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World Cities Summit Issue, Jun 2008
Human Development
and Urbanisation
Richard Leete
CITIES AS CENTRES OF ECONOMIC AND POPULATION GROWTH
No country in the modern era has achieved significant economic growth without urbanisation. Southeast Asian cities are playing an ever-increasing role in creating wealth, attracting investment, enhancing social development, and harnessing both human and technical resources for achieving gains in productivity and competitiveness. Urban settlements tend to account for a larger share of national income, outpacing national economic growth. For example, Bangkok, which comprises just over 10% of the total population of Thailand, accounts for more than 40% of the country’s gross domestic product.6
Cities are key to globalisation, a state of interconnectedness around the globe that transcends and, for many purposes, largely ignores national boundaries. The shrinking of the globe through the continuing technological revolution makes it possible for business enterprises to utilise services from anywhere in the world. Global urban economies rely on advanced knowledge-based services, such as finance, insurance, management consultancy, education, media and advertising.
The cities of Southeast Asia are increasingly providing customer services at competitive rates by drawing on a large and increasingly more educated and relatively low-cost labour force. Three notable examples of hubs of global activity for specialised services in Southeast Asia are Singapore, which has a major role as an international finance centre, and as sea and air transport hubs; Bangkok, which hosts many regional headquarters for corporations and international agencies; and Kuala Lumpur, which has a multimedia super-corridor, with Cyberjaya and Technology Park Malaysia forming its nuclei.
Huge, sprawling conurbations—megacities and metacities (cities with more than 20 million inhabitants)—have changed the dynamics of urbanisation and the urban economy. People active in both the formal and informal sectors commute long distances to work, to and from densely populated outlying towns or suburbs. In cities such as Jakarta, Bangkok and Manila, and even in the craft and industry villages in Vietnam’s Red River Delta, the economic base spreads outwards along urban corridors to peri-urban localities that are cheaper and less strictly regulated. Secondary cities and city systems, often located along these corridors, become interconnected through manufacture and ancillary business enterprises.7
Despite the prominence given to large cities, more than 53% of the world’s urban population lives in cities of fewer than 500,000 inhabitants, and 60% in cities of less than 1 million.5 It is these relatively small cities that will absorb the bulk of urban population growth in the foreseeable future. The relatively smaller cities are gaining ever more prominence, especially those in the Philippines and Indonesia.
Infrastructure investments in urban areas can be cost-effective. The concentration of population and enterprises in urban areas greatly reduces the unit cost of piped water, sewers, drains, roads, electricity, garbage collection, transport, healthcare and schools. However, the cost-effectiveness of such investments is reduced when they are made too late. For instance, when informal settlements or slums are allowed to proliferate, it becomes more difficult and more expensive to install infrastructure and services because no prior provision has been made for the settlement’s development. Moreover, population densities and the spatial configuration of slums often do not allow for the subsequent development of roads, sewerage systems and other facilities that are easy to install in less dense and better-planned localities.
INCREASED HUMAN DEVELOPMENT AMONG CITY POPULATIONS
The concept of cities as islands of privilege and opportunity is supported by indicators on health, education and income, which generally reflect better outcomes in urban areas as compared with rural areas. However, with increased globalisation, the urban transition is widening gaps between social groups and is making inequality more visible. Large cities generate creativity and solidarity, but also make conflicts more acute.
Severe inequalities within cities are exacerbated by political and social exclusion. One reality of a rapidly urbanising world is the rise in relative poverty in cities brought about by large differentials in income and consumption between the haves and the have-nots. National statistics tend to underestimate levels of urban poverty, which is often relative rather than absolute. Moreover, the measurement of poverty in both rural and urban areas is generally based on income, which does not necessarily provide an accurate picture of the scale and multidimensional nature of poverty. One view is that urban poverty is a transient phenomenon of rural-to-urban migration and will disappear as cities develop, thus absorbing the poor into the mainstream of urban society. This view is reflected in most national poverty reduction strategies, which tend to be rural-focused with the result that interventions have had limited effect in reducing relative poverty, exclusion and inequality in cities.
UN-Habitat’s State of the World’s Cities 2006/7 Report6 notes that it is generally assumed that urban populations are healthier, more literate, and more prosperous than rural populations, but in fact the urban poor suffer from ‘an urban penalty’: urban slum dwellers in developing countries are as badly off, if not worse off than their rural relatives.8 Some slums are much worse than others.
However, slums in Southeast Asian cities are less deprived, with only 26% of the slum populations living in conditions of extreme shelter deprivation.6 Indeed, the proportion of slum dwellers in Southeast Asian cities has itself declined in recent years.
For example, Thailand has not only managed to reduce slum growth in the last 15 years but has made considerable investment in improving its slums through specific upgrading and prevention policies. The Philippines and Indonesia have managed to prevent slum formation by anticipating and planning for growing urban populations. They have done this by expanding economic and employment opportunities for the urban poor, investing in low-cost, affordable housing for the most vulnerable groups, and instituting pro-poor reforms and policies that have had a positive impact on low-income people’s access to services. Similarly, in Bandar Seri Begawan, Brunei Darussalam, most houses have access to piped water and electricity supplied by public utilities.
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