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Here's how rising global risks will change our cities

Sheikh Zayed Rd, Dubai, United Arab Emirates. Darcey Beau

Cities like Dubai, whose Sheikh Zayed Rd is pictured here, are the frontlines for high-impact risks. Image: Darcey Beau

Emilio Granados Franco
Head of Global Risks and Geopolitical Agenda., World Economic Forum Geneva
Richard Lukacs
Specialist, Global Risks and Geopolitical Agenda, World Economic Forum
Robert Muggah
Co-founder, SecDev Group and Co-founder, Igarapé Institute
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SDG 11: Sustainable Cities and Communities

This article is part of: The Davos Agenda
  • COVID-19 exposed vulnerabilities and deep-rooted inequalities in cities that will worsen as urbanisation continues and migration flows accelerate.
  • Climate action failure will add to the mounting pressure on urban spaces.
  • With careful planning, adaptation and the necessary investments, cities can become the new sustainability hubs of the future.

While the coronavirus pandemic is ravaging around the globe, we will continue to experience unprecedented urbanization in the coming decades. Today, 55% of the global population lives in cities: by 2050, this proportion is expected to increase to 68%, some 6.5 billion people. The vast majority of urban growth will occur in lower- and middle-income settings.

Cities are at the frontline for many of the highest-impact risks such as extreme weather events, digitally compromised networks, collapsing health systems and overwhelmed public services. COVID-19 has painfully exposed these weaknesses. Some cities will rebound quickly, but many of the world's fast-growing cities risk collapsing post-COVID-19. The future of sustainable development will thus depend on global capacity to enable thriving and inclusive urban spaces. Smarter density, rapid digitalization, renewable power and climate adaptation remain critical for cities.

The pandemic has disrupted how cities function worldwide. Some changes were positive. From the Americas and Europe to Asia and Africa, lockdowns accelerated digital onboarding and transformed how people interact. Long-established work habits, government practices and social norms were digitalized in weeks. The supply and demand for goods and services went virtual.

However, hardships deepened for the 45% of the world lacking access to broadband internet and the tools to work or study remotely. The economic shockwave of COVID-19 continues to affect lower-income and vulnerable populations. With job losses mounting, the pandemic is forcing many to search for new opportunities close to home and abroad. An influx of people could tip some cities to the edge; especially those already battered by declining revenue, rising deficits and environmental stress.

The Global Risks Report 2021 identifies critical blind spots that threaten cities: “climate action failure”, “social cohesion erosion” and “adverse tech advances”. Each of these globally neglected risks is already dramatically impacting cities and the lives and livelihoods of their residents.

Image: World Economic Forum’s Global Risks Report 2021

The search for safer space

The combined effects of the COVID-19 pandemic and the structural challenges outlined in the Global Risk Report 2021 are deepening pressures on city centres, suburbs and rural areas. But they are also imposing new stress. Many well-heeled urban dwellers could afford to flee to their second homes, in some cases generating inflationary effects. Large numbers of lower-paid and poorer urbanites also fled cities to return to their original villages – and continue to do so – as job prospects dry-up. Both trends are challenging cohesion between locals and newcomers.

Many of the world's most successful cities also benefit from a large share of migrants. Today, just 20 cities account for 20% of all migrants, many with strong ties to families in rural areas. Urban-rural remittances are an indispensable source of income. Yet the reality is that for many city dwellers, social safety nets, public services such as health and education, and even clean water and basic sanitation, are scarce. For people living in informal settlements including slums, favelas and shantytowns, such services may be altogether non-existent.

Although difficult living conditions are forcing people to flee many cities, other lower- and middle-income cities face an even more dramatic surge in urbanization. While many East Asian, European and North American cities are registering partial deurbanization; China, India and Nigeria are forecast to drive 35% of all urbanization by 2050. The pursuit of economic opportunities and the flight from insecurity will likely remain among the top drivers for cross-border and internal migration and displacement to cities.

The threat of climate change

“Climate action failure” will not only generate trillions of dollars in damages. It will compromise social cohesion and the survival of major cities. Most people already face limited options on where to live or relocate, which will only narrow as climate change ramps-up pressure in crowded cities. Some are already being evacuated and relocated ahead of devastating environmental threats.

2020 was the warmest year on record. Poorer air quality, extreme heat and rising sea levels are already transforming cities. Looming on the horizon, massive climate migration will intensify with coastal flooding, prolonged droughts or extreme pollution. Between 50 and 300 million climate migrants could soon be on the move. Within the next decades, one billion people are expected to live in insufferably hot spaces. Rising sea levels could displace the same number of people. The cascading impacts of rising temperatures and changes in precipitation are dire: at least 200 cities risk running out of water, heavily impacting food and water security.

Mapping water scarcity around the world Image: Source: Kookana, R., Drechsel, P., Jamwal, P., Vanderzalm, J.

The need for infrastructure of the future

The COVID-19 pandemic will also strain city coffers, undermining critical investment in new and sustainable infrastructure. Critical urban modernization projects are being shelved or cancelled, threatening the provision of basic healthcare, subsidized housing, free education and other public goods. The ability of cities to transition to a carbon-neutral economy is particularly at risk: over 10,000 cities have committed to a green transition, but they may not be able to finance it.

Cities thrive only if their population is safely harboured. However, the lack of affordable housing in many cities can exacerbate climate and societal risks. At least 1.6 billion people already lack adequate housing, which only 13% of the world's cities offer. As the global economy recovers, housing prices are expected to increase further; at the risk of inflating a real-estate bubble, or even worse, rising homelessness. More social tension would follow.

“Emerald cities” are possible

Cities will be fundamental in mitigating this risk. If they successfully anticipate and adapt to future mega-trends, they will be engines of growth, innovation, social cohesion and sustainable development.

Many cities are already investing in mitigation and adaptation strategies. More than ever, government planners, civic leaders and business need to integrate subnational development into their recovery strategies and investment plans. Different cities will need different approaches, but they should all prioritize investments that improve connectivity between cities and their surrounding areas. This will minimize social tensions and lead to more resilient value chains.

The Global Risks Report 2021 warns of the risks from social fracture; the collapse of cities will only exacerbate social unrest.


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