Keshav VarmaDirector, East Asia & Pacific Urban Sector

The World Bank

Cities of OpportunitiesThoughts on Asian Cities in the 21st Century

Globalization, Urbanization and Decentralization

• Globalization

• Intense pace of Urbanization

• Devolution to local government

• Empowerment of people in democratic choice-making

1960

2025

2000

1980

0

25

50

75

100

SSA SA MENA LAC OECD EAP

East Asia Pacific Urbanizing Rapidly

Urban population (% total population) Growth in # of cities over one million inhabitants

500 million more people move into Asian cities

0

20

40

60

80

100

120

140

160

180

2000 2005 2010 2015

…with 500 million People Moving into Cities over the next 20 years

Source: World Development Indicators, 2004; United Nations World Urbanization Prospects, 2003

Source: United Nations World Urbanization Prospects, 2003

Changing Governance - Increasing Decentralization

Expenditure decentralization – sub-national expenditure

(% total national expenditure)

0 10 20 30 40 50 60 70

Germany (1990s)

USA (1990s)

Japan (1990s)

OECD countries (1990s)

Pakistan (1990s)

Russia (1990s)

India (1990s)

Thailand (2001)

Philippines (2002)

Indonesia (2002)

Vietnam (2002)

China (2002)

All transition countries (1990s)

All developing countries (1990s)

Source: East Asia Decentralizes—Making Local Government Work, The World Bank

Shifting Importance of Cities – Local and Global

• Half the world’s population will be in cities by 2010 – and half of them will be poor

• Urban leaders are playing important roles in the national arena

• Cities are the locus of growth, jobs & wealth

• Cities – regions as fundamental spatial units for global economy

Challenges of Urban Management

• Population pressures – poverty & slums

• Urban infrastructure service provision

• Water & sanitation

• Solid waste management

• Transport & traffic management

• Unacceptably low levels of investment in basic infrastructure

• (In)efficiency of investments

0

20

40

60

80

100

120

140

160

180

1996-2000 2001-2005 2006-2010 by sector by country by economicclassif ication

* Based on econometric simulations consistent with projected regional growth, and efficiency prices. Due to data limitations, the simulation excludes a number of key infrastructure services, notably ports and airports, and all but major roads

East Asia’s Increasing Infrastructure Needs

East Asia, estimated infrastructure expenditure, actual and projected, 1996 – 2010 ($ billion / year )

$123 bil

$147 bil $165* bil

electricity

roads

telecoms

water and sanitation

rail

China

all, excluding China

Investment

Maintenance

Source: JBIC/ ADB/ Worldbank Flagship Study: Connecting East Asia

Challenges of Urban Management (Contd…)

• Urbanization of Poverty• Urban poverty and growing affluence

• Urban slums, land markets and shelter

• Shape of cities – expected significant increase in build-up areas

• Antiquated laws and insufficient frameworks

• Small solutions to challenges of urban management – enormous problems upscaling

Slums – Growing Numbers & Unequal Access to Services

Piped water connection*

Sanitation Electricity TelephoneAccess to Water**

Citywide 65.9 58 94.4 57.1 94.8

informal settlements 38.3 7.4 75.7 25.4 89.1

Citywide 75.8 64 86.5 52.1 88.9

informal settlements 37.2 19.8 59.1 25.4 57.6

East Asia

All developing countries

Slum population (% of Urban Population), 2001

72

38

23

66

24

65

2

47

34 3228

72

58

3343

01020304050607080

• Unequal Access to Basic Services

• The Growth of Slums

Source: JBIC/ ADB/ Worldbank Flagship Study: Connecting East Asia

Source: World Development Indicators

Urban Shape—Large Increase in Build Up Areas

Source: Prof. Shlomo Angel, Dynamics of Global Urban Expansion

Inside City Halls – Good Governance

• Sustainable Governance as a long-term goal

• Professionalism, and citizen friendly city-employees

• Transparency & accountability

• Continuous capacity building and training

• Use of private sector advisors and contractors

Inside City Halls (Contd…)

• Update urban systems, legislation and laws

• Raise civic awareness & respect for city laws

• Enforce transparency & accountability

• Welcome press and criticism

Livability

• City and land use planning

• Improved use of green spaces and urban agriculture

• Optimization of present assets of utilities

• Energy conservation

• Urban water and sanitation, solid waste management

• Reduction of the ecological footprints of cities

Competitiveness

• Globalization and global city regions – the need to enhance competitiveness

• Excellence and quality of human resources; attracting talent • Examples of Bangalore in India and its connection to the Silicon Valley

• Cultural heritage and urban renewal

• Competitiveness on multiple dimensions

Bankability

• Scarcity of resources – per capita investment in infrastructure unacceptably low

• Credit rate cities

• Access to capital markets – municipal bonds

• Bankability and Bonds – seen as an aspect of civil pride, empowerment and partnership

Solutions Revisited

• Exceptional leadership – visionary, creative, firm, responsive and compassionate

• New paradigm for city management and governance

• Foster true citizenship – bring people into the business of city management

• Concentrate on building sustainable institutions

• Build morale and external alliance

• Include the poor