NATIONAL URBAN POLICY AND STRATEGY Executive Summary In 2010 approximately 58% of the population live in Java, with

population density 14,400 population/km2. It is noted that approximately 50% of the population (114 million people) live in urban areas, with significant growth rate of 5.89% per year, while the national growth rate only 1.17% per year. In 2025, it is estimated that urban population will reach 67.5% (152 million) and the rest scattered in rural areas. Therefore, sound urban management need to be prepared. National Urban Policy and Strategy (KSPN) is formulated to anticipate such rapid urban growth and to articulate National Long Term Development Plan (RPJPN) and the National Spatial Plan (RTRWN) as well. KSPN intended to enhance the role of urban areas as one of the basis of national and regional development, and to be a comprehensive reference for urban development until year 2025. The objectives of KSPN are : (1) Operationalizing the direction of a national urban policy as stated in RPJPN and RTRWN; (2) Enhancing the synchronization and coordination in planning and urban development. Strategic issues of urban development in Indonesia are as follow : (1) Role of cities as drivers of regional and national economic growth has not been optimum yet; (2) Disparity among cities and between urban and rural; (3) Less empowered urban community social capital, which potentially resulting poverty, social vulnerability, and local wisdom ignorance; (4) City economic development and fiscal capacity are not yet optimum; (5) Inadequate provision of housing, utilities and facilities (PSU); (6) Less efficient spatial planning implementation; (7) Environmental management, disaster mitigation and adaptation and climate change management are still less optimum; (8) Urban institutional and governance capacity are not optimal yet. Meanwhile, there are 3 main challenges of urban development : (1) Global competition that requires city to play a role as standard competitive place that can meet international activity and international level; (2) Decentralization and democratization of governance that demands increasing technical and financial capacity of the city, strengthening cooperation among cities, and regions, and enhancing role of provincial governments; (3) Climate change that resulting impacts such as natural disasters, endemic diseases, crop failure due to fluctuative weather patterns, which plead cities to have disaster preparedness and mainstream climate change impacts in urban development. For in facing the challenges, the basic concept of urban development, is adopted as follow: (1) City is a socio-spatial entity that able to meet the needs of all segments of its population; (2) The city is a center of growth that interlinked with other growth centers and surrounding areas; (3) Global cities and that are able to compete in global wide. Vision of a national urban development in year 2025 is creating of a city that are liveable, equitable, independent, and competitive in a sustainable manner for the welfare of urban communities, in accordance with the character of local potential and culture. Moreover, the missions of the national urban development are : (1) Enhancing distribution of development cities according to their function within the national urban system; (2) Improves cities economic development in productive, attractive, and efficient manner, by emphasizing leading potential and carrying capacity of resources; (3) Developing urban infrastructures and facilities that meet the Urban Service Standards (SPP) as well as promoting social and cultural development of society; (4) Improving the quality of urban spatial structure into account the carrying capacity of the environment and against

the threat of disasters and the impact of changes climate; (5) Improving the quality of urban governance to be transparent, accountable, and participative; (6) Enhancing the process of public communication and interaction in planning and urban development. The goals of national urban policies and strategies are consisting of : (1) Fulfillment of Urban Services Standards (SPP), synchronization Urban Services Standards (SPP) and Minimum Standards (SPM) in the urban sector; (2) Development of small and medium cities that can serve as centers of regional economic growth (Regional Activity Center/PKW) and increase urban-rural linkages as well; (3) Establishment of large cities that can function as centers of national growth (National Activity Center /PKN); (4) Achievement of urban / metropolitan cities that can compete at international wide (world city / global city).

Table of the National Urban Development Targets 2010-2025

PERIOD SCENARIO GOAL 1 The fulfillment of Urban Service Standards (SPP) and implementation of synchronization Urban Service Standards (SPP) and Minimum Standar Service (SPM) in the urban sector The whole cities National Mid (autonomous cities, Term Development provincial capitals, and the capital district) meet Plan/ RPJMN II (2010- the minimum 50% of SPP. 2014) The whole cities National Mid (autonomous cities, Term Development provincial capitals, and the capital district) meet Plan/ the minimum 70% of RPJMN III SPP. (2015-2019) National Mid Term Development Plan/ RPJMN IV (2020-2025) The whole cities (autonomous cities, provincial capitals, and the capital district) meet 100% of SPP. GOAL 2 The establishment of small and medium-sized city that can become the center of regional economic growth and increasing rural-city GOAL 3 The realization of large cities that can become the center of national growth GOAL 4 The realization of urban / metropolitan city that can compete at international level

30% of the cities of PKW (53 out of 177 cities) serve as a regional centers.

30% of the cities of PKN (11 of 38 cities) serve as national centers.

20% of the cities of KSN (1 of 7 KSN) serve as international cities / global cities.

60% of the cities of PKW (106 out of 177 cities) serve as a regional centers.

60% of the cities of PKN (22 of 38 cities) serve as national centers.

50% of the cities of KSN (4 of 7 KSN) serve as international cities / global cities.

100% of the cities of PKW (177 cities) serve as a regional centers.

100% of the cities of PKN (38 cities) serve as national centers.

100% of the cities of KSN (7 KSN) serve as international cities / global cities.

Note : RPJMN PKW PKN KSN SPP SPM = = = = = = National Mid Term Development Plan Urban areas that function to serve the activities of the provincial scale or some districts / cities Urban areas that function to serve the activities of an international scale, national, or a few provinces Established urban areas to encourage the development of border area Urban Services Standards Urban Services Minimum Standards

Policy and urban development strategy 2010-2025 are includes : (1) Increasing the role of cities as drivers of economic growth in local, regional and national wide that have climate resilient, as well as drives of people's welfare and poverty alleviation ("led urban development policy"); (2) Distributing urban growth centers to address the imbalance of development among regions and urban-rural as well ensure a mutual relation (decentralized concentration); (3) Promoting human development and socio-culture in urban development; (4) Encouraging cities and surrounding area to be able to develop local economy and improve fiscal capacity; (5) Enhancing the provision of housing and settlements that are feasible, affordable, according to the characteristics of the community, neighborhood, city typology and by conformity with the needs of infrastructures, facilities, and utilities; (6) Promoting the efficient cities land use (compact cities) supported by efficient and just urban land use; (7) Encouraging cities to improve the quality of environmental health and to be ready in facing climate change and anticipating disaster; (8) Strengthening institutional and human resources capacity principles of good governance, as well as encouraging visionary leadership. In principal, KSPN will be come reference of all related Ministries/Institutions in determining urban development program and will be in Government Work Plan and Work Plan. The financing of KSPN sourced from the state budget, local budget, partnership with private entities, international agencies, and other funding sources. The implementation of KSPN will be oversee by the National Urban Development Coordinating Team/TKKPN (Ministerial decision of National Development Planning Agencies/Head of Bappenas No. Kep.23/M.PPN/HK/02/2011), through facilitating technical assistance to local governments, coordinating the national periodic involving cities governments, the evaluating of urban development using indicators agreed upon, and through implementation of various supporting regulations.