by Mitch Kokai
Senior Political Analyst, John Locke Foundation
THE UN SAYS the global population will reach 9 billion by 2050. Six billion of that population will live in urban areas. That’s a jump of 2.5 billion city dwellers over the next 35 years.
Argue the numbers all you wish–I’m skeptical that world population will grow as fast as the UN predicts. Still, the effect on cities will be inescapable, whether the jump in city dwellers is 1.5 billion or 2.5 billion. The stresses on cities will be enormous: water, food, energy, transportation, health care, security, crime, quality of life.
This is why we love capitalism: The opportunities will be huge, too. The smart-city innovation race will generate tens of trillions of dollars in the coming decades. Which countries and companies will be the big winners?
I see three categories of winners. The first will be suppliers of digital technology, from high-speed telecom, cloud services and digital security to apps, for example, like Uber’s and Airbnb’s that use physical resources with greater efficiency. But these can get you only so far.
The second category will be traditional industry reborn. The trick will be to find breakthroughs in materials, construction and transportation–updates to the blood-and-sweat stuff that built the great cities of the 20th century. Will the winners be known names, such as GE, Mitsubishi, Tata and Samsung, or new players?
A third category will be the smart cities themselves. Leaders will likely create services that can be used to teach other cities, so their expertise will have value beyond the benefits enjoyed inside the cities. Smart cities will enjoy premium brands in a tough global economy, and they will attract talent.