Nations 'can learn' from China's successes

PUBLISHED : Monday, 19 March, 2012, 12:00am
UPDATED : Monday, 19 March, 2012, 12:00am


The lessons that China has learned from coping with an explosive rate of growth of its urban population can be put into practice in developing economies around the world, say analysts.

'The world faces a challenge of rapid urbanisation, and China stands out as a striking success in managing this challenge,' said Paul Romer, economics professor at the Stern School of Business at New York University.

'China can help the world urbanise and profit by it, with Chinese companies providing infrastructure construction and large-scale real estate development,' said Romer, who is also president of Charter Cities, a US urban research organisation.

He made the remarks during a recent visit to Hong Kong. They were echoed by Steven Townsend, global director of urban design at Woods Bagot, an Australian architectural and urban design firm.

The strengths of China's urbanisation which can be exported to other countries facing the same challenges include its ability to implement large-scale urban solutions and infrastructure such as linking its cities by high-speed rail, Townsend said. One reason for China's successful urbanisation is the firm control over planning by the central government.

Romer said the challenge to national governments was to strike the right balance between being authoritarian in certain aspects and letting market forces take charge in other areas - for example, where universities, restaurants and shops would appear. He said it was striking that rapid urbanisation in China had not led to the growth of slums.

'To prevent the growth of slums, the Chinese government enforced a requirement that every home should be connected to a sewage system. This has been a real success, and it amazes people in India and Latin America that China is a strong state that enforces laws.'

The challenge facing urban planners is immense, said Romer, who noted that over a period of 10,000 years cities were established for three billion inhabitants, whereas in the next 50 years another three billion people will need to be housed in urban spaces.

The United Nations predicts the world's urban proportion will soar from slightly over 50 per cent last year to 70 per cent by 2050.

In 20 years, China's cities will add 350 million people, international consultancy McKinsey forecasts.

Faced with these challenges, China should relax its hukou household registration system, Romer said.

'Because of the hukou system, you don't have complete mobility. The Chinese government should encourage mobility of people all over China. Badly run cities are where people move away from and well-run cities are where people move to.'

Romer also questioned the practice of local officials selling land for housing, which risks speculative bubbles. As an alternative, the government might retain ownership of the land, while private companies build and sell the homes.

'By owning the land, the Chinese government can stop speculation. If the government leases the land, it will earn a continuous stream of revenue. This approach can address the problem of affordability and avoid speculative bubbles,' he said.

Traffic congestion is a problem in many major mainland cities, Romer adds, and the central government has failed to implement measures to limit demand for cars by building adequate public transport systems quickly enough.

Bryant Lu, vice-chairman of Ronald Lu & Partners, a Hong Kong architectural firm, echoed this criticism and said many mainland cities were not well integrated with transport infrastructure such as train stations and airports.

The result is that as already large cities like Beijing and Guangzhou grow even larger, they risk becoming unmanageable urban sprawls, warns Martin Knights, global leader of Halcrow, a British infrastructure planning, design and management firm. 'By expanding outwards, you create long distances for people to travel into the city centre,' he said.

'It's inefficient in travel time, cost of travel, and cost of utilities and services for cities to keep expanding.'