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Eighty percent of Chinese cities are failing to achieve a balance between economic growth, resource efficiency and sustainable development, according to a study by Accenture and the Chinese Academy of Sciences. The joint research, covering 73 cities, also shows that China’s mid-sized cities are in the best position to achieve that balance in the future.
The study, published in the New Resources Economy City Index Report, was conducted to help city authorities benchmark their progress in sustainable development in the context of China’s urbanization policy agenda. In addition to assessing economic performance against resource efficiency and environmental management, the Index scores cities’ capacity for future sustainable growth by measuring their level of infrastructure, technology innovation, and investment on environmental protection, as well as their institutional and policy capabilities.
There is little doubt that China’s urbanization and economic growth will continue. However, most experts agree that the current model of development of Chinese cities is unsustainable. The question is, how can Chinese cities strike a new balance between economic growth, resource use and environmental impact? How can they provide jobs and income, while remaining livable for the long term?
We believe that China is uniquely positioned to turn challenge into opportunity through the transition to a new development model; one in which the country’s continued economic prosperity is decoupled from its increasing use of scarce resources and increasing environmental degradation: We call this model the New Resource Economy (NRE).
The NRE encompasses all levels of society, from the individual through to the enterprise and government, and requires an economy-wide transition in how resources are sourced, consumed and managed.
To establish a quantitative baseline of how Chinese cities have been managing the challenges presented by urbanization to date, Accenture and CAS developed the NRE City Index. The index examines 73 Chinese cities and their performance on key sustainability and economic criteria.
Our research confirms that Chinese cities are currently on unsustainable development pathways and need to urgently transition to new approaches.
The analysis points to five key insights about China’s cities:
Unbalanced development but capacity to transition—China’s urban economic development is very unbalanced, resource and environmental sustainability are prevalent challenges. However, cities’ capacity for transformation does not vary significantly by economic development or by current track record of sustainability.
More developed cities show more unbalanced development—The most economically developed cities show more serious imbalances between economic growth, available resources and the state of the environment.
Mid-sized cities may have the greatest potential to adopt a New Resource Economy model—Cities with one to three million people are the key regions for future urbanization and at present enjoy relatively balanced development.
Poorly targeted urbanization is counterproductive in the long term—Although there are benefits in prioritizing development in some areas over others, most developed cities show the downside of overdevelopment.
“Resource-based cities” must change their development path—A number of Chinese cities are classified as “resource-based cities”. This is defined as those that depend on non-renewable resources for their rapid economic growth, these cities show the most unbalanced development.
Based on our analysis, we believe there are three broad areas of innovation that can enable cities to transition towards a New Resource Economy Model for more sustainable growth:
Innovation in policy and strategyAchieving a transition to balanced development requires a deliberate strategy, that is, a set of policies and plans. China’s city authorities and planners will need to take a long view, encompassing a broad range of economic, resource, social and cultural factors.
Sustainable master planning and urban design must be about more than just energy and water efficiency, connectivity to public transit networks and planting more trees. It needs to reflect the aspirations of the residents and support them in the way they want to live their lives.
Finally, development in any one geographic area should be closely coordinated with each of the others, with special attention to potential unintended consequences.
Innovation in technology. The opportunity for digital cities.Waves of innovations in digital information and communications technology are providing opportunities for Chinese cities to accelerate their move towards sustainable growth and a better life for their citizens. Key digital technologies include intelligent infrastructure, machine to machine communication (also called the internet of things), smart devices, mobility, big data and analytics, cloud computing and social media.
These technologies are connecting all elements of cities, encompassing citizens, public services, businesses, economic activity, buildings, transport, education and utilities including energy, water and waste. They enable economic growth, resource efficiency and environmental sustainability at equal measure.
Innovation in models for cross-sector and cross-regional cooperationGovernments lead China’s urban development and management. Achieving harmonious development and building livable cities demands strong cooperation between all levels of government authorities and among city governments.
As China’s growth continues at a pace, now is the time for governments, businesses and other stakeholders to start the move towards a new development model.
September 10, 2013
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