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12 Apr, 2025
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Cities power growth. China has more megacities than anyone else
@Source: scmp.com
Enough is enough. I have reached saturation point with the uncountable words written recently on tariffs, most not worth the space they are printed on. I am weary of Tyrannosaurus Trump and his flat-earth efforts to explain or justify a clearly stupid global tariff regime, and of the thousands of commentators and analysts speculating forlornly on the implications of the unexplainable and unknowable. All we need to know is first, that the plan is nonsensical and likely unworkable; and second, that the uncertainty it generates will be bad, perhaps even catastrophic, for most ordinary people worldwide, including in the United States. The primary purpose is probably to swamp governments and media with so much chaff that leaders have no time left to manage their economies. Confident that in due course he and his acolytes will fall catastrophically from grace, I have been trying to distract myself. For example, with the alarming fact that last winter over half of America’s bee colonies – an estimated 1.6 million – died, jeopardising crop pollination; or the debate over abolishing daylight-saving time; or whether Kirsty Coventry, the International Olympic Committee’s first female head, will have the courage to change the Olympics business model. Or an old Visual Capitalist graphic from 2017, showing how 35 Chinese cities already had country-sized economies. Few people distant from China properly recognise the awesome size and diversity of China’s economy, and the more often we are reminded of this the better. A better recognition of China’s size, scale and complexity would help pre-empt naive, or plain silly, predictions that a deeply troubled property market, an ageing population or comparatively low levels of household consumption are about to bring this very large economy to its knees. The graphic shows a Shenzhen economy as large as Sweden’s, with Beijing’s as large as the United Arab Emirates’, Guangzhou’s as large as Switzerland’s, and Shanghai’s as large as the Philippines’. It shows that Chinese cities many Westerners may never have heard of would have seats at the United Nations if they were countries. There’s Wuxi, whose economy is bigger than New Zealand’s, or Hangzhou, whose economy is the size of Greece’s. I should clarify, however, that the Visual Capitalist’s comparisons are wobbly. First, measuring the size of a city’s economy is much trickier than calculating a country’s gross domestic product. And second, the data is for 2016 GDP in purchasing power parity terms, which are relative to local living costs. In the near decade since, most city and national economies have shifted significantly, in particular through the Covid-19 buffeting. But whatever the quibbles over the numbers, the message is the same: China has an awful lot of big cities, and many of them are significantly larger in both their populations and economies than many countries occupying UN seats. Perhaps as interesting is the remarkable pace at which China has transformed from a largely agrarian society to a mainly urban one. It goes a long way to explaining China’s radical industrialisation, and the pace and scale of investment in infrastructure. In 1980, as China’s opening up began, just under 20 per cent of its population lived in urban areas, compared to India’s 23 per cent. After four and a half decades of focused urbanisation, China’s urban population accounts for 67 per cent of the total population. Meanwhile, India’s urban population has risen to around 36 per cent. While the world’s most urbanised countries are in the West (many over 80 per cent urban), and the wealthiest cities still include New York, Los Angeles and Tokyo, China has clawed its way close. Its megacities clustering around Beijing, Shanghai and the Pearl River Delta area are also now on the heels of New York, Tokyo and London. China’s city-based growth is expected to remain strong. Today, there are over 460 cities worldwide with populations of over 1 million each, according to one list, (while about 40 countries still have populations smaller than a million each), with 130 of them in China and 50 in India. China’s leaders are firmly focused on further urbanisation, facilitated by reforms of the hukou residence registration system, which had turned rural migrants into second-class citizens in most cities). Most of the city-building of the future can be expected in China. The trend is important because city economies have, over the past 70 years, been the world’s main drivers of economic growth but also the source of many new vulnerabilities. Development of China’s megacity regions has underpinned the country’s growth as a manufacturing powerhouse, enabling Chinese companies to construct efficient and closely connected supply chains that sit at the heart of their global competitiveness. They have also been the source of most of our environmental and climate challenges, and the main incubators of pandemics. They are home to the world’s wealthiest families, and some of the poorest. They have problems, priorities and interests that diverge strongly from those of nation-state governments that tend to care more about declining rural areas and protected national boundaries. Cities are the world’s new power centres and the drivers of prosperity, but their voices are unheard, compared with the often-tiny countries that occupy seats in the UN, World Bank, International Monetary Fund or World Trade Organization. Over time, this is likely to change, and China’s cities will be in the vanguard.
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