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1.1 Global Urbanization Context
Urbanization is a well-known phenomenon that has become an integral part of our
modern culture. The role of cities and their prominence in the global economy is now
at the center of contemporary dialogues, both nationally and internationally. Credible
institutions like McKinsey are predicting that 65 percent of the future growth in
global productivity will come from the top 600 cities, generating 30 trillion
of new wealth for the world by 2025.
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The top 25 of these cities are mega cities
with over 10 million in population. A majority, over 400, are
mid-size cities with a population between 200,000 to 10 million spread out
across 57 countries. Of the top 600, 440 of the cities—the so-called
Emerging 440—are also from the developing world, with over
60 percent from China. Their growth would
be organic in nature, largely propelled by the inevitable rural to urban migration
inherent in the development process. It is estimated they would be responsible for
47 percent of future growth, generating
23 trillion in new global wealth by 2025. With rapid and highly concentrated growth,
these 600 cities will undoubtedly face many diicult challenges in the foreseeable
future. For the top 25 mega cities, the risk of
hyper-urbanization and resulting urban blight is always around the corner. They need
to be sensitive to when the marginal cost of growth outweighs the marginal beneit. For
the rest, opportunities abound, but they come with diferent challenges for diferent cities.
In developing countries, with organic growth and latent consumerism on their side, cities
need to become much smarter to get better access to the global marketplace.
In advanced economies, as organic growth slows inevitably and the demographics
become more challenging, cities need to compete harder to maintain their economic
and political legitimacy—often without much success as we saw in Detroit and
other cities that had to resort to bankruptcy in recent years. For all, however, foremost
on their agenda should be the need to balance rapid growth that is economically
driven with sustainable and inclusive development plans that are ecologically
sound and that ensure social equity for all citizens, including the urban poor.
1.2 Key Urban Infrastructure Challenges
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