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Digital Transformation

Catch us if you can

It’s estimated that as much as 75% of the infrastructure needed to support the growth in global urbanisation has yet to be built. So can fast-sprouting cities in Africa and Asia take advantage of technological innovation to leapfrog over their developed counterparts?

Gregory Scruggs
27 November 2019

The cinematic adaptation of Marvel Comics' Black Panther was a box office smash. Among its fervent fans? Urbanists. The glimpses they saw of Birnin Zana (Golden City), the capital of the movie's Afrofuturistic utopian nation Wakanda, were a fantasy vision of 21st-century city planning come to life. High-rise density with loose zoning allows for a mix of architectural styles and self-built housing modifications. Grade-separated rapid transit and self-driving vehicles zoom through the air with nary a private car to be seen. The bustling but verdant capital, meanwhile, is surrounded not by suburban sprawl, but by agricultural villages and preserved natural landscapes.

For Aimee Gauthier, chief knowledge officer at global thinktank the Institute for Transportation & Development Policy, Wakanda illustrates an idealised form of so-called leapfrogging: how cities in the developing world can skip over stages of infrastructure development – some of them not necessarily desirable – that characterise the legacy cities of the developed world.

"Since World War II, cities have been designed around the car. What's next, what's post-car?" she asks. "Wakanda is a reference point for a city based on walking and transit. Leapfrogging over car ownership is the goal, and Wakanda shows us multimodalism facilitated through technology."

Answering "what's next?" is a crucial question given the predicted increase in the planet's urban population from 55% in 2018 to 68% by 2050, mostly in Africa and Asia. According to a 2014 report by Global Infrastructure Basel, 75% of the urban infrastructure needed to accommodate these new city dwellers has not yet been built. But how much of what is needed can leapfrog over today's developed cities? Experts in different sectors of urban development see the potential for leapfrogging, especially in certain institutional arrangements, but caution there are key fundamentals that no city can afford to ignore.

If a comic-book-turned-film version of urbanism seems too fanciful, Gauthier puts a scene from Black Panther side by side with a photograph of Dar es Salaam, Tanzania. In the former, a streetcar powered by vibranium, the fictitious metal that fuels Wakanda's economy, mixes with pedestrian traffic and shopfronts. In the latter, Africa's first gold-standard bus rapid transit (BRT) line, opened in 2016, runs through a transit-and-pedestrian mall in a not-dissimilar scene in downtown Dar. Although this BRT line only accounts for a fraction of commuters in the Tanzanian capital, Gauthier sees it as evidence of the potential for fast-growing cities in the Global South to surpass some of the developed world's mistakes.

Waterside africa
Upwardly mobile African and Asian cities have the potential to leapfrog their more-developed counterparts. Marvel Comics' film Black Panther offered a fantasy vision of a futuristic African utopia - can this be facilitated?

Upwardly mobile

Arguably the best example of leapfrogging also comes from Africa. Landline phones, which have gradually given way to mobiles in the developed world, simply never took hold on the continent. A 2015 Pew Research Center report, Cell Phones in Africa: Communication Lifeline, found landline penetration near zero, while mobile phone ownership ranged from a low of 65% in Uganda to 89% in South Africa, a rate on a par with the US and not far off the UK's 95%.

Mobiles, in turn, have assumed an even more central role in daily life. Services such as M-Pesa, Kenya's pioneering mobile payment system that can send and receive money with simple SMS technology, have come to replace traditional bank accounts.

Could this kind of technological leapfrogging have implications for the built environment? Antton Nordberg, co-founder of Singapore-based real estate technology platform Talox, certainly thinks so. "The nature of the problem in Asia is more ripe for mobile solutions than in the West," he says. "In Asia, you have a few billion people who don't have access to traditional banking services. Will these apps go into the mortgage business as part of their service line?"

Already, the Weilidai loan product offered by Tencent, the parent company of Chinese app juggernaut WeChat – a combination social media platform, messaging service and mobile payment tool – has a retail loan balance of at least RMB100bn (£11.4bn), comparable to that of major Chinese banks. However, the service does not yet offer mortgages, which comprise the bulk of traditional banks' balance sheets.

If they do enter the mortgage business, Nordberg speculates, "This might have some interesting consequences in the residential market." For example, lower-or middle-income prospective homebuyers unable to amass large deposits may find other entryways into property ownership, which could boost demand for new formal residential developments as Asia's upwardly mobile population transitions out of rental or informal housing.

Wuhan China
Technological leapfrogging has had an immediate impact on areas in Asia, according to Talox co-founder Antton Nordberg

Other prognosticators of future cities see the roots of an even more
ambitious leapfrog in property markets driven by the rise of the sharing
economy, such as the ride-hailing services Uber, Lyft and Grab. "From an asset
perspective, ride-hailing means city dwellers might not need to own and
maintain a car with all the burdens of car ownership," says Sameh Wahba, global
director of the World Bank's urban land portfolio. "Will fractional ownership
or alternative forms of housing lead to a scenario where you don't need to own
a house, which might reduce one's economic mobility?"

Such prospects might dispense with traditional asset ownership models, such as
homes purchased with mortgages, that have been the bedrock of urban property
markets. Along with the increasing popularity of remote working, Wahba believes
the rise of a "footloose urban population" that can choose to locate not based
on job is a trend with which competitive cities must reckon. Suddenly, the
amount of Class A office space available in the traditional CBD is less
important, he argues, than the quality of life the city offers.

"With technological advances, people are less physically attached to these key
assets that made the city what it is – a housing market and workplace with
residents commuting," Wahba says. "Instead, what will end up shaping the cities
of the future will increasingly be access to specific types of services that
cannot be substituted, such as higher education, and amenities like museums and
parks that increase liveability and attract a more mobile workforce."

Whether and how rising cities become magnets for this globalised workforce,
however, is a competition to be waged by relatively few superstar cities.
Across much of the developing world, there are still more mundane challenges to
be solved, such as reliable electricity and adequate sanitation.

 

“With technological advances, people are less physically attached to the key assets that made the city what it is. Instead, what will end up shaping the cities of the future will be access to specific types of services and amenities that increase liveability.”

Sameh Wahba
World Bank

Mini markets

Even in those more traditional development fields, there is the potential to leapfrog the exclusively centralised approach of legacy cities, which built energy and sewage systems across an entire metropolitan area managed by a single public or quasi-public utility. "The ability to not be so bound by centralised, heavy infrastructure that's not nimble or adaptable is useful, especially from a resilience perspective," says Gabriel Pincus of Chemonics, an international development firm based in Washington DC.

For example, German energy consultant TFE Consulting predicted in its 2017 report Kenya: The World's Microgrid Lab that the country's 65 microgrids are poised to expand to 2,000-3,000 by 2021, a market worth some $1.5bn. Meanwhile, mobile payment, the aforementioned M-Pesa platform, is driving Kenya's rapid adoption of diesel-electric hybrids as it provides a widespread, reliable way for low-income consumers to pay for electricity on demand.

Granted, much of the need for energy and sanitation is in rural areas, but as Africa and Asia urbanise, those lines become more blurred. So-called peri-urban areas, which were farmland a generation ago but now offer cheap housing for commuters to the big city, are ripe for this kind of leapfrogging. "Where you are most likely to see leapfrogging is in peri-urban and unplanned areas of cities where centralised infrastructure doesn't reach in a way that can meet the needs of the people living there," Pincus explains.

He points to septic systems as a type of infrastructure that can be more adaptable to the needs of a growing city. But the biggest change may come in how fast-urbanising cities manage these systems. Pipes have transported water at least since Roman times and there is no obvious way to leapfrog that technology, but how consumers pay for water, sewage and electricity is open-ended.

"Moving from a centralised utility to a system where you may have multiple service providers or mini-utilities is more revolutionary than any kind of physical technology," Pincus says, pointing to the 150-plus solid-waste companies that compete in Nairobi. He believes that with the right regulation in place to ensure the poor get adequate waste collection, and providers adhere to environmental standards, such a model can reduce prices and improve service."

This focus on business models squares with the rhetoric around leapfrogging observed by Pontus Westerberg, UN-Habitat programme manager and point person for the intersection of technology and urbanism. "Many cities in the Global South may not need more regulation, but they need to get away from informal systems and have more formal governance, revenue collection and planning systems," he says.

"If leapfrogging becomes less about technology and more about deregulation, I'm not sure we're achieving the kind of goals we want to see, which are well functioning, financed, planned, governed cities."

For Westerberg, the optimism embedded in leapfrogging masks hard economic realities. Seeing BRT as a way to leapfrog high-capacity transit is a fallacy. "We need to recognise that Johannesburg or Nairobi would love to have a subway system if they could afford one," he says. Instead, Nairobi is stuck with some of the world's worst traffic, driven in part by too few intersections – just 40 per km, well below UN-Habitat's standard for a functioning street grid.

To that misstep, Westerberg draws a simple conclusion: "Technology can have a big impact, but at the end of the day we can't forget urban fundamentals."