans ECONOMIC INCLUSION Secure Begin financing implementation Ensure gender equality in access Develop enabling environment and incentives to foster microfinance Transport investments to enable rmobilty to jobs and markets Prioriti6e vulnerable groups Invest in access and quality Identify and prioriti6e Begin high risk areas implementation Design and implement Ensure approach to reach the most vulnerable 110 THEMATIC SHORT TERM MEDIUM TERM LONG TERM AREA YEARS 1-2 YEARS 2-3 YEARS 3-5 SPATIAL nvest n nfrastructure needs water, sanitaton, roads, INCLUSION drainage, sold waste management Create enabling environment for housing supply and demand Diagnostic needs assessment and development of affordable housing plan Ensure target is for low income populations Develop approach to incentivi6e private sector for low income market * Begin implementation Inpl rnent theNational Land Use Polc 0 Enable and train staff for implementation Alg nplans across agencies (nd use, transport, environrnent, d aste r sk)l Set up coordination mechanism Invest in geospatial data and sharing platforms (e.g. plan for national spatial data infrastructure) Ensure planning is gender and disability-informed 111 THEMATIC SHORT TERM MEDIUM TERM LONG TERM AREA YEARS1-2 YEARS 2-3 YEARS 3-5 SOCIAL INCLUSION Identify and prioriti6e Program design and begin needs implementation Awareness raising, Program design and education implementation Policy Reform Identify equitable approach and design system (S) Begin implementation GOVERNANCE AND FINANCE Carry out diagnostic assessment of processes and develop recommendations for Prioriti5e efficiency for core urban services Carry out institutional Implement Changes in a phased mapping and assessment manner for core agencies and Invest in capacity building services Mainstream participation in urban planning and program design Train relevant staff Ensure low income communities are included 112 THEMATIC SHORT TERM MEDIUM TERM LONG TERM AREA YEARS1-2 YEARS 2-3 YEARS 3-5 GOVERNANCE AND FINANCE Improvements in enabling environment Address existing bottlenecks Invest in capacity building through reform Diagnostic work to identify Begin implementation Approach for reform Diagnostic work to develop proposals for increasing property tax revenues Develop transparent decision making and implementation process Invest in capacity building Address existing bottlenecks through reform Carry out diagnostic work to identify opportunities Implementation 113 REFERENCES Action Labor Rights. 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" !� .. г�. � г � ьввw а i 61 г.. ..: �' . � � ..�. iw, 21 IL U L i wii& i' 1,qL ik Y474, lift, lit it] Vk Reell[ rp -05 _Äjk 4 AC/x ýa For more information and the full report, please visit: www.worldbank.org/myanmar WORLD BANKGROUP Ä- 15