APAC vulnerable to risks of rapid urbanisation

Failure to plan for rapid urbanisation in APAC cities has been flagged by the region’s experts in the World Economic Forum’s (WEF) Global Risks Report 2015, in association with Zurich.

Between 2010 and 2050, the urban population in Papau New Guinea, the Philippines, Cambodia, Vietnam and Laos is expected to double or more (but less than fivefold). The rest of the region’s urban population will increase but less than double, according to WEF.

In its report WEF stated: “Rapid urbanisation can alter the nature of almost every global risk considered in this report by influencing its likelihood and impact.

“In addition, cities are points of convergence of many risks, which make them particularly vulnerable to chain reactions and amplify the interconnection between global risks.”

The report is based on the WEF Global Risk Perception survey of its global multistakeholder community, comprising almost 900 experts or decision makers. Respondents were asked to identify three global risks that their region is least prepared for. The failure of urban planning was the risk most selected by respondents in the South Asia region and second most by respondents from the East Asia and Pacific region.

WEF expects the percentage of Asia’s population living in urban areas to rise to 64% from its current proportion of 48% by 2050 – the joint fastest rate of urbanisation anywhere in the world with Africa.

Although there are many benefits associated with urbanisation that the report highlights, such as enabling economies of scale, greater employment opportunities and breeding innovation, the failure to plan for a sharp population incline in urban areas increases the potential severity of existing risks.

The report states: “One of the main factors driving rapid urbanisation in emerging economies is rural-urban migration motivated by the prospect of greater employment opportunities and the hope of a better life in cities. Indeed, when a certain critical mass of population is reached, it is economically viable to deliver many infrastructure projects, such as public transportation.

“However, a higher population density also creates negative externalities, especially when urbanisation is rapid, poorly planned and occurs in a context of widespread poverty.

“Estimates suggest that 40% of the world’s urban expansion is taking place in slums, exacerbating socioeconomic disparities and creating unsanitary conditions that facilitate the spread of disease.

“The example of the 1994 outbreak of pneumonic plague in the Indian city of Surat suggests how, in a worst-case scenario, poverty and a pandemic in a large-scale informal settlement could lead to a breakdown in urban order.”

WEF’s report identifies health, infrastructure and social instability as key areas that growing cities must address to mitigate the risks of rapid urbanisation. However, governments of rapidly growing cities have little time for adjustment and learning. This often leads to inadequate planning and ineffective governance, which, in turn, can bring “significant economic, social and environmental costs, threatening the sustainability of urban development.”

Urbanisation is a global phenomenon but the speed of the process in developing cities is arguably compromising sustainability, resilience and strategic planning.

WEF reports that by 2050, more than 60% of the global population will live in cities, coming from less than 30% in 2000. Many observers and organisations, such as the 100 Resilient Cities (100RC) project, aim to support this transition of the world’s population from a rural existence to an urban one.

At the Rockefeller Foundation’s Urban Resilience summit at the start of December, the 100RC added a further 35 cities to its initial 32; including Sydney, Bangkok, Semarang, Mandalay, Wellington, Toyama, Hunagshi, Deyang and Singapore.

The selected cities appoint a chief resilience officer, whose salary is funded by the Rockefeller Foundation, and are given the opportunity to work with risk and insurance partners that can help improve the city’s resilience to all types of risk.

Initiatives such as 100RC could be important to mitigating the risks of APAC’s rapid urbanisation, according to WEF: “The strength of city-level institutions in addition to national institutions – their capacity to be flexible, innovative and dynamic, and effectively involve multiple stakeholders in governance – will largely determine whether urbanisation makes the world more resilient or more vulnerable in the face of global risks.”