Urban Governance and Decentralisation Programme

Programme description

Title: Urban Governance and Decentralisation Programme – UGDP
Commissioned by: German Federal Ministry for Economic Cooperation and Development (BMZ)
Country: Ethiopia
Lead executing agency: Ministry of Urban Development, Housing and Construction
Overall term: 2005 to 2014

Ethiopia. Market area in southern Ethiopia. Photo Thomas Gross © GIZ


Economic and political problems due to high population pressure, inadequate infrastructure, unemployment: Ethiopian cities are growing rapidly and with them the challenges that the relatively young local governments face. Some basic public services are not available because of a lack of sufficiently qualified personnel, revenues and practical experience as well as institutionalised planning and administrative processes. Ethiopia is, however, forging ahead with a comprehensive decentralisation programme, devolving more responsibilities to the cities.

Despite these challenges, urbanisation offers enormous opportunities. Well managed, cities can play a significant role in reducing poverty, stimulating economic growth and ensuring good governance.


Urban centres and cities provide better services to their citizens and apply principles of urban good governance.


The Urban Governance and Decentralisation Programme (UGDP) supports the Ethiopian Government in implementing an extensive decentralisation process. It contributes to participatory decision-making, setting up efficient local administrative and planning processes and finally to the improvement of public services and the reduction of urban poverty. The programme is being jointly implemented by the Ethiopian Ministry of Urban Development, Housing and Construction, eight regions and 26 partner cities.

GIZ, KfW Development Bank and the Centre for International Migration and Development (CIM) run the programme on behalf of the German Federal Ministry for Economic Cooperation and Development (BMZ). The programme works closely with the German consulting firm GOPA Consultants in the field of financial management. The programme is also involved in a co-financing arrangement with the Bill & Melinda Gates Foundation (BMGF), under which it focuses on pro-poor urban development.

Until mid-2010, UGDP supported 18 pilot cities in the four main regions of the country. The lessons learned during the pilot project are being applied to eight other cities, including four in the remote and less developed regions.

The programme comprises the following components:

  • Improvement of urban planning and public service provision
  • Improvement of urban financial management
  • Expansion of municipal knowledge management
  • Pro-poor urban development

Results achieved so far

  • Cities have strengthened their administrative autonomy.
  • Civic participation in matters of spatial and financial planning as well as prioritising investments has been institutionalised.
  • Citizens' satisfaction with municipal service delivery has increased by 20% since 2010.
  • The municipalities currently supported have reported a revenue increase of more than 20% compared to 2009.
  • 100,000 jobs have already been created as a result of new infrastructure projects. Approximately one-third of these have been filled by women.
  • The Ethiopian Cities Association was founded. It provides a platform for the 28 member cities to share experiences and learn from one another.
  • In cooperation with the Ethiopian Civil Service University, the urban planning and administrative processes that GIZ helped to launch are now being scaled up nationwide.
  • All partner cities have access to funds from KfW Development Bank and the World Bank to invest in urban infrastructure.

Additional information