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Background to the discussion forum topics: Asia’s Urban Development Context

Asia’s urban population is growing faster than ever before. There will be over 1.1 billion more Asian urban residents in 2030 than there were in 2005-an average increase of 44 million people every year. Asian megacities have populations and economies as large as some countries. They are magnets for people, functions, businesses, and organizations. As they expand into their hinterlands, they bring both the benefits and the problems of urbanization. The management challenges they generate are enormous and affect all facets of life: the economy, the environment, and society.

Some Asian megacities are merging into mega-regions, urban settlements on a scale never before seen. For example, by 2010 the population of the Hong Kong, China-Shenzen-Guangdong mega-region could reach 120 million. Because they span many administrative boundaries, these regional urban systems raise the need for complex coordination of water, transport, and communications infrastructure. The scope, range, and complexity of these issues and others that mega-regions face were previously associated only with national states.

Rapid urbanization has been the key driver of Asia’s dynamic growth-and of the poverty reduction that has resulted. East Asia’s urban population produces 92% of its wealth, with Southeast Asia not very far behind at 77%, and South Asia at 75%. This means that the efficiency with which its cities are managed can determine how fast a country’s economy grows. Large cities are more productive than smaller ones and labor productivity generally increases with city size. With the greater integration of global production systems, there has been progressive concentration, specialization, and integration of production and capital flows in cities or city regions that offer competitive advantage to investors, buyers, transnational corporations, and other producers of wealth.

Cities occupy only 2% of the world’s land but consume 75% of its resources. They produce a similar percentage of its waste. An ecologically sustainable footprint is thought to be 1.8 hectares per person. The average footprint in the People’s Republic of China (PRC) is 1.6, despite its huge population. But Shanghai’s is already 7.0 and is fast approaching that of a typical American city-9.7. Cities are also major contributors to climate change. They consume most of the electricity and fuel used by transport, industry, and households for domestic heating and cooking, as well as most of the energy used in construction of buildings, infrastructure, and other fixed assets. Cities produce close to 80% of all carbon dioxide and other greenhouse gases (GHGs). Almost 80% of carbon emissions from fossil fuels and cement manufacturing arise from energy and building activity in cities, and 76% of industrial wood used worldwide ends up in urban areas. Asian cities are likely to contribute more than half the rise in GHGs over the next 20 years. Cities are also highly vulnerable to the consequences of climate change, including flooding, landslides, heat waves, and shortages of water. The potential indirect impacts of climate change on cities range from increased energy demands for heating or cooling to large in-migration of environmental refugees and food shortages.

Between 240 million and 260 million people in Asia’s urban areas live on less than $1 a day. That is about one third of the total number of absolute poor in Asia, which in turn accounts for about 70% of dire poverty the world over. Many of Asia’s urban poor live under high density conditions in degraded, informal, or squatter settlements located in both built-up districts and peri-urban areas on the edge of cities. Projections are that, if nothing changes, the population of these slums will grow by an average 110 million people a year, reaching 692 million by 2015. This could further accentuate the large gaps between the rich and the poor that are characteristic of urban areas in both developed and developing-cities. The urban poor are more vulnerable to shocks .than their counterparts in the countryside because there is no nearby farm to provide food. Traditional family support, common in rural areas, is generally absent. The poor are further handicapped in cities by lack of access to health care, education and training, as well as to productive assets and social networks. Their fragile asset base is a key factor in their relative inability to withstand risks and improve livelihoods. Housing-including security of tenure-is one of the most important elements in a family’s asset base.

Under the framework of provision of urban investment infrastructure, the topics for discussion are initially selected from the MAC Report as a means to stimulate discussion and debate among professionals and other practitioners working in and with Asian cities and does not necessarily represent the views or position of the CDIA Programme. The Discussion Forum has been initially organized into two clusters (1) the three dimensions of sustainable development – economic, environment and social and (2) organizational & institutional aspects to implement change – coordination, finance and capacity development. Over time, the range of topics and sub-topics will be further expanded. We welcome you to share your views, comments and experience on these topics.

These cities suffer from inadequate institutions and infrastructure. Institutional weakness and poor and insufficient infrastructure put the future growth of Asia’s cities in danger. Crucial areas of urban management-planning, environmental management, and financial management-lack capacity, and the structures, institutions, and incentives to acquire skills and expand these capabilities cannot meet the need. Economic and environmental infrastructure is already inadequate in Asian cities, and now growing demand is greatly outstripping growth in supply. Traffic jams and pollution reduce the efficiency of economic activity in cities and lower worker productivity. Inadequate infrastructure is among the most serious threats to sustaining the development of Asian cities in the future. Link to Part I Chapter 1: Asia’s Urban Challenge