Urban Development / Governance / Human Development
Governance for Charter Cities
Laws and governance for new cities
New-city projects announced in sub-Saharan Africa from 2010 to 2021, against 14 before 2010
City dwellers in sub-Saharan Africa who live in slums (UN, 2024)
Executive Summary
The economist Mark Lutter founded the Charter Cities Institute (CCI) in 2017. It works on the laws and governance that new cities need. Its 2021 Governance Handbook pointed out that there were firms to plan, finance and build new cities but no complete guide to designing their legal systems.
CCI builds on Paul Romer's 2009 idea of charter cities, which are new cities with new rules. The Handbook proposes rules for sixteen areas of law. CCI's New Cities Map counts 353 new cities announced between 1945 and 2021. The institute also advises governments and runs the New Cities Summit.
Who's behind this
Why some governments are building new cities as well as expanding existing ones
Africa's urban population is projected to double from about 700 million in 2020 to 1.4 billion by 2050, and cities are expected to absorb four-fifths of the continent's population growth over that period. Another of our initiatives, Planning for Growing African Cities, helps existing cities plan their expansion. Some governments are also building new cities. CCI's Handbook argues that new cities can draw some of the people who would otherwise settle in existing cities, and can try reforms that are hard to start there.
What existing cities are up against
7.3% of a property's value to register it
Sub-Saharan Africa average, World Bank Doing Business 2020
About half of city dwellers live in slums
49.4% of the region's urban population in 2024, down from 51.5% in 2020 (UN SDG indicator 11.1.1)
Vested interests
CCI's Handbook argues that people who gain from the current rules stand in the way of reform in existing cities. Current landowners, for example, resist land value taxes, which would tax away gains they make simply from owning land.
Building on sparsely populated land
The Handbook argues that reform is easier in a new city on sparsely populated land, because such a city has fewer entrenched elites to oppose change. It also warns that no site is truly a blank slate, and that city administrators will have to contend with local social norms that work against merit-based hiring. In CCI's model most national laws do not apply inside the city, so the city needs its own rules and agencies.
A governance handbook for charter cities
CCI defines charter cities as "new cities granted a special jurisdiction to create a new governance system." Romer had proposed that a well-governed, high-income country could administer such a city as a guarantor of good governance. CCI instead proposes a partnership between the host government and a private developer. The host country delegates powers to the city by passing a law or by signing a concession agreement. A charter then sets the limits of the city's own administration and regulation.
What the city controls
CCI's Governance Handbook (2021) proposes rules for the areas the city controls. Kurtis Lockhart, Jeffrey Mason and Carl Peterson of CCI's research team wrote it, with guidance from Mark Lutter. CCI calls it "the most comprehensive undertaking to date" and says it should be used "as an adaptive reference guide, not as an immutable list of rules and steps."
Sixteen areas of law
The chapters include hiring and managing city officials, tax, dispute resolution, immigration, land, business registration, customs, labor, banking, education, healthcare, social protection and environment.
Step by step
Each chapter explains how its area of law affects economic growth, sets goals with measures of progress, and gives step-by-step advice on the policies and agencies needed.
How it was written
The team compared what the research says about each area with what is practical. It drew on 48 interviews with academics and practitioners, and 26 subject-matter experts commented on draft chapters. CCI said it would update the Handbook periodically as it learned more.
Model laws
CCI has published a Model Charter and Model Legislation for host countries and developers to adapt.
The city remains part of the host country
In CCI's model the charter city is not a sovereign state. Its Model Charter calls the city "an inalienable part" of the host country, and the Handbook treats each charter city as one part of a national development strategy.
Four of the Handbook's recommendations
Recruiting city staff the way the Bank of Ghana does, through several interview rounds in which senior managers and board members each hold a veto. The Handbook argues that the many vetoes make the process resistant to patronage.
Putting administrative services online, as Estonia has, to make administration more transparent.
Raising revenue mainly from land value taxes or land lease rents, which the Handbook favors because they do not discourage work or investment.
Holding officials to account in public, as Rwanda does. Its yearly audits of public spending are presented to the legislature and, at the annual National Dialogue, to citizens and the press.
Mapping new cities announced since 1945
Tommie Thompson, Kurtis Lockhart and Gilbert Siame introduced the New Cities Map in a 2024 report. They write that most research on new cities consists of qualitative case studies of single projects, and that there is no consensus on how many new cities have been built. The Map counts 353 new-city projects announced since 1945, more than three-quarters of them in the Global South. More than 160 were announced in the two decades to 2021.
What the Map is
The Map covers new cities announced between 1945 and October 2021, and its data are open under the Open Database License. CCI commissioned it, and Tommie Thompson was principal investigator. The Adrianople Group collected the data and built the software, and the International Growth Centre provided part of the funding.
What counts as a new city
A project qualifies if it calls itself a city, has or aims for at least 100,000 residents, has or plans a school, is master-planned with a central coordinating entity, and has or plans a governance structure of its own.
What a full entry looks like
The entry for Delicias, Mexico, shows that the city controls building permits and zoning and partly controls policing and buses. It has no control over business licensing, electricity or the school curriculum. Delicias can set the rate of one major tax, raises between a quarter and half of its revenue itself and, within set limits, can issue bonds without prior approval.
Coverage so far
Full records exist for the Americas and India. African entries have no governance data. For the remaining regions, the Map records only each city's location and whether it meets the inclusion criteria. CCI plans to complete the Map as funding allows.
Advising governments and convening city builders
CCI has advised governments in Zambia, Malawi and Zanzibar, and since 2023 it has run the New Cities Summit.
Zambia
In February 2023 CCI launched its Lusaka office and agreed to help the Zambia Development Agency and the trade ministry develop regulations for special economic zones. CCI and the Zambia Institute for Policy Analysis and Research (ZIPAR) signed a separate agreement to promote investor-friendly practices.
Malawi
In June 2022 CCI signed an agreement with Malawi's National Planning Commission to advise on the laws and governance of the eight cities in the government's Secondary Cities Plan.
Zanzibar
In 2024 CCI published two policy papers by Matthew McCartney. One compares Zanzibar's 2018 and 2023 investment laws with international practice. The other assesses how its special economic zones are developed, run and regulated. Both make recommendations to the Zanzibar Investment Promotion Authority (ZIPA), which administers the zones under the 2023 law.
The New Cities Summit
CCI's New Cities Summit met in Kigali in 2023 and in Nairobi in 2025. Its partners included the Rwanda Development Board in Kigali and the Smart Cities Council in Nairobi. The Nairobi summit drew 406 delegates from 33 countries. Topics included planning for rapid urban expansion and managing political and economic risk. The 2026 summit, co-hosted with the Waterfall City Management Company, is at Waterfall City, Johannesburg, on December 7 and 8.
What CCI is aiming for
CCI describes its mission as "empowering new cities with better governance to lift tens of millions of people out of poverty." The Handbook's authors expect some of their recommendations not to work perfectly in practice, and they urge city administrators to experiment and find new solutions.
Mark Lutter
Founder and Executive Director, Charter Cities Institute
Published by Center for Human Progress (US) Inc., a 501(c)(3) organization