ASEAN’s Emerging Cities Take Centre Stage

Much of Asia's growth in the coming decades will be witnessed within ASEAN. Long considered a buffer and middleman between East and West, ASEAN lacks discussion on its capability as an economic and geopolitical player. Yet, its nominal GDP was $2.3 trillion in 2012, nearly double that of India's.

Emerging cities in ASEAN will take centre stage in the region's growth narrative, as how growth in industrial revolution' Britain had relied mostly on its outlier cities. Leveraging on this increased awareness of emerging cities, the LKY School in conjunction with Oxfam organised the Asia Development Dialogue (ADD) Building Resilience and Effective Governance of Emerging Cities' on 7 and 8 April 2014. Mayors and officials from over 30 cities were invited to Singapore along with experts and academics to share their experiences and gain new insights.

Ora-orn Poocharoen, Assistant Professor at the LKY School and member of the ADD Advisory Committee said, As Asia assumes a role of primacy in the global economy, emerging cities will be the engines of growth within the ASEAN region. Growth that is both equitable and sustainable can only be achieved through effective governance and resilience capacity building. The Asia Development Dialogue allows leaders of these cities to share best practices and brainstorm on solutions for shared problems.

To invest in Bangkok, Jakarta, Manila and other capital cities, a plethora of challenges including high rent, a limited market of suitably skilled but highly mobile labour, longer approval times and stiff competition from existing players will be faced. Many multinational organisations have already jumped on this emerging cities bandwagon. In the Philippines, for example, the leading global providers of business process outsourcing (BPO) services have expanded their delivery centres in these emerging cities such as Davao and Iloilo. Global manufacturing companies have also established their factories and processing plants in these emerging cities.

Emerging cities are also the ideal incubators for local start-ups. Business owners can take advantage of lower rentals and reduced wages. Businesses should look to grow out of emerging cities to capital cities and not vice versa. To ensure that these emerging cities provide business owners with the necessary eco-system to thrive, honest and effective governance is key.

As ASEAN undergoes its own wave of democratisation, decentralisation is a consequent by-product. This leads to greater autonomy for secondary cities but also creates increased opportunities for corruption and usurping of power. It is necessary to ensure that capacity building is held in great importance by city officials. A city with independent and clean' organs of state is necessary to ensure sustainability and growth. Traditionally, ASEAN countries have focused on their primary cities and not paid sufficient attention to capacity building in emerging cities. ASEAN should utilise existing networks such as the ASEAN University Network and ASEAN Foundation to provide expertise, training and support in capacity building to city officials.

Resources would also need to be invested by these cities in ensuring that their resilience capacity is built up. Tragically, many ASEAN nations are prone to natural disasters, the Boxing Day tsunami and Typhon Haiyan are just some of the more devastating examples. Despite great leaps in technology, disasters like these are almost impossible to prevent. Cities can only mitigate the damage inflicted.

Emerging cities can also effectively act as test beds for new and cutting edge technological innovations. It is logistically much easier for large technology companies to test and evaluate their products in emerging cities allowing them to be technological leaders within their respective countries. As ASEAN prepares to take its place on the global stage, its leaders should not be solely focused on the primary cities but also appreciate the importance of emerging cities.

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