1. Competitive Cities: From Brown to Green Shahid Yusuf World Bank Institute World Bank, Washington, D.C. August 21, 2009 Presented at the UNESCO Future Forum: “Moving Towards a Green Economy and Green Jobs”

2. Why Competitiveness Determines Sustainability Cities need to attract industry and services in order to generate growth and employment. Competitive economic base determines elasticity of fiscal revenue and access to financing from capital markets. Competitiveness helps ensure that a city’s imports of goods and services are balanced by exports. Both Brown and Green cities must be competitive.

3. What Makes Cities Competitive? Low input costs Factor productivity Business culture and business climate Industrial composition Innovativeness

4. How Is Competitiveness Realized? Size of city and industrial diversity affects scale, agglomeration and urbanization economies. Mix of industries and services affects productivity growth, R&D intensity and patenting. Supply and quality of technical, vocational and scientific skills determines industrial diversification, technological upgrading, labor productivity and innovation. Municipal leadership, private-public partnerships and effective use of the internet/ICT improves the business climate by reducing transaction costs. Quality and technical excellence of infrastructure cuts costs and contributes to productivity.

5. Industries With The Highest Levels of R&D

6. Industries Generating The Most Patents

7. What Are the Characteristics of Competitive Cities? Location Size Concentration of manufacturing activities Presence of high quality urban innovation system Good logistics, public services and ICT infrastructure Adequate social and recreational amenities However, Brown industrial cities: Are energy and water intensive, and sprawling Are greatly dependent upon auto-mobility House industries that release large quantities of GHG and other pollutants

8. Sectoral GHG Intensity

9. What Are the Attributes of a Green City? Low energy intensity to lessen GHGs achieved through spatial compactness, limited dependence on autos, and composition of productive activities. Low water and resource intensity with the help of lean technologies and emphasis on recycling and reuse. Reliance on renewable materials and energy sources. Focus on knowledge intensive, relatively weightless activities producing high value exportable goods and services. Abundance of social and recreational amenities which can raise quality of life, but contribute little directly to urban GDP.

10. How Can Competitive Brown Industrial Cities Become Green? Main Challenges: – Renewing and greening stock of infrastructure (including energy) and housing. – Transforming physical shape of city to make it compact and more vertical, polycentric, mainly reliant on public transport and with amenities (e.g. green spaces) which sustain livability as densification increases. – Changing industrial composition to favor activities with lesser resource and GHG footprints, while not sacrificing value added and competitiveness.

11. How Can Competitive Brown Industrial Cities Become Green? Main Challenges: – Redesigning, cost effectively, products, processes, supply chains and infrastructures so as to cut energy, water and material inputs and facilitate recycling and reuse. – Switching significantly from fossil to renewable energy sources. – Creating a smart, wired urban society with a rich culture of innovation to spur economic performance.

12. What Will It Take? A change in mindsets, and visionary leadership combined with focused grassroots initiatives. Huge upfront investments which partially erase and reshape urban-industrial legacies and point cities in new directions. Raising relative prices of energy (carbon), land and water to induce conservation. Standards (e.g. ISO 14000) for ‘green compatible’ processes plus enforceable certification procedures; IP protection and technology standards to promote innovation.

13. What Will It Take? Labeling of carbon content, type of energy used (renewable or not) and use of bio based/recycled material. Data gathering plus appropriate ‘ecometrics’ for tracking the progress with greening the urban economy. A redirection and substantial increase in innovation, plus some breakthroughs in energy, materials and water technologies. Political resolve, willingness to take risks, mobilize financing and commit to long term and complex projects.

14. Green Pathways Source: Chris Yingchun Yuan, LMAS Presentation, 2009 Laboratory for Manufacturing and Sustainability © 2009

15. Are There Success Stories To Light The Way Forward? Numerous examples associated with urban transport greening, urban recreational amenities (e.g. in Curitiba, Toronto, Zurich, Freiburg and Fukuoka; and by companies such as Intel, Dell, UPS and Starbucks) and redesign of products and processes which have diminished GHG emissions. No examples as yet of urban-industrial transformations on the scale required and on the time scale that is desirable. Sustaining economic momentum of a major city while making it a “Green eco-city” remains to be achieved. Viability of custom-built eco-cities not yet established (e.g. Dongtan, Tianjin Eco-City, Huangbaiyu, and Masdar in Abu Dhabi.

16. Thank You