Almost as staggering as the current enormous influx into cities across the globe is the dramatic slowdown in urbanisation that will follow it. The world is literally going to town on urbanisation – but it is a project that is both immense and historically fleeting.

In less than 100 years, the world’s urban population is expected to double to 8 or 9 billion – accounting for the bulk of a projected global population of around 11 billion. Yet in all the centuries that follow this one, cities may add, at most, another billion to their ranks. So if this century is the most urbanising in history, it will also mark the end of humankind’s “great urbanisation” era.



Thus the next few decades will be hugely influential in determining the patterns of production, behaviour and governance that humanity locks into, and the innovative efficiency with which it utilises the earth’s resources. The future of the world’s urban population will mostly be built in our lifetimes.

The consequences of bad government and inaction over planning and urban design will last decades or centuries. Once the urban population is stable, and road, rail and utility networks have been laid down, it will be much harder to undertake reform or retrofit urban infrastructure. This is why the subject deserves the urgent attention of policymakers, academics and business entrepreneurs worldwide.



This week, global leaders are meeting in Marrakech for the 22nd UN climate summit (Cop22). They are discussing how to limit greenhouse gas emissions sufficiently to hold global warming well below 2°C, as was agreed a year ago in Paris. If new cities are built on a carbon-intensive, resource-hungry model, then all hope of meeting these ambitious targets will be lost.

Humans work best in cities … but urbanisation also creates pollution, congestion, poor health, crime and waste

The good news, however, is that it is possible to meet these targets in a way that improves wellbeing and stimulates global productivity and wealth. Innovative, well-run cities are uniquely placed to solve these major global challenges, in conjunction with national governments.

Humans work best in cities, that’s why we’re moving there. The clustering of people generates higher productivity and higher wages. A mix of specialisation and diversity generates a fertile environment for innovation in ideas, technologies and processes.

But urbanisation also creates its own problems, in the form of pollution, congestion, poor health, crime and waste. Unregulated, unplanned urban sprawl is often the cheapest option in the short run – but the long-run costs to society, the economy and the environment can be dire.



At the UN’s Habitat III conference in Ecuador last month, global leaders and urban experts signed into force the New Urban Agenda, a blueprint for the next 20 years of urban transformation. It set out an ambitious and laudable vision of more compact cities and public transport-based development – but the real test will be in the implementation.

Turning words into action requires overcoming domestic opposition and providing finance to the cities most in need. This means recognising that climate action can deliver local benefits to citizens, even in the short term – and it’s why the Paris Agreement, which came into effect last week, set out to bring city actors together with national players through the Global Covenant of Mayors. Already, 7,100 cities from 119 countries have committed to the associated Compact of Mayors for Climate and Energy, pledging to support meeting national targets.

With the cost of renewable and energy efficiency technologies having fallen to levels competitive with conventional fuels (even before accounting for the unpriced costs associated with the latter’s use), the opportunities from urban action to reduce emissions becomes plain to see. Be it through investing in electric vehicles, building smart grids, constructing energy-efficient homes, planning limits on urban sprawl, investing in renewable power or providing integrated public transport, such action generates a number of important benefits – not least, tackling the growing and deadly problem of air pollution all over the world.

Pedestrians walk through dust and smog in New Delhi at the weekend. Photograph: Harish Tyagi/EPA

Air pollution costs millions of lives every year. The European Environment Agency estimates that premature deaths resulting from a single particulate pollutant (PM2.5) totalled approximately 432,000 in 2012 in Europe alone, while around 75,000 people die each year as a result of prolonged exposure to NO2 air pollution. A recent study by the World Resources Institute put the health impacts in China of PM2.5 exposure (including premature deaths) at a shocking 10-13% of the country’s annual GDP.

Thus, air pollution is one key reason why the Global Commission on the Economy and Climate found that more than half of the reduction in global emissions required to meet an ambitious climate target could generate net benefits to the economy.

Implementing policy action to reduce emissions is often easiest at the city level. This means increased effort is required to devolve administration to the urban level and empower cities through greater fiscal autonomy. Things like recycling schemes, energy from waste, broadband networks, integrated public transport systems, “smart” buildings and biking networks are easy to appreciate and can come with popular local support.

Corruption stifles incentives to work and innovate … and risks rendering cities dysfunctional

Local accountability is also a vital part of good governance. In large parts of the world, this means fighting urban corruption and supporting institutional capacity. Corruption stifles incentives to work and innovate, undermining property rights and threatening to usurp the returns to productive activities. This offsets many of the benefits of urban clustering, and risks rendering cities dysfunctional.



The tragedy is that some of the poorest cities in the world are also the fastest growing – and they lack the resources and capacity to prevent locking into structures that are inefficient, unreliable and polluting.



New mechanisms to finance investments in urban infrastructure and smart technology need to be developed. These may include: greater use of land-value capture mechanisms, where the construction of new transit infrastructure is financed with the profits generated by the increase in land value stimulated by the presence of that infrastructure; municipal bonds such as Johannesburg’s recently issued $136m (£110m) green bond; and the creation of dedicated national, regional or city-level investment platforms as mechanisms for aggregating smaller infrastructure projects and attracting private investment at scale.



But successful urbanisation is not just about infrastructure; it’s also about skills. Mexico and Rwanda have invested heavily in urban vocational and technical training. Investment in talent and skills (from jobs training programmes to secondary education) helps raise wages, attract talent and promote urban growth. It also improves the flow of information vital to civic inclusion and effective governance.



In other words, there must be continued innovation in governance and learning from best practice. To learn from each other and demonstrate the benefits of sustainable planning and decarbonisation, urban policymakers should develop and utilise city networks such as C40, the International Council for Local Environmental Initiatives (ICLEI), the Compact of Mayors and United Cities and Local Governments (UCLG), which all facilitate the sharing of experience.



Cities are at the heart of the process of human development, innovation and productivity growth. The world is moving to cities, and those we build over the next few decades will broadly define the urban centres we are stuck with for generations to come. Cities that are poorly planned risk leaving humanity with a hostile and potentially deadly climate.

The clock is ticking. Humanity has a narrow window of time in which to plan and design its future. That opportunity must not – and need not – be squandered.

Professor Lord Stern of Brentford and Dimitri Zenghelis are, respectively, chair and co-head of policy at the Grantham Research Institute on Climate Change and the Environment at the London School of Economics and Political Science