Analysis of Local Economic Development in the Urban Informal Settlement Upgrading Programs

Authors

• George K. Nyamu, University of Nairobi, KenyaFollow
• Luke M. Obala, University of Nairobi, KenyaFollow
• Owiti A. K'Akumu, University of Nairobi, KenyaFollow

Author ORCID Identifier

George K. Nyamu: https://orcid.org/0009-0001-5358-8974

Abstract

This study examines the role of local economic development (LED) within informal settlement upgrading, using Kibera in Nairobi, Kenya, as a focal case. As one of the most densely populated informal settlements in sub-Saharan Africa, Kibera has been the target of multiple upgrading initiatives intended to improve housing, infrastructure, and living standards. However, the integration of economic development goals into these interventions has often been overlooked or insufficiently conceptualized. Employing a mixed-methods research design—comprising household surveys, key informant interviews with government and NGO actors, and field-based observations—this study investigated the extent to which upgrading programs have influenced local enterprises, economic activity, and employment creation. The findings revealed that although improvements in infrastructure and basic services have fostered a more enabling environment for informal businesses, critical constraints remain. These included insecure land tenure, displacement from established markets, limited access to financing, and weak linkages with the formal economy. The study argued that for slum upgrading to be genuinely transformative, interventions must extend beyond physical upgrades to incorporate economic inclusion strategies that strengthen local entrepreneurship, support the adaptive formalization of microenterprises, and integrate informal economic actors into broader urban value chains. This research contributes to policy and academic discourse by underscoring the importance of economically inclusive and context-sensitive approaches in the upgrading of informal settlements in rapidly urbanizing regions.

Keywords

Local Economic Development (LED), Informal Settlement Upgrading, Kibera Slum, Enterprise Development, Informal Sector Formalization, Market Integration

Disciplines

Architecture | Business | Entrepreneurial and Small Business Operations | Urban, Community and Regional Planning

Recommended Citation

Nyamu, George K.; Obala, Luke M.; and K'Akumu, Owiti A. (2026) "Analysis of Local Economic Development in the Urban Informal Settlement Upgrading Programs," Architecture and Planning Journal (APJ): Vol. 32: Iss. 1, Article 2.
DOI: https://doi.org/10.54729/2789-8547.1270