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Rethink Cities to Help Asia Make the Most of Urbanization

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Cities have always played a central role in economic development by bringing workers and entrepreneurs together, spurring innovation, and sharing resources including infrastructure more efficiently. This should be good news for developing Asia: by 2050, there is projected to be 2.96 billion people living in the region’s towns and cities – 64% of all the entire population – up from 1.84 billion – or 46% of the population – in 2017.

Unfortunately, while the region’s cities are sure to grow in size, they may fail to fulfill their potential as engines of growth and job creation due to underinvestment in urban infrastructure, a lack of affordable housing, and unsynchronized spatial and economic planning. 

What are policymakers to do?

First, they must achieve a more accurate and granular understanding of how their countries are urbanizing. New data sources are needed because official statistics often fail to capture the true urban footprint of cities since they rely on municipal boundaries drawn decades ago, for example.  Satellite imagery, however, shows clearly that developing Asia’s cities are expanding without regard to those boundaries, forming what we call “natural cities”. Our study, Fostering Growth and Inclusion in Asia’s Cities tracked almost 1,460 natural cities across developing Asia, with many of them in the People’s Republic of China (680 natural cities), India (320), and Indonesia (93).  Further, cities are merging to form integrated urban agglomerations; 476 natural cities that were separate in 1992 had linked up to form 124 city clusters by 2016, the largest being the Shanghai-centered city cluster, home to 91.5 million people, and encompassing a total of 53 natural cites, including Nanjing and Hangzhou, in the Yangtze River Delta area.

Urban expansion and formation of a city cluster in the Yangtze River Delta Area

Source: Asian Development Bank. 2019. Asian Development Outlook 2019 Update: Fostering Growth and Inclusion in Asia’s Cities. Manila.

This means urban planning cannot simply stop at the city limits. Efficient transport networks that extend from neighborhoods to workplaces prevent fragmentation of a city’s labor market. 

Similarly, as cities cluster, decisions on where to place vital infrastructure, such as water treatment and solid waste facilities, transport hubs, green spaces, and industrial parks require coordinated decision-making among local government units. Unfortunately, companies operating in city clusters are now significantly more likely than those in stand-alone cities to complain about infrastructure and regulatory bottlenecks. 

Second, policymakers must think of cities as labor markets.  To be sure, cities are much more than places of work. However, they cannot thrive unless they function well for both enterprises and workers.  This requires that travel within the city or city cluster is fast and cheap, that firms and households can easily relocate from one part of a city to another, and that real estate is affordable.

 Asian cities need to do a lot on these fronts.  Tests using Google Maps in 278 natural cities show considerable congestion during peak travel times in many large cities, such as Metro Manila, Dhaka, and Bengaluru.  Moreover, in 199 of the cities a full quarter of the surveyed trips could not be made by public transport at all, while for the other three quarters, travel by public transport including walking to and from the transport hub was three times longer than by car. 

This clearly shows that Asian cities must invest much more in efficient public transport if businesses are to attract workers and flourish. The transport system must combine trains, buses, taxis, ride sharing, and less formal services like jeepneys and autorickshaws—but regulating them well—to improve mobility. 

Affordable homes are also critical to attract workers, keep them as their skills and families grow, and then allow them to easily shift to other jobs. However, our analysis showed that that home prices are well beyond the means of median-income households in more than 90% of cities. What is needed to tackle that is a combination of demand-side and supply-side policies, including reassessment of land use regulations that might be inadvertently restricting the supply of real estate. 

Finally, growth requires vibrancy in all types of cities. Cities are connected to one another, and to the rural hinterland, through flows of goods, services, and people.  Robust and balanced national economic growth depends also on mid-sized cities and even market towns that specialize in distributing agricultural produce.  

This requires investment in efficient inter-city transport. Given competing demands on public funding, large cities should draw more on private sector funding. Such cities have an edge in attracting private investment because the agglomeration economies they generate promise high returns to those who choose to locate there. Allocations of public funds must follow the people.  Many medium-sized cities in the region with populations of 1–5 million and some smaller cities with populations of half a million still attract migrants.  Public investment should support that. 

Asia’s steady urbanization represents an unprecedented chance for the region to ensure robust long-term growth and the creation of good jobs.  Policymakers must not let the opportunity slip through their hands by neglecting their cities. 

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Urban Development

Guterres promotes ‘enormous’ benefits of greener cities

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For the UN Secretary-General, the benefits of making cities more environmentally friendly are “enormous”, and include reduced climate risk, more jobs, and better health and well-being. 

“City leadership in using green materials and constructing energy-efficient, resilient buildings powered by renewable energy, is essential to achieve net-zero emissions by 2050,” said António Guterres in his message for World Habitat Day, marked on Monday. 

The theme for this year’s celebration of cities and towns worldwide is Accelerating urban action for a carbon-free world. 

Cities are responsible for about 75 per cent of the world’s energy consumption and over 70 per cent of global greenhouse gas emissions.  

Two crises 

Urban areas across the globe are facing the dual crises of COVID-19 and climate change, said the UN chief. 

Around 4.5 billion people live in cities today, but that population is projected to grow by almost 50 per cent, by 2050. By mid-century, over 1.6 billion urban residents may have to survive through average summertime highs of 35 degrees Celsius. 

For Mr. Guterres, cities and towns are at the core of climate action to keep the 1.5 degrees goal within reach. 

“Three-quarters of the infrastructure that will exist in 2050 has yet to be built,” he said. “Economic recovery plans offer a generational opportunity to put climate action, renewable energy, and sustainable development at the heart of cities’ strategies and policies.” 

As populations grow in emerging economies, demand for transport, which accounts for nearly 20 per cent of global carbon emissions, is also multiplying.  

The UN Chief said cities are already working on this, trying to ensure that this demand is met by zero-emission vehicles and public transit. 

Mr. Guterres concluded asking for a global moratorium on internal combustion engines to underpin these efforts, saying it should happen by 2040 at the latest.  

Opportunity 

In a message for the day, Executive Director of UN-Habitat, Maimunah Mohd Sharif, said that, unless the world takes urgent action, “the greenhouse gases produced by ever expanding urban centres, will continue to push global air temperatures higher.” 

Ms. Sharif remembered that, this year, the day is celebrated only weeks before the UN climate change summit, COP26, happening in early November in Glasgow.  

For the UN-Habitat Chief, the recovery from the COVID-19 pandemic is an opportunity for the world’s cities to put climate action on top of their agenda. 

“This is a chance to change how we generate our power, construct our buildings, heat, cool and light up our offices and homes, and travel around from home to work,” she said. 

Ms. Sharif asked for “well planned and well managed compact cities”, that allow for non-motorized transport and that reduce energy consumption from cooling and heating. 

“Cities are the incubators of innovation and new technology,” she said. “We must harness this strength for better climate change solutions.” 

For Ms. Sharif, “action will differ from city to city”, but “the green transition must benefit everyone, especially the most vulnerable, and create new jobs.”  

Activities  

Events this year will explore how governments and organizations can work together with communities, academic institutions and the private sector to create sustainable, carbon-neutral, inclusive cities and towns. 

World Habitat Day will also amplify the Race to Zero Campaign and encourage local governments to develop actionable zero-carbon plans in the run up to the COP26. 

This Monday, in a ceremony in Yaounde, Cameroon, UN-Habitat will also present the winners of the Scroll of Honour awards, one of the world’s most prestigious prizes for those working on sustainable urbanization. 

This year, there are five winners: New Urban Communities Authority, from Egypt; Shining Hope for Communities, from Kenya; Baoji City, from China; Let’s do it World, from Estonia; and Ciudad Emergente, from Chile. 

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Urban Development

City Climate Finance Gap Fund completes first year of operation

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The City Climate Finance Gap Fund (the Gap Fund) has approved technical assistance for 33 cities across the developing world since its operational launch in September 2020, filling a critical gap in technical assistance funding to help cities turn their climate ambitions into finance-ready projects.

Marking its one-year operational launch anniversary today, the Gap Fund has received over 140 expressions of interests and approved technical assistance for 33 cities in India, Mexico, Ethiopia, Morocco, Democratic Republic of Congo, Panama, Senegal, Vietnam, Kosovo, Montenegro, Ecuador, South Africa, Vanuatu, Colombia, Indonesia, Brazil, Guatemala, Uganda and Ukraine. An additional 30 cities are currently undergoing a detailed assessment for potential Gap Fund support, with a total target of at least 180 cities.

The Gap Fund is currently capitalized at €55 million, with a target of at least €100 million and the potential to unlock an estimated €4 billion in investments. The aim is to help cities understand their exposure to climate challenges, develop plans and strategies to reduce emissions and vulnerability to climate risks, and identify and prioritize climate-smart urban infrastructure investments.

The Gap Fund demonstrates a unique collaborative model: With funding from Germany and Luxembourg, the Fund is co-implemented by the World Bank and the European Investment Bank in partnership with the Deutsche Gesellschaft für Internationale Zusammenarbeit and works directly with city groups and networks including GCOM, ICLEI, C40 and CCFLA. This concerted effort has helped raise awareness about the importance of cities and urban systems in the climate agenda and could not come at a more critical time, as the latest Intergovernmental Panel on Climate Change (IPCC) report confirms that cities are the hotspots of global warming, with the global urban climate finance gap estimated in the trillions of dollars, especially in South Asia and Sub-Saharan Africa.

The Gap Fund also contributes cutting-edge knowledge, tools and recommendations. For example, by featuring in theState of Cities Climate Finance Report Part 2: Enabling Conditions for Mobilizing Urban Climate Finance, whichprovides critical systems-level conceptual frameworks and recommendations for city, country and climate decision-makers. The Gap Fund has also developed or packaged user-friendly practical tools and notes for operational practitioners and project developers on the ground.

The way cities develop in the coming years, especially in these regions, will influence the trajectory of future greenhouse gas emissions, and the susceptibility of cities to increased flood risks and urban heat island effects. The focus on cities is also reflected in the World Bank’s Climate Action Plan, which has identified cities and urban systems as a focus area on a par with energy, transport, food and industry.

Some of the Gap Fund’s most recent grant activities include:

  • San Miguelito, Panama: Identify climate-smart and energy-efficient urban interventions for new cable car infrastructure, with the potential to cut emissions and reduce vulnerability to floods.
  • Dakar, Senegal: Integrate low-carbon and climate-resilient considerations into the planning, development and construction of affordable and green housing in the greater Dakar region, including piloting  a green building certification incentive for building developers.
  • Mangalore and Kolar, India: Prepare a climate diagnostic report for solid waste management as well as an action plan for improving and financing low-carbon solid waste management services, including a pre-feasibility study.
  • Bogota, Colombia: Provide technical assistance for greenhouse gas and air quality analytics, city-wide coordination and recommendations to incorporate low-carbon and climate-resilient considerations in the Low-Carbon Vital Neighbourhoods in Bogota– the first pilot in Latin America to implement a “Proximity City Urban Development Model” (also known as the 15-minute city model).
  • Chefchaouen, Morocco: Prepare a study on low-carbon solid waste management activities including waste sorting, biogas recovery, leachate treatment and the use of solar energy.
  • Vinnytsia, Ukraine: Support climate change adaptation measures along the Southern Bug River, such as new green spaces along the embankments, development of beaches to improve river transport and the construction of a new bridge to improve walking routes north and south of the city.
  • Campinas, Sao Paolo State, Brazil: Promote climate change adaptation and reduce flood risks through nature-based solutions along the Capivari river.
  • Danané, Côte d’Ivoire: Support the deployment of a fleet of 600 low-carbon, low-cost solar tricycle taxis to meet the city’s most pressing mobility needs for people, including expectant mothers, and cargo.
  • Escuintla, San José and Iztapa, Guatemala: Assess the quality of existing waste generation and characterisation data of municipal solid waste and make any necessary additions, compare organic solid waste treatment alternatives and suggest improvements to the existing organisational structure and governance.
  • Santa Marta, Colombia: Improve and enhance the city’s urban forest and forest management, and identify funding opportunities at regional, national or international level as well as links to other potential natural infrastructure projects along Santa Marta’s ecological corridors.
  • Rio de Janeiro, Brazil: Improve hydrological modelling to assess urban flood risks and economic modelling to assess the viability of restoring wetlands as a natural barrier in flood-prone areas and carry out stakeholder consultations.
  • Makindye Ssabagabo, Uganda: Study existing waste generation, carry out a characterisation study of municipal solid waste using random and seasonal data, and compare organic solid waste treatment alternatives.
  • Palembang, Musi Rawas and Lubuklinggau cities, Indonesia: Prepare a cost-benefit analysis, strategy and action plan for green, resilient construction and energy-efficient affordable housing in these three cities. Project would help inform the national Government One Million Housing program which aims to provide incentives for developers to build 220,000 homes per annum and to upgrade 160,000 affordable homes. 

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Urban Development

WEF Launches Toolbox of Solutions to Accelerate Decarbonization in Cities

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With the percentage of people living in cities projected to rise to 68% by 2050, resulting in high energy consumption, greater infrastructure needs and, carbon emissions, cities have a critical role to play in the race to reach net zero. To help address this challenge, the World Economic Forum, is releasing today the first iteration of its Toolbox of Solutions, designed and built in collaboration with Accenture.

The toolbox is an interactive digital platform containing more than 200 practical solutions to help city leaders, national governments and businesses evaluate and identify optimal solutions for near-term implementation, kick-starting their decarbonization journey. The first-of-its-kind toolbox draws on input and case studies from more than 110 cities, businesses, academics, civil society leaders and other urban stakeholders around the world and across sectors to capture best practices and case studies for urban transformation and decarbonization.

The solutions include policy, business and finance models that result in reduced emissions and other valuable outcomes such as job creation and improved air quality. These solutions are also tailored to specific city attributes including the electricity grid’s health, local population density and income level.

“Decarbonization solutions already exist – we don’t need to wait for the next big innovation. This platform provides examples of policies and business models that have been used successfully around the world. We are starting with 200 solutions and expect to have many more over the course of the next year,” said Kristen Panerali, Head of Energy, Materials and Infrastructure Programme, Net-Zero Carbon Cities, World Economic Forum.

“Urban ecosystems are pivotal in our global journey to net zero, driven by clean and smart electrification. These sustainability initiatives can help accelerate efforts to address climate change with practical and integrated energy solutions for urban transformation for cities of any size around the world,” said Jean-Marc Ollagnier, Chief Executive Officer, Europe, Accenture.

Achieving net-zero emissions at city scale will require a transformation in how energy is produced, distributed, and consumed. A related report shows how the built environment and mobility can serve as a catalyst for urban transformation and decarbonization anywhere in the world.

The Toolbox of Solutions is part of the Forum’s Net-Zero Carbon Cities programme, which brings together businesses with city, regional and national government leaders to accelerate urban transitions to a net-zero future. The programme’s objective is to align and scale efforts across businesses, cities and national-level governments to deliver urban ecosystems that are sustainable, resilient and equitable. The programme aims to enable transformation towards clean electrification and circularity, using integrated energy solutions to address energy, buildings and mobility. The Net-Zero Carbon Cities programme is co-chaired by Jean-Pascal Tricoire, Chairman and Chief Executive Officer, Schneider Electric, and Francesco Starace, Chief Executive Officer, Enel.

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