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Vietnam Can Lead ASEAN through the Smart Cities Network Vision

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When Vietnam takes over the ASEAN chairmanship in 2020, the country outlined five priorities to be executed throughout the year. Among all, strengthening the institutional capacity of ASEAN and leveraging the Industrial Revolution 4.0 to address inequality, are the most challenging goals to be realized within a year. Other scholars such as David Hutt, meanwhile, even pointed out that Vietnam’s most important goal is to secure a united stand on the Code of Conduct to be negotiated with China this year ⸺ a consensus that if achieved, will ensure any agreement regarding the contentious South China Sea dispute to be mutually favourable for all the disputants involved. 

That said, the unexpected outbreak of the COVID-19 has greatly disrupted Hanoi’s initial ambitions to drive the ASEAN agenda into new heights. Not only the global pandemic postponed the regional bloc’s summits and meetings to later dates, it also compelled leaders of all ASEAN countries to devote great focus on this outbreak at the ASEAN level. While the online Special ASEAN Summit last April was able to result in a joint statement to address the COVID-19 pandemic under the chairmanship of Vietnam, it was by no means, adequate for the country to play an active role as the ASEAN’s driver this year. Given the COVID-19’s disruption to ASEAN’s annual meetings and summits, it is not hard to see why Hanoi is seeking to extend another year of its chairmanship despite this may clash with Brunei’s preparations as the next chairman of the Southeast Asian bloc.

Utilizing Confidence Gain in COVID-19 Response

As the country which managed to control COVID-19 and keep it to an excessively low number of transmitted cases, Vietnam has gained an unprecedented confidence among its ASEAN peers as well as those outside of the region. As highlighted by Coleman and Sheehan, Vietnam became a new model of how a developing country can respond to COVID-19 without devoting mass resources for the purpose. Dubbed as low-cost COVID-19 strategy as coined by different scholars, the Vietnamese success stemmed on its abilities on three fronts: mobilizing all segments of society in responding to the crisis, initiating early prevention measures (mask-wearing policy, targeted testing, contact tracing and quarantine) and utilizing different technologies (website and app) for public communication.

With such coordinated measures, Vietnam has cast itself as an exemplary model in controlling the pandemic despite not having colossal resources in conducting mass testing and epidemic surveillance of South Korea, China and Singapore. As a matter of fact, the Vietnamese COVID-19 response model is a highly attractive model which can be readily emulated by other developing countries with limited resources at hand. Within ASEAN, the Vietnamese model can be replicated in Cambodia, Laos and Myanmar ⸺ countries that would need effective COVID-19 response strategy without their governments devoting huge costs for it. By occupying the ASEAN chairmanship status, its COVID-19 success resonated confidence from the whole regional bloc on its ability to play a leading role in this testing time. To take it further, such gain of confidence within ASEAN, should be further capitalized by Hanoi to implement regional agendas that would bring pragmatic returns to all member states in the short-run.

Pushing for Short-Term Goals within ASEAN Smart Network Cities (ASNC)

With the COVID-19 pandemic yet to be effectively controlled around the world and has the capacity to recur in the near future, no one knows how much longer would the restarted economies in the bloclast. This situation, in turn, made the ASEAN Smart Cities Network (ASCN) as reached by the Southeast Asian bloc in April 2018, an ever more important priority for immediate implementation. From Anbound’s observations, there are two reasons for such urgency.

First, with COVID-19 vaccine yet to be developed at least not in the immediate future, reduction in face-to-face engagements has become a norm of human interactions. As such, there is no other choice for ASEAN players, whether they are the governments, businesses and average citizens, but to adapt to this new norm in their daily activities. By pushing for the immediate implementation of the ASCN, Vietnam will be able to utilize technology to rejuvenate the economy and improve the lives of ASEAN citizens in the post-pandemic era.

By all means, this will establish Vietnam’s legacy as the chairman that brings ASEAN out of the socio-economic crisis that was brought by the COVIS-19 pandemic. Considering that the 36 cities have planned their strategic projects within the Smart City Action Plans document, what Hanoi could do is to call for an online meeting with the respective national leaders and relevant city mayors, and designate certain short-term goals to be realized by the end of 2020. These goals can be any easier and achievable goals in the three pillars of technological utilization, industrial automation and digitalization of economy.

Second, similar to becoming a model for COVID-19 response, Vietnam could also become another model of smart cities for the lower developing peers in ASEAN. In the course of adapting smart cities vision to its local conditions, Hanoi can share with their peers on how to kick-start smart cities governance in three different cities with three distinctive needs, namely, Hanoi, Ho Chi Minh City and Danang. As a latecomer to the smart cities game, these three Vietnamese cities have demonstrated their capabilities to prioritize smart solutions according to their local needs instead of developing all sorts of smart solutions in their localities.

Whereas Hanoi had started the iParking app for drivers and looking to venture into smart solutions in healthcare, education, transport, and tourism, Danang planned to become a green city through the adoption of smart solutions. As such, the latter’ had begun developing its natural disaster management systems that set it apart from Hanoi and Ho Chi Minh City. As for the southern city of Ho Chi Minh, it is planning to become the first smart city of Vietnam and placed emphasis on attaining five capabilities for achieving a comprehensive smart city: development of cloud computing infrastructure, utilization of Big Data, building of data centres, erection of security centres, and establishment of an open data ecosystem. Without question, the cost-effectiveness approach of these three Vietnamese cities, is highly relevant to those lower developing peers in ASEAN in which limited resources are available for them.

An Opportunity Not to Be Missed

Within the ASNC vision, Vietnam is provided with an opportunity (not to be missed) in leading ASEAN toward the next stage of economic development. While it may want to gain specific achievements in the other areas of South China Sea issue and ASEAN’s institutional capacity, realizing these goals requires a lot of diplomacy with the other nine member states. With a little more than half year left, it is still challenging for the country to achieve these goals despite it is not an entirely impossible endeavor to start with. Pushing for short-term goals within the ASNC vision, meanwhile, will help Vietnam to get quick result and one that is also vital for the new course of ASEAN’s economic development.

ANBOUND Research Center (Malaysia) is an independent think tank situated in Kuala Lumpur, registered (1006190-U) with laws and regulations of Malaysia. The think tank also provides advisory service related to regional economic development and policy solution. For any feedback, please contact: malaysia[at]anbound.com.

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Urban Development

Bridge for Cities 2020: Mayors discuss urban development during COVID-19 crisis

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The Bridge for Cities 2020 event provided a forum for mayors and other urban stakeholders to discuss and exchange views on relevant experiences, challenges and opportunities related to the COVID-19 pandemic. The event placed particular emphasis on green, social and technological innovations which can assist cities to recover from the crisis and act as an accelerator for the Sustainable Development Goals.

Organized jointly by the United Nations Industrial Development Organization (UNIDO) and the Finance Center for South-South Cooperation (FCSSC), in close collaboration with the City of Vienna, the event attracted more than 500 attendees.

In his opening statement, UNIDO’s Director General, LI Yong, stressed that “the pandemic has forced us to think outside-the-box and identify innovative solutions. It is important for us all to work collaboratively towards an inclusive and climate-resilient recovery. Bridge for Cities aims to facilitate long-lasting city-to-city partnerships in the course of the COVID-19 crisis and beyond.”.

CAI E-Sheng, Chairman of the FCSSC, added that “in the post-pandemic era, urban development should be resilient. Resilient cities should have both the ability to deal with the crisis, and the ability to recover from the crisis.”

Discussing how digitalization can help to promote behavioral shifts in designing and imagining cities in the context of the COVID-19 crisis, Professor Carlo Ratti, Director of the MIT Senseable City Lab, highlighted that “to respond to the pandemic, cities must act fast, try new innovations, and obtain citizens feedback, as this constant feedback loop will allow the transformation of cities for the future.”

The first Mayors’ Roundtable brought together representatives from Almaty, Antananarivo, Dortmund, Manama, Shenzhen, Vienna, Zamboanga and Zhengzhou to present their cities’ response in ensuring an inclusive recovery from the crisis. The discussion focused on solutions to protect peoples’ jobs, especially those of vulnerable groups, and to support measures for MSMEs that will assist urban development in the long term.

The second Mayors’ Roundtable moved the spotlight onto the topic of a green economic recovery. Mayors and representatives from Amman, Budapest, Colombo, Damietta, Manizales, Sarajevo, Sihanoukville and Tunis offered diverse perspectives on the issue, including opportunities to decouple industrial production and urban infrastructure growth from environmental degradation by making the necessary investments now.

The event was enriched by a series of workshops and exhibition booths organized by partner cities, international organizations and innovative start-ups, showcasing ground-breaking solutions for the future of smart cities’ development.

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Rebuilding Cities to Generate 117 Million Jobs and $3 Trillion in Business Opportunity

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COVID-19 recovery packages that include infrastructure development will influence the relationship between cities, humans and nature for the next 30 to 50 years. With the built environment home to half the world’s population and making up 40% of global GDP, cities are an engine of global growth and crucial to the economic recovery.

Research shows that nature-positive solutions can help cities rebuild in a healthier and more resilient way while creating opportunities for social and economic development. The World Economic Forum’s new Future of Nature and Business Report found that following a nature-positive pathway in the urban environment can create $3 trillion in business opportunity and 117 million jobs.

“Business as usual is no longer sustainable,” said Akanksha Khatri, Head of the Nature Action Agenda at the World Economic Forum. “Biodiversity loss and the broader challenges arising from rapid urban population growth, financing gaps and climate change are signalling that how we build back can be better. The good news is, there are many examples of nature-based solutions that can benefit people and planet.”

Cities are responsible for 75% of global GHG emissions and are a leading cause of land, water and air pollution, which affect human health. Many cities are also poorly planned, lowering national GDP by as much as 5% due to negative impacts such as time loss, wasted fuel and air pollution. However, practical solutions exist that can make living spaces better for economic, human and planetary health.

The study, in collaboration with AlphaBeta, highlighted examples of projects deploying nature-positive solutions and the business opportunities they create.

Cape Town: Cape Town was just 90 days away from turning off its water taps. Natural infrastructure solutions (i.e. restoring the city’s watersheds) were found to generate annual water gains of 50 billion litres a year, equivalent to 18% of the city’s supply needs at 10% of the cost of alternative supply options, including desalination, groundwater exploration and water reuse

Singapore: Singapore’s water leakage rate of 5% is significantly lower than that of many other major cities thanks to sensors installed in potable water supply lines. Globally, reducing municipal water leakage could save $115 billion by 2030. Returns on investment in water efficiency can be above 20%.

Suzhou: Suzhou Industrial Park’s green development in China has seen its GDP increase 260-fold, partially through green development. The park accommodates 25,000 companies, of which 92 are Fortune 500 companies, and is home to 800,000 people. The park has 122 green-development policies, including stipulations on optimizing and intensifying land use, improvement of water and ecological protection, and the construction of green buildings. As a result, 94% of industrial water is reused, 100% of new construction is green, energy is dominantly renewable and green spaces cover 45% of the city.

San Francisco: San Francisco requires new buildings to have green roofs. The “green” roof market is expected to be worth $9 billion in 2020 and could grow at around 12% annually through 2030, creating an incremental annual opportunity of $15 billion.

Philippines: The loss of coastal habitats, particularly biodiverse and carbon-rich mangrove forests, has significantly increased the risk from floods and hurricanes for 300 million people living within coastal flood zones. A pilot project in the Philippines, one of the countries most vulnerable to climate change, is monetizing the value of mangroves through the creation of the Restoration Insurance Service Company (RISCO). RISCO selects sites where mangroves provide high flood reduction benefits and models that value. Insurance companies will pay an annual fee for these services, while organizations seeking to meet voluntary or regulatory climate mitigation targets will pay for blue carbon credits. Overall, restoring and protecting mangrove forests in human settlements can reduce annual flood damage to global coastal assets by over $82 billion while significantly contributing to fighting climate change.
The report identifies five complementary transitions to create nature-positive built environments and outlines the business opportunities and potential cost savings for programmes targeting urban utilities for water, electricity and waste, land planning and management, sustainable transport infrastructure and the design of buildings.

Office space the size of Switzerland
Global examples call out areas to be improved. For example, an estimated 40 billion square metres of floor space is not used at full occupancy during office hours – an area roughly equivalent to the size of Switzerland. The COVID-19 upheaval has prompted a surge in flexible and remote working models in many countries – greater application of such models could help reduce the need for private office space in the future.

Governments’ role to raise and steer finance
The report calls for both government officials and businesses to play their part in raising and steering finance for sustainable urban infrastructure. “Regulations in areas including urban master planning, zoning and mandatory building codes will be critical to unlocking the potential of net-zero, nature-positive cities and infrastructure,” said Khatri. “We are at a critical juncture for the future of humanity. Now is the time to treat the ecological emergency as just that. A net-zero, nature-positive path is the only option for our economic and planetary survival and how we choose to use COVID-19 recovery packages might be one of our last chances to get this right.”

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City Climate Finance Gap Fund Launches to Support Climate-smart Urban Development

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Today, the City Climate Finance Gap Fund (“The Gap Fund”) was launched jointly by ministers and directors of the Governments of Germany and Luxembourg together with the World Bank, European Investment Bank, and Global Covenant of Mayors. It paves the way for low-carbon, resilient, and livable cities in developing and emerging economies by unlocking infrastructure investment at scale.   

The Gap Fund will support city and local governments facing barriers to financing for climate-smart projects. Filling a gap in available project support, the Gap Fund offers technical and advisory services to assist local leaders in prioritizing and preparing climate-smart investments and programs at an early stage, with the goal of accelerating preparation, enhancing quality, and ensuring they are bankable.

With a target capitalization of at least €100 million, the Gap Fund will accelerate investments supporting cities in developing and emerging economies, as they determine goals and objectives for low-carbon and well-planned urbanization. The Gap Fund investment is aiming to unlock at least €4 billion of final investment in climate-smart projects and urban climate innovation.

“What cities do today will forever shape our climate tomorrow,” said Mari Pangestu, World Bank Managing Director for Development Policy and Partnerships. “Cities in developing countries urgently need resources to realize their climate ambitions. Through the Gap Fund, the World Bank is supporting low-carbon, resilient, inclusive, healthy, creative, and sustainable communities for all.”

Cities are on the frontlines of the climate emergency and currently account for around 70 percent of global CO2 emissions. Urban centers’ share of emissions is expected to grow as 2.5 billion people migrate from rural to urban areas by 2050. Before the COVID-19 pandemic struck, it was estimated that more than $93 trillion in sustainable infrastructure investment was needed by 2030 to meet climate goals. As cities strive to recover from the economic impacts of COVID-19, investments in clean energy, climate-resilient water and sanitation, and urban regeneration projects will play an important role in eliminating pollution, improving local food systems, and creating green jobs. They will also lead to cleaner, healthier, and more equitable communities – conditions that can help prevent future pandemics.

Climate investment projects are an indispensable opportunity to improve lives of the millions who live in cities around the world. However, cities frequently lack the capacity, finance, and support needed for the early stages of project preparation – especially in developing and emerging economies. This leads to impasses where cities cannot move project ideas to late-stage preparation and implementation. This hurdle is frequently overlooked by national and international support – a challenge the Gap Fund will seek to overcome.

The Gap Fund is an initiative of the governments of Germany and Luxembourg together with the Global Covenant of Mayors for Climate and Energy (GCOM), in partnership with several other key players in the climate finance arena (including C40, ICLEI – Local Governments for Sustainability, and Cities Climate Finance Leadership Alliance). It will be implemented by the World Bank and the European Investment Bank. The Gap Fund was announced at the UN Climate Action Summit 2019 as a key initiative of LUCI, the Leadership for Urban Climate Investment, which promotes financing for ambitious urban climate action until 2025. Core donors to the Gap Fund are Germany (€45 million – including €25 million from the Ministry for the Environment, Nature Conservation and Nuclear Safety, and €20 million from the Ministry for Economic Cooperation and Development) and Luxembourg (€10 million).

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