1. Guanghua Wan Principal Economist

2. Main Messages Asias urbanization is unprecedented & unique in several aspects … leading to enormous challenges possibly including environmental degradation But urbanization can help! To ensure a win-win scenario, green urbanization policies shall exploit unique features of Asias urbanization and late comers advantage

3. 1 billion Asias urbanization is unprecedented Source: ADB estimates using UN(2012).

4. 10% 49% 210 years 9% 51% 105 years 12% 51% 150 years 11% 51% 95 years 12% 50% 90 years 12% 54% 65 years 10% 52% 60 years 10%51% 55 years 11% 51% 61 years Unique feature 1: very fast speed Source: ADB estimates using Bairoch (2008) and UN(2012).

5. Unique feature 2: highest densities in the world… Asia & the Pacific (17/25) Africa Europe Latin America & Caribbean Middle East & North Africa Source: www.citymayors.com

6. Unique feature 3: many megacities Megacities, 2010 ASIA: 12/23 Note: The circles indicate population sizes ranging from (10 million) to (39 million). The circles do not reflect the physical extents of the cities and any overlap between them merely reflects their relative population sizes and not any official acceptance or endorsement of any geographical sovereignty. Source: UN (2012).

7. Unique feature 4: low starting base 52% 43% 67% 63% Northern America Europe Latin America & Caribbean WORLD ASIA & PACIFIC Africa Source: ADB estimates using Bairoch (2008) and UN(2012).

8. Ratio of Population in Largest Cities over Urban Population (%) Unique feature 5: the largest cities are likely to grow bigger Source: ADB estimates using UN(2012).

9. … thus more and bigger megacities are emerging Megacities, 2025 ASIA: 21/37 Note: The circles indicate population sizes ranging from (10 million) to (39 million). The circles do not reflect the physical extents of the cities and any overlap between them merely reflects their relative population sizes and not any official acceptance or endorsement of any geographical sovereignty. Source: UN (2012).

10. Unprecedented urbanization poses enormous challenges already serious Growing inequalities Rising urban crimes Expansion of slums Above all, environmental degradation Pollution Vulnerability to flooding

11. 67% of Asian (vs. 11% Non-Asian) cities fail to meet EU air quality standard EU standard Source: WHO (2012).

12. CO 2 emissions grow fast in Asia Source: ADB estimates using World Bank (2012).

13. … and three of the top five CO 2 emitting economies are in Asia.

14. Environment may degrade further with growth Asias Environmental Kuznets Curve 2010=$6,107Peak=$40,971 Source: ADB estimates using World Bank (2012).

15. CO 2 emissions may triple under the business-as-usual scenario Source: ADB estimates using World Bank (2012).

16. Asia is more vulnerable to coastal flooding Urban population at Risk (million) Share of Population at Risk (%) Urban Area at Risk ('000 km 2 ) Share of Area at Risk (%) Africa3211186 Asia and Pacific2511812911 Latin America248426 Europe407567 Risk of Coastal Flooding by Region, 2000 Source: ADB estimates based on McGranahan et al. 2007.

17. Coastal flooding is clustered in PRC, South & Southeast Asia: Top 15 cities, 2000 CountryCity Population at risk (%) Population at risk ('000) City Area at risk (km 2 ) Area at risk (%) PRCTianjin100.0 5,500 2081100.0 PRCPanjin100.0 1,000 690100.0 BangladeshKhulna99.9 1,100 39499.8 PRCNantong99.8 1,000 28699.9 PRCChangzhou99.0 2,000 36299.0 PRCJiangyin96.8 1,200 49296.8 PRCSuzhou95.8 1,300 36891.2 IndonesiaPalembang94.2 1,300 47389.5 ThailandBangkok93.3 8,800 480580.2 PRCWuxi91.1 1,300 39791.0 PRCShanghai90.8 14,000 241698.2 IndiaKolkata89.0 14,000 144162.9 PRCNingbo85.6 1,700 77985.6 IndonesiaUjung Pandang85.4 1,200 29568.7 Viet NamHo Chi Minh79.3 4,400 89072.6 Source: Balk and Montgomery (2012).

18. Inland flooding is also serious: Top 15 cities, 2000 CountryCity Population at risk (%) Population at risk ('000) City Area at risk (km 2 ) Area at risk (%) CambodiaPhnom Penh99.098820499.0 PRCWuhan82.0530095682.0 IndonesiaPalembang80.0110025749.0 IndiaPatna72.0110043672.0 BangladeshDhaka60.0540068048.0 PRCNanjing56.0220074956.0 VietnamHo Chi Minh50.0280030625.0 PRCTianjin50.0280079538.0 PRCHuangshi50.062417045.0 PRCHuainan50.061427749.0 PRCWuhu47.055214048.0 ThailandBangkok46.04400216536.0 PRCBangbu44.051019844.0 IndiaGuwahati44.050715935.0 IndiaAllahabad42.066523043.0 Source: Balk and Montgomery (2012).

19. Vulnerability will rise with urbanization Source: Balk and Montgomery (2012).

20. Unique features of Asian urbanization make challenges more serious... Low level = a long way to go Fast speed = little time to adjust or learn More & bigger megacities = hard to manage More slums = higher vulnerability

21. But, urban agglomeration can help Service sector pollutes less Manufacturers relocate Efficient provision of infrastructure and services Better quality of life Innovation and higher labor productivity Nurture property owners and middle clss And...

22. Urbanization leads to lower fertility

23. … and more human capital

24. … better health as well Source: UN (2011) and (2012).

25. The growth/composition/technical impacts of urbanization on environment The growth impact may be negative The composition effect is positive Technical effect is also positive Most importantly, Asia as a late comer can leapfrog R&D and technology … and for adopting regulations timely

26. Environment-Urbanization relation has improved over time 1990s 2000s 1990s 2000s CO 2 PM 10 Environment-Urbanization Curves Source: ADB estimates.

27. Green urbanization can help shift the curves further Unique patterns of urbanization lead to megacities with satellite cities: ToD, BRT, green/compact/eco- cities concepts Exploit late comer advantage: import or R&D, smart grid, circular economy, clean energy, …. Timely introduction of regulations, and better financing and transparency: pollution/emission pricing, carbon tax or cap & trade, reduce subsidies, increased block tariffs, …

28. Policy implementations Fiscal transfer conditional on local performances Enhance access of local governments to capital markets Info disclosure such as report cards on greenness National competition to ensure race to top

29. Conclusions It is counter-productive to contain urbanization, even for environmental concerns But, urbanization must be steered into a green path that exploits own unique features Asia can achieve green urbanization!

30. Thank You www.adb.org