Future-Proofing Cities: Evolutions in Sustainability-Centric Urban Design | Asia Summit 2024

Panel Overview and Context

• The panel "Future-Proofing Cities: Evolutions in Sustainability-Centric Urban Design" was moderated by Sarah Murphy, Senior Fellow at the Asia Program of CSIS.
• The discussion focused on the intersection of rapid urbanization, climate change impacts, and demographic shifts in Southeast Asia, where cities face risks of sinking and displacement.
• Key panelists included Stephan Esselin (Horizon Asia CEO), Clarence Barboza (Cisco Systems), Skye Dharmina (Generate Capital), Andy Hodgson (Arup), and Shruti Narayan (C40 Cities).

Infrastructure and Transportation Priorities

• Transportation and green public transit are identified as the primary infrastructure needs to decarbonize cities and enhance livability.
  • Singapore's 92% public transit usage is cited as a benchmark for success.
  • Bangkok, Kuala Lumpur, and Jakarta suffer from low public transit coverage (30% and 2-1 line respectively), contributing to high car dependency.
• Governments are urged to prioritize the expansion of the middle class, which is viewed as essential for economic viability, given the 750 million population in Southeast Asia alone.
• Energy transition requires a shift toward solar power, leveraging Asia's demonstrated capacity for rapid implementation of major projects.
• Disaster resilience is critical due to increasing frequency of extreme temperatures, typhoons, and earthquakes across the region.
  • Kuala Lumpur's "Smart Tunnel" (2002) is highlighted as an early example of dual-purpose infrastructure serving as both a transport corridor and a flood control facility.
  • Hong Kong is noted for moving treatment plants underground (e.g., Shatin) to restore surface open space.

Digital Connectivity and Cybersecurity

• The pandemic exposed significant digital deficits, driving governments to reinvest in technology to improve citizen engagement and reduce service costs.
• A major trend is the shift of government services (permits, applications) to online platforms to eliminate the need for citizens to queue in person.
• Cybersecurity threats have escalated alongside digital adoption, with ASEAN nations facing hundreds of thousands of cyber attacks and scams weekly.
• Critical infrastructure (water, energy) is increasingly vulnerable to ransomware attacks, requiring robust digital protection frameworks.
• The panel emphasizes that digital adoption must address the "digital divide" and ensure skill-building extends to rural and vulnerable communities, including senior citizens.

Financing and Investment Models

• The majority of sustainable infrastructure capital must come from the private sector due to constrained government budgets.
• Large institutional investors (pension funds, sovereign wealth funds) typically require specific return profiles: high single digits for debt and low double digits for equity.
• A structural gap exists between the need for smaller, distributed sustainable assets and the preference of institutional investors for large, single-asset deals ($300M–$500M).
• Generate Capital proposes a model of long-term asset ownership and operation (20–40 years) to align with the needs of distributed sustainable solutions.
• Cities often lack creditworthiness, necessitating de-risking mechanisms, guarantees, and blended finance structures involving MDBs, philanthropy, and private capital.
• Alternative financing involves partnering directly with corporations (e.g., providing solar energy to Starbucks, clean buses to Meta) rather than relying solely on municipal credit.

Governance, Capacity, and the "Future of Work"

• Cities compete for capital, talent, and raw materials, with competitiveness increasingly tied to the ability to face climate and societal challenges.
• A significant gap in institutional capacity exists in ASEAN, hindering the effective definition, delivery, and governance of sustainable projects.
• The transition to a green economy requires a comprehensive skills strategy, including upskilling mid-career workers for new sectors like the hydrogen economy.
• City leaders face the dual pressure of maintaining political mandates through service delivery while managing the risk that a single climate disaster could erase years of budget planning.
• C40 promotes "Climate Budgeting," a framework adopted by 12 cities (including Davao, South Mumbai) to integrate climate goals directly into municipal accounting and project pipelines.
• Multi-level partnerships are essential, as seen in the COP-launched CHAMP initiative, to align city actions with national NDCs and energy transition goals.

Innovation, Nature, and Best Practices

• The "circular economy" is a critical but under-adopted concept, particularly regarding full life-cycle carbon accounting and waste repurposing.
• The Ontario organic waste facility is cited as a best practice for converting 150,000 tonnes of waste into renewable natural gas and bioplastics, fueling carbon-neutral buses.
• Adaptive reuse of existing buildings (e.g., repurposing distribution centers for chip factories) is recommended to minimize embodied carbon from new construction.
• Indonesia's new capital, Nusantara, is designed as a "10-minute city" with net-zero transportation built-in, avoiding the need for future retrofits.
• Urban farming initiatives in Quezon City, Philippines, successfully unlocked private land for local produce generation through tax exemptions, inspiring national-level adoption.
• Nature-based solutions and "natural capital" are emerging as investment priorities, with private sector interest in nature funds growing.