02 Jul 2015
I want to thank the hosts of this event, Juan Costa Climent and my friend and colleague Rebeca Grynspan for inviting me to participate. My thanks also to our moderator Alejandro Álvarez von Gustedt for giving me the opportunity to make these brief keynote remarks.
Ladies and Gentlemen:
This session today looks into the future, and considers how our collective destiny will be influenced by one of the most transformative trends we are seeing in the development arena – the growth of cities and the urbanization of human society.
We have reached a great tipping-point this past decade, when for the first time in history more people lived in cities than in rural areas. By 2050 as much as 75 percent of humanity will be urban. What implications will that have for our societies? How should businesses, governments and development actors rethink their strategies to account for this transformation?
In this session we are discussing the creation of smart cities. A lot of the discourse around smart cities focuses on the role of smart IT systems and sustainable infrastructure. Information networks and modern technology have huge potential to make cities better places to live. In our work in UNDP we are already seeing many places where such innovations have solved key problems.
Just last month in Nepal, UNDP partnered with the Microsoft Innovations Centre on a smartphone-based app to plan and track recovery and rebuilding efforts in towns and cities affected by the recent earthquakes. This speeds up the recovery work, reduces errors and ensures that the people doing the work get paid quickly and efficiently.
In the Maldives we teamed up with FixMyStreet.com to develop an online platform called Make My Island, for Maldivians on remote islands to interact with their municipal councils. This has helped bring more effective municipal services to some of the most remote atolls in the country.
We’ve also seen how initiatives like PetaJakarta in Indonesia can help city residents share information, crowdsource data on floods and traffic jams and respond collectively to Jakarta’s challenges. And how smart city visions like the Sustainable Singapore Blueprint are transforming existing cities into vibrant and exciting places to live.
What makes a city smart
But are smart cities simply the sum of innovations like this? What makes a city ‘smart’? I would suggest that a city can be ‘smart’ only if it is sustainable. This means it must meet the present and future needs of our societies and economies, within the constraints of our planetary boundaries. Furthemore, I would assert that few, if any, of our existing cities are truly ‘smart’ by this measure. That is why we need a transformational change in the way cities are envisioned, built and run.
So how do we make cities smarter? Technology, infrastructure and good municipal systems are all important. But a city is not the sum of its physical assets. A city is the sum of its people, and the energy, enterprise, innovations and productivity that their interactions generate.
A smart city is one which attracts people and investment, generates business and ideas, and gives its citizens fulfilling and productive lives. Cities like these hold the potential to generate the new industries, green technologies and decent jobs the world needs to sustain inclusive growth and development.
Role of the business sector – call to action
What role will the business sector play in this vision? We look to businesses to build markets, make profits and mitigate risks. That is what businesses do best. Smart and progressive businesses will come up with the technological solutions and business models needed to make cities productive and sustainable.
The world needs a generational leap in the efficiency of energy generation and distribution, in sustainable and affordable transportation, and in healthcare, education and employment opportunities that meet the needs of our growing population. These challenges can only be overcome by the business sector.
UNDP and Developing Country Urbanization
In UNDP we focus on helping developing countries achieve sustainable human development. And many of the greatest challenges – and opportunities – in the growth of cities will take place in developing countries. As you know the world is urbanizing at a fast pace. And as much as 90% of the urban growth between now and 2050 is expected to take place in the developing regions of Asia and Africa, particularly in secondary and tertiary cities.
Providing the housing, transportation, commercial and energy infrastructure for these cities will be one of the biggest commercial opportunities in coming decades. Trillions of dollars’ worth of infrastructure investments will be required, and new financing platforms such as the Asian Infrastructure Investment Bank (AIIB) and the New Development Bank (BRICs Bank) are being set up to underwrite part of this cost. Many billions more will be mobilized by Governments and the financial sector.
Providing sustainable, cost-effective and efficient infrastructure solutions for these growing cities is a tremendous opportunity for businesses. But in the smart cities of the future, businesses will no longer be able to do this by focusing only on what happens within their office walls or on their factory floors.
The sustainability and prosperity of the cities within which companies operate will be an integral component of their business equation in future. Businesses can no longer expect national and municipal governments to solve all the social and developmental challenges in their operating environment, while businesses focus solely on the short-term bottom line. So in the smart cities of the future, smart business will recognize their shared stake in the dignity, prosperity and happiness of the citizens they live and work among.
UNDP is working in developing nation cities across the world to establish the platforms and processes by which sustainable urban solutions can be identified. We work across the spectrum of urban challenges, from sustainable transport and energy efficiency to effective local governance, safer cities, urban poverty and inclusion, and climate risk resilience and disaster reduction. All these investments are targeted to help place these fast-growing cities on the right path to a sustainable future.
SDGs and Habitat III
Over the coming eighteen months, the global community will be coming together in two major events that will shape how cities and global society develop in the decades to come. In September this year, global leaders will meet in New York to agree on a new development agenda for the Post-2015 period.
This will include a set of Sustainable Development Goals that all nations – and many cities- are expected to adopt. These Goals frame a global aspiration for the future of humanity, building on the success of the Millennium Development Goals. The new Goals will require an integrated approach to sustainable development and collective action to address the challenges of our time. They display more ambition in terms of gender equality, sustainable economies, human rights and democratic governance. They aim to put people at the centre and protect our one and only planet. And they encapsulate our duty to end poverty, leave no one behind and build lives of dignity for all.
Governments and the international community cannot build such an agenda working alone. We need the participation of all people, working together as one civil society. We need the input of science and academia. And we need the innovativeness and dynamism of the business sector.
Focusing back on cities, in October 2016 the global community will convene in Quito for Habitat III, which will agree on a New Urban Agenda for the coming decades. This global event recognizes the central role cities play in our world, and the even greater role they are expected to play in the future. UNDP is working with UN-Habitat, our sister UN agencies and the host Government of Ecuador to ensure that the New Urban Agenda reflects the voices and aspirations of all players in the city landscape, including the marginalized and disenfranchised.
Businesses and the social license to operate
Progressive businesses recognize that the ability to operate in our societies is a privilege and not a right. To earn and maintain that ‘license to operate’, companies need to actively support the prosperity and sustainability of the communities they operate within. Those of you from the business community here know this well, and demonstrate your commitment by your presence here.
We believe that in years to come, the role, reputation and social capital of businesses will depend in part on how they support broader social goals such as the SDGs and the New Urban Agenda. What role can the private sector play in helping to achieve these goals? How can the dynamism and innovativeness of the private sector unlock solutions to the many development challenges we face, particularly in cities? And how can we best work together to define a vision for cities that is truly smart: sustainable, inclusive and properous for all.
These are the questions that we in UNDP are reflecting on, and I look forward to discussing how we can work together on solutions for the years to come.