According to projections, nearly 70% of the world’s population will live in urban areas by 2050. While some megacities are already struggling to cope with the current inflow of people, it is important to create smart cities in order to make these urban areas more liveable and truly sustainable.
“It’s the era of ‘Uberisation’ of economies. Meaning, economies are becoming ones of service to its citizens. Undoubtedly a country’s economy is interconnected, and it is important for governments to understand this, and be part of the change,” says Laurent Lamothe.
There is a big opportunity in Africa, one where the leap-frogging capacity is possible, as the ingredients are there. But it is the implementation and financing that is always the Achilles heel of most governments. The policies, infrastructure, technology may be there, but it is the funding of Smart Cities that is a critical challenge. However, a government alone cannot achieve the development of Smart Cities. It has to be government-led in terms of creating the correct policy framework and then leveraging private sector innovation.
Additionally, governments must consider financing development one penny at a time. Emerging countries have very little means to finance their development, and innovative finance for development provides many opportunities. Innovative financing refers to a range of non-traditional mechanisms to raise additional funds for development utilizing “innovative” projects such as micro-contributions, taxes, public-private partnerships and market-based financial transactions. Thus, governments are able to leverage millions of transactions, apply a micro-levy onto those transactions and bring in millions of additional dollars for development.