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Urban Development

Cities in Eastern Europe and Central Asia: A Story of Urban Growth and Decline

MD Staff

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The urbanization experience of countries across Eastern Europe and Central Asia is quite unique, and for several reasons. To begin with, most of these countries attained high-urbanization levels under a centrally-planned system, in which non-economic factors were pivotal in shaping the spatial distribution of both the population and economic activities.

By 1989, close to 64% of the population in the region lived in urban areas. Cities were founded in remote areas and often created and consolidated around a single industry. While more than 25 years have passed since the fall of the Soviet Union, the central-planning legacy is likely to continue influencing the trajectory of urban areas in the region for decades to come.

Today, urbanization in Eastern European and Central Asian countries is also profoundly affected by demographic transition. Having experienced more than two decades of fertility rates below replacement levels, and currently suffering from negative net-migration rates, many countries in the region are experiencing an overall decline of their population. Compared to the rest of the world, countries in the region have much lower population growth rates, and are among the only countries experiencing both a decline of their total population and of their urban population.

With a smaller labor force available, cities across Eastern Europe and Central Asia are increasingly competing against each other to attract scarce human capital. On one hand, the region’s cities are facing population decline in unprecedented numbers and scale: between 2000 and 2010, 61% of the cities in the region were declining, losing on average 11% of their population. On the other hand, population growth is increasingly concentrated in a fewer number of cities.

Spatial GINI coefficients – which measure the degree of concentration of the population across cities in each country – increased in all but 4 out of 17 countries studied over the period 2000-2010.

Across the region, Central Asian countries, as well as Poland and Turkey, appear to be less affected by city population decline, whereas countries like Bulgaria, Albania, and Romania are seeing more than 80% of their cities declining. The rate at which cities are growing or declining also varies substantially within countries, with some presenting distinct spatial patterns.

In Ukraine, for instance, data (collected prior to the ongoing crisis) indicates that most of the cities in the eastern part of the country were declining, which contrasts with the growing trends observed in cities on the western side of the country.

Which Cities are Growing and Which Are Declining?

Data for more than 5,000 cities across Eastern Europe and Central Asia indicates that bigger cities tend to grow more (or decline less) than smaller cities. Capital cities and secondary cities also appear to have an advantage in attracting populations. The degree of economic specialization matters also, with cities that are dominated by one industry or economic sector (often called monotowns) growing much less (or declining much more) than their peers.

Location also matters. Being close to the coast or having a milder winter positively impacts city population growth. However, being closer to other, larger, cities can be detrimental to a city’s ability to attract a population, particularly when located in regions and countries undergoing demographic decline.

Is the decline in city population linked to economic decline? On average, cities that are shrinking in population do perform worse in economic terms than cities that are growing. However, in Eastern Europe and Central Asia, city population decline is not always linked to economic decline. In fact, some of the declining cities are performing at the same level, or better, than growing cities.

Policy Implications

Both growing and declining cities face uniquely challenging environments. Growing cities need to adapt their local infrastructure to ensure that the growing population is well-absorbed and integrated into the city, while avoiding urban sprawl and balancing urban growth beyond administrative boundaries (an increasingly common phenomenon in the region).

In many of the region’s growing cities, the population is moving from city centers – which are at times shrinking – towards suburbs. This suggest that there are issues with housing provision and/or inefficient land-use in those city centers that need to be addressed.  

City population decline has important policy implications at both the national and local level. Decline can often lead to fiscal imbalances, as the revenue base of cities is eroded, while the per capita cost of providing services increases. In addition, given the durable character of housing, decline can lead to housing vacancies, declining housing prices, and urban blight.

While many declining cities across Eastern Europe and Central Asia continue to focus their policy efforts on attracting a growing population, they should instead shift their efforts to better manage their population decline. Shrinking cities are not a new phenomenon, but the region is at an unexplored frontier – which poses both challenges and opportunities for countries as they manage urban development in the years ahead.

“Cities in Eastern Europe and Central Asia: A Story of Urban Growth and Decline is a report developed under the framework of the Global Research Program on Spatial Development of Cities, initiated by the World Bank and the United Kingdom’s Department for International Development (DFID) Growth Research team in 2014

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Urban Development

Smart cities hold the key to sustainable development

Armida Salsiah Alisjahbana

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Asia and the Pacific’s phenomenal development has been a story of rapid urbanization. As centres of innovation, entrepreneurship and opportunity, cities have drawn talent from across our region and driven economic growth which has transformed our societies. In southeast Asia alone, cities generate 65 percent of the region’s GDP. Yet the ongoing scale of urbanization is a considerable challenge, one which puts huge pressure on essential public services, housing availability and the environment.

How we respond to this pressure, how we manage our urban centres and plan for their future expansion in Asia and the Pacific, is likely to decide whether recent development gains can be made sustainable. It is of primordial importance to Malaysia as its economy powers towards high income status. In ASEAN countries, 90 million more persons are expected to move to cities by 2030. Accommodating this influx sustainably will determine whether the United Nations’ 2030 Agenda for Sustainable Development can be achieved, and the climate targets of the Paris Climate Agreement can be met.

An effective response calls for integrated planning across all levels of government. Greater consideration needs to be given to demographic and land use trends to anticipate their impacts and minimize environmental damage. These trends should inform our investments in infrastructure but also in water, energy and transport services. Closing the infrastructure gap in the region will alone require an additional $200 billion of investment a year until 2030. We know local government revenues are mostly insufficient and fiscal decentralization inadequate to respond to this need. Intelligent fiscal reforms to improve local revenues are likely to be necessary and we will need to consider how we can capture land value and use Public-Private Partnerships.

In the most disaster-prone region in the world, it is incumbent on us to reduce the risk of natural disasters to which millions of urban dwellers are exposed. By 2030, vulnerable populations living in extreme risk areas – along river banks, canals and slopes – are expected to have grown by fifty percent since 2015 in many of region’s major cities. Some cities, including Melaka, are participating in initiatives such as the 100 Resilient Cities, focused on community-based disaster risk reduction. Yet this effort needs to be given even greater scale if we are to achieve risk resilient cities in our region. Accelerating our multilateral cooperation and best practice sharing could make a valuable contribution to doing so.

New technologies hold great promise for more effective urban solutions. From smart grids and district energy solutions, or real-time traffic management, to waste management and water systems, smart technologies will enable our future cities to operate more effectively. They could also make them more inclusive and accessible for persons with disabilities. We have an opportunity to incorporate universal design standards and systems such as automated access to audio-based communications to improve accessibility to cities for persons with disabilities. We must encourage smart city developers to use standards which would give persons with diverse disabilities full access to the physical infrastructure and information others enjoy.

As we look to overcome all these challenges, the ASEAN Smart Cities Network designed to mobilize smart solutions throughout southeast Asia, is a welcome development on which we must build. The implementation of this network is something the organization I represent, the United Nations Economic and Social Commission for Asia and the Pacific, has worked to support. Combined with the ASEAN’s broader Sustainable Urbanization Strategy, it is helping provide much needed resource in the region to manage urbanization better. Twenty-six cities, including Kuala Lumpur and Johor Bahru are developing visions for their cities to apply technologies for smart and sustainable urban development.

The expertise being acquired is invaluable to the broader region’s effort. Malaysia has a leading role to play. At the 9th World Urban Forum Malaysia hosed last year, experts came from the world over to focus on cities for all and the New Urban Agenda. In October 2019, the 7th Asia Pacific Urban Forum will be held in Penang. My hope is that this can focus minds and galvanize support for best practice to be shared and sustainable urban development to be prioritized in Asia and the Pacific.

UNESCAP

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Urban Development

India pushes for greater uptake of electric mobility

MD Staff

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In the gold rush for global domination of the electric mobility market, India has thrown its hat into the ring. The Modi-led government announced last month that it would offer US$1.4 billion in subsidies for both buyers and manufacturers of electric vehicles and impose higher import tariffs to spur domestic companies to build vehicles.

The government aims for 30 per cent of its public transport to be electric by 2030. With prime minister Narendra Modi emphasizing that he wants India to lead across the value chain from battery production to smart charging to electric vehicle manufacturing. 

“Policies will be designed as a win-win for all who want opportunities in the automobile sector,” said Modi. Although he emphasized that public transport would remain the focus of the electric mobility push.

At present, India has only two electric car manufacturing companies, Tata motors and Mahindra. International car giants Hyundai and Kia Motors are developing electric fleets designed specifically for the Indian Market, with Kia signing a memorandum of understanding with Andhra Pradesh to aid in the growth of electric mobility in the state. Meanwhile, many cities planned trials of electric buses including Hyderabad, Chennai and Guwahati.

The issue of air pollution in Asia was discussed at the 2nd UN Science Business Policy Forum in Nairobi in March 2019. Dechen Tsering, regional director of Asia-Pacific for UN Environment, said that the Indian private sector had shown a lot of interest in developing electric cars, but the problem was still battery prices.

“They are struggling with how to avoid importing everything,” Tsering said. “They are trying to find out how much is available on the domestic market.”

The issue of renewable energy components availability in lower-middle income countries, remains a challenge. Often essentials such as solar panels or lithium batteries are not produced locally, or at least not at scale, which prevents the private sector from entering renewable energy infrastructure. Yet 92 per cent of Asia and the Pacific’s population— about 4 billion people—are exposed to levels of air pollution that pose a significant risk to their health.

According to the report Air Pollution in Asia Pacific: Science-based Solutions, if governments adopted 25 clean air policy actions—including promoting the use of electric vehicles— there would be less of a need for expensive pollution control. While the US$300-600 billion per year investment would be only one twentieth of the increase of US$12 trillion increase in wealth by 2030.

Arnico Kumar Panday, regional programme manager for atmosphere at the International Centre for Integrated Mountain Development, said that it was possible to create a rapid uptake of electric vehicles in Asia through taxes. He gave the example of Nepal, where cars running on petrol and diesel are taxed at 220 per cent when purchased, while electric cars at 10 per cent.

“The same car is cheaper as an electric than it is petrol or diesel,” Panday said.

Meanwhile, Nobuyuki Konuma, from the Ministry of Environment of Japan, said his country had used two approaches in tackling the apprehensible air pollution of 1970s Japan.

First, they had put in place strict regulations on factories emitting greenhouse gases in the form of the Air Pollution Control Act. Second, they had set strict standards for emissions from vehicles, both passenger and freight. Vehicles who cleared the stern regulations could get tax reductions, which were a great incentive to buyers as Japan has heavy taxes on vehicles.

“So consumers were encouraged to select those cars,” said Konuma.

Of the US$1.4 billion released by the Indian government, about US$1.2 billion has been earmarked for subsidies, US$140 million for charging infrastructure, and some US$5 million for administrative expenses and advertising.

UN Environment’s e-mobility programme supports countries, particularly emerging economies, in introducing electric mobility. It helps governments to develop policies, exchange best practices, pilot technology options, track electric vehicle uptake, and calculate emissions and economic benefits.

UN Environment

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Urban Development

District energy: A secret weapon for climate action and human health

MD Staff

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Banja Luka in Bosnia and Herzegovina is getting a new district energy system. Photo by City of Banja Luka.

If you’re sweltering in Delhi or shivering in Detroit and want affordable, environmentally friendly cooling or heating, district energy may be your best bet.

A district energy system is a network of pipes that heat and cool buildings across a neighbourhood or entire city. Modern district energy systems connect renewables, waste heat, thermal storage, power grids, thermal grids and heat pumps—delivering up to 50 per cent less primary energy consumption for heating and cooling.  Visionary cities and countries have been able to decarbonize heating and cooling and achieve high efficiency, renewable energy, and CO2 targets with modern district energy.

To replicate and scale up best practices worldwide, UN Environment launched the District Energy in Cities Initiative.

Consider just one of the District Energy in Cities Initiative’s 36 cities, Banja Luka in Bosnia and Herzegovina. With the help of the Initiative and the European Bank for Reconstruction and Development, the city updated its 35-year-old network. These refits increased the share of renewables by 75 per cent, cut harmful air pollutants by 94 per cent and saved US$1 million a year in fuel costs.

Well-designed district energy systems don’t just lessen climate change. They also bring benefits across the sustainable development agenda—improving human health by cutting air pollution, increasing access to affordable and clean energy, and creating green and decent jobs.

Similar benefits are being achieved across the District Energy Initiative’s 14 countries.

From India to Chile

District cooling is accelerating across India. Amaravati, the new state capital of Andhra Pradesh, is the first of the Initiative’s cities in India to receive investment from the Initiative’s partner Tabreed on a district cooling project for public buildings. The Initiative is supporting Amaravati to go further, innovating new technologies and expanding the mandate beyond public buildings in line with the objective of Chief Minister of Andhra Pradesh N. Chandrababu Naidu, who recently stated at the city’s annual Happy Cities Summit: “I want district cooling for all the buildings in Amaravati.”

Meanwhile, Rajkot is the first Indian city to include district cooling in its Smart City Plan: the US$49 million project will save up to 50 per cent of CO2 and electricity, significantly reducing harmful refrigerants and peak demand by up to 30MW.

 “We are working to make Rajkot a ‘Climate Resilient City’ and have already prepared an action plan and committed to reduce carbon emissions,” says Bina Acharya, the city’s mayor. “Rajkot’s energy consumption inventory shows that electricity consumption in the building sector is highest due to cooling and lighting. Rajkot is now moving forward with district cooling to reduce energy consumption in the cooling sector.”

Working with the Initiative, India has recently incorporated district energy into the Indian Cooling Action Plan as a priority technology to reduce the economic and environmental impact of the country’s skyrocketing cooling demand.  

Similarly, in Latin America, Chile has incorporated district energy under its National Heat Strategy and Presidential Plan to address air pollution. Recently, Chile’s Ministry of Energy signed a collaboration agreement with the District Energy in Cities Initiative and the county’s largest industry association to boost district energy.

“The importance of this agreement lies in bringing together public and private efforts,” says Ricardo Irarrázabal, Undersecretary of Energy for Chile. “We are beginning a long-term relationship with a common goal, to have more efficient energy and to reduce pollution levels in the southern cities of our country. In this way, we are advancing more and more in the energy modernization of Chile.”

A district heating project in the Chilean city of Coyhaique, led by the Regional Office of the Ministry of Environment with UN Environment, is part of an approach to cut air pollution. The regional government has set aside up to US$2.8 million for the construction and implementation of the first stages of the project.

These are all encouraging developments which show the potential to bring massive savings in energy use across the globe.

Heating, cooling and hot water mostly supplied by fossil fuels

Heating, cooling and hot water represent 60 per cent of energy demand in buildings, most of it supplied by fossil fuels. Cities contain over half the world’s population, consume over two-thirds of the world’s energy and account for more than 70 per cent of CO2 emissions.

Forward-looking cities are connecting district energy with efficient buildings, waste and renewables to create integrated urban systems and achieve resilience and circularity. This will be a topic of discussion at the Cities Summit during the 4th UN Environment Assembly. 

About the District Energy in Cities Initiative

In 2016, during the Habitat III conference in Quito, Ecuador, 197 nations adopted the New Urban Agenda, which recognizes modern district energy systems as a key solution to integrate renewables and energy efficiency in cities. The District Energy in Cities Initiative is coordinated by UN Environment with financial support from the Danish International Development Agency (DANIDA), the Global Environment Facility, and the Italian Ministry of Environment and Protection of Land and Sea.

As one of six accelerators of the Sustainable Energy for All Energy Efficiency Accelerator Platform, the Initiative aims to double the rate of energy efficiency improvements for heating and cooling in buildings by 2030, helping countries meet their climate and sustainable development targets.

The Initiative supports local and national governments to build know-how and implement enabling policies that will accelerate investment in low-carbon and climate-resilient district energy systems. It currently provides technical support to 36 cities in four pilot countries (Chile, China, India and Serbia) and 10 replication countries (Argentina, Bosnia and Herzegovina, Colombia, Egypt, Malaysia, Mongolia, Morocco, Russia, the Seychelles and Tunisia).

UN Environment

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