The Relationship Between Urbanization and Economic Sustainability

Abstract

Sustainability Challenges in an Urban Century: Can We Change Urbanization Paths to Make Cities the Solutions for Rather than the Drivers of Global Problems?  Has received financial support from the government of Singapore and the Climate Change and Development Division of the Asian Development Bank. In 2008, it is estimated that more than half of the world’s population lived in cities and urban areas, which occupied only 0.8 percent of the world’s landmass. This number is expected to rise to 70% by 2025. Cities play an important role in the world economy, generating more than 80% of the global output and providing 70% of the jobs in Latin America, the Caribbean and other countries. The basis of economic growth in the last decades has been the concentration of economic activities in a few cities around the world. This agglomeration has allowed the worker productivity to increase, generated economies of scale and produced a better use of the existing infrastructure. But despite the fact that urbanization has been largely aligned with economic growth, it also has other consequences. Cities have the largest environmental impact, consuming 75% of the resources and generating 80% of the pollutants. With this rate of urbanization, the challenge is to provide the basis for the current and future populations to have a sustainable way of life in the urban areas. The latest reports on global climate change have shown that the rate of environmental degradation is occurring much faster than previously expected. This creates a “perfect storm” situation in which the impacts of population growth were not entirely predictable.