This paper reviews the trends in official development assistance for urban development. First, the paper documents the stagnation in the share of aid going into urban projects and programmes. It then documents what has been learned from experiences in urban aid and how strategies have evolved.

The paper also places urban development in the broader context of changes in the global aid architecture. It suggests that trends to improve aid effectiveness – a poverty focus, an aversion to risk, local ownership and managing for results – have tended to move in a different direction from the realities and constraints of urban interventions, making it harder for advocates of urban development to make their case heard. Donors who are trying to discipline their activities by applying broad principles of effective aid are likely to be put off supporting urban development by these apparent inconsistencies. The opportunity for the urban sector appears to lie in its rich experiences with partnerships. The paper analyzes partnerships between donors and other stakeholders in urban interventions and suggests there could be considerable learning for the urban sector from past successes and failures. It puts forward an analytical framework to allow a comparison of different partnership approaches. The paper concludes with areas for research that need to be explored if urban development is to gain greater prominence in the international donor community.