The greatest case of human migration has been going on in Asia over the past decades, forcing cities to grapple with the challenge of balancing sustained population growth with strained infrastructure, depleting resources and finite space.
Smart cities, which integrate cutting-edge information and communication technologies with urban planning, offer a compelling answer to this dilemma. The potential benefits of smart cities to urban livelihoods are significant, as is the investment opportunity.
What are smart cities?
The interpretation of smart cities varies, but it generally consists of six major pillars – connectivity, governance, services, automation, health and mobility – and employs key technologies like artificial intelligence, big data, cloud computing and robotics.
The major building blocks of smart cities
Did you know? Four facts about Asia's smart cities
28 megacities in the world
Asia is home to 16 of the world’s 28 megacities (populations above 10m), and the United Nations forecasts their cumulative population will double by 2030 from their 2010 total. This mass migration from rural to urban areas is occurring as the “fourth industrial revolution,” a period of rapid technological innovation, transforms the way we live.
Promising smart technologies
Promising technologies that can facilitate this smart transition include 5G and the Internet of Things in connectivity, digital repositories and sandboxes in governance, fintech and smart utilities in services, artificial intelligence and facial recognition in automation, big data and remote monitoring in healthcare, and autonomous driving, and ride hailing in mobility.
Asia's smart city pyramid
In Asia, Singapore is arguably the furthest along the smart city journey. Next up is Tokyo, which will likely showcase interesting smart solutions during the 2020 Olympic Games as it is the host. And with strong government initiatives and vibrant technology ecosystems, China and India show significant promise for the future.
Global smart city spending
UBS CIO expects Asia’s smart cities to generate trillions of dollars in economic value over the coming years as the annual combined smart city spending climbs to USD 800bn by 2025, according to our estimates, about 40% of the global smart city spending. Contributing USD 320bn, China should lead the region in smart city spending over this period.