May 27, 2016

World Cities face growth and other challenges, 2026 about two thirds of GDP from cities up from half now

By 2026, about two-thirds of the world's gross domestic product will be generated by cities, up from about half now.

Most of that growth will come from the emerging world, especially China and India, meaning the stakes to get growth and development right are increasing rapidly.
The challenges range from ensuring clean streets to confronting the impact of climate change. In Rio de Janeiro, the military roams the streets to crack down on crime; in Lagos, policy makers who have often left residents to their own devices now have to introduce governance without wrecking structures developed over the years.

It is a common misperception that megacities have been driving global growth for the past 15 years. In fact, most have not grown faster than their host economies, and MGI expects this trend to continue. Today's 23 megacities—with populations of 10 million or more—will contribute about 10 percent of global growth to 2025, below their 14 percent share of global GDP.




In contrast, 577 middleweights—cities with populations of between 150,000 and 10 million, are seen contributing more than half of global growth to 2025, gaining share from today's megacities. By 2025, 13 middleweights are likely to be have become megacities, 12 of which are in emerging-markets (the exception is Chicago) and seven in China alone.

Emerging-market mega—and middleweight cities together—423 of them are included in the City 600—are likely to contribute more than 45 percent of global growth from 2007 to 2025.

Indonesian Megacity Jakarta sees rising sea level challenge

By 2023, 80 percent of nothern Jakarta (population 10.4 million) will lie below sea level—up from 40 percent now. In 50 years, current streets could be at least 10 feet below it.

So this former Dutch trading post is embarking on one of history’s biggest seawall projects. In three phases over three decades, it aims to build an exterior wall off the coast that would be 25 miles (40 kilometers) long and 80 feet high, a third of which would sit above sea level.




SOURCES- Bloomberg, McKinsey, Frost and Sullivan

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