Does the path to city growth go through smart infrastructure?
For the first time, more than half (54%) of the world’s population lives in cities and by 2050, the United Nations predicts that figure will reach 66%. There is a clear trend for cities to gradually take on ever-greater importance. They have become the world’s dominant demographic and economic groupings as well as our most enduring and stable social structures.
The populations of the greater Mexico City region, or Shanghai for example, are larger than that of Australia. China’s urban Chongqing region is an area the size of Austria. The megacities of the future will be larger than many of the nations we know today.
So what steps do UK cities need to take to ensure they remain competitive?
As the competition for foreign capital investment into cities grows, success is no longer purely about size. Other aspects such as innovation and an ability to transform and adapt to a changing socio-economic landscape, are becoming increasingly important. The UK needs cities to meet people’s needs – now and into the future – to drive economic growth locally and nationally.
Collaboration across cities through initiatives like the Northern Powerhouse and the Midlands Engine will be key. Scotland, for example, has a programme of seven cities focused on developing their “smart” capabilities. Each one is interlinked, with the “Eighth City” being an amalgamation of the other seven. They all have a clear focus on a particular technology or development and the knowledge is then shared across all of the cities.
Infrastructure has a key role to play and it is the reason why the UK Government is focused on programmes within what I like to call, “the six H’s” – High Speed 2, Hinkley Point, Heathrow, Highways, housing and heritage. Infrastructure investment makes doing business easier and more attractive to foreign investment. The 2016 EY UK Attractiveness Survey noted that digital skills, roads and London airports are crucial to economic competitiveness. With business rates now feeding directly into the local economy, this will mean more money for social infrastructure, which in turn will facilitate house building and ultimately city growth.
Infrastructure and the development of our future cities are intrinsically linked. Both are necessary for UK economic stability, security and growth. The challenges city leaders face around funding and financing, coupled with finite resources, means projects need to be prioritised and benefits enhanced.
There are three key essentials to success: Firstly, focusing projects around the different physical and social infrastructure elements of a city and understanding how they are connected so that benefits can be maximised. Secondly, businesses and residents, as the “users” of the city need to be involved and engaged and infrastructure should be addressing their needs and demands. Finally, innovation should be embraced. Consider the opportunities provided by digital technology and how new commercial models can be used to drive innovation and entrepreneurism.
And in the post-Brexit era, getting the UK’s cities working together and sharing innovation, knowledge, technologies and data is more important more than ever.
- Amanda Clack is head of infrastructure advisory at EY