Urbanization Takes on New Dimensions in Asia's Population Giants

(This is an expanded version of an article that appeared in the October 2001 issue of Population Today.)

(October 2001) For the first time, more half of the world’s population will be living in urban areas by the end of this decade. In 1999, 47 percent of the world’s population (2.9 billion people) lived in urban places.1 By 2030, the UN projects that proportion will reach 60 percent, totaling 4.9 billion people. Roughly 95 percent of this massive urban growth will occur in less developed countries.2

More than 60 percent of the increase in the world’s urban population over the next three decades will occur in Asia, particularly in China and India, but also in Pakistan, Bangladesh, the Philippines, and Vietnam. Asia will have a lower overall urbanization rate in 2030 (53 percent) than any other region — Africa will be slightly higher at 55 percent, while Latin America is projected to reach 83 percent — but Asia’s total urban population will exceed 2.6 billion in 2030, compared with 604 million in Latin America and 766 million in Africa (see figure).3

Urban Population by Region: 2000 and 2030

*LAC = Latin America and the Caribbean.
Source: UN, World Urbanization Prospects: The 1999 Revision, 2000.

In Asia and elsewhere, the prospect of urbanization on such a massive scale fuels concerns that the world may not be able to sustain such large urban populations. For some, cities are seen as potential disasters. The growing concentration of people poses a fundamental challenge to the provision of economic opportunity, the development of adequate infrastructure and liveable housing, and the maintenance of healthy environments. In poorer cities, a significant proportion of the population is often forced to live in ill-serviced housing in areas highly vulnerable to natural disasters such as flooding or landslides.

But there are also reasons for optimism. The historic association between economic development and urbanization is well established. Cities are crucial environments and institutional assemblages for economic growth. Current research indicates that even in less developed countries cities experience lower rates of natural population increase than rural areas, average household income is higher, and educational levels are well above those in rural areas. Thus cities can also be seen as places of opportunity in which the major need is effective management and provision of services, creation of economic opportunity, and the provision of safe and healthy environments.

The Challenges of Asia’s Urbanization

To some extent, the challenges of urbanization are the same everywhere. These include enhancing economic opportunities for urban populations, improving transportation infrastructure and housing, providing social services, maintaining a liveable environment, and developing effective systems of governance and management. It is therefore possible to argue that there is nothing distinctive about the challenges posed by Asian urbanization.

Upon closer inspection, however, the process of urbanization in Asia has several distinctive features, a number of which stem from the massive size of the region’s population:

  • Dominance of the population giants. Unlike any other region, Asia has five less developed countries with more than 100 million people — China, India, Bangladesh, Pakistan, and Indonesia. These countries made up 75 percent of the Asian population as of mid-2001. In 2030, they will be joined by Iran, the Philippines, and Vietnam, and together these countries will constitute 81 percent of Asia’s population. The combined urban population of these 8 countries will grow by more than 1 billion people in the same period, making up roughly four-fifths of the total urban increment in Asia. The dominance of the population giants in all-Asia averages is important to keep in mind since it can obscure developments in the region’s numerous smaller countries.
  • Immense urban increments. The sheer size of some Asian populations forces governments to cope with a large volume of urban increase in a very short period of time. The urban populations of both China and India, for example, will grow by more than 340 million by 2030. This creates tremendous challenges in the provision of infrastructure, environmental management, and employment.
    Even a small country such as Laos (5.3 million in 2000), one of the poorest countries in the world, will add 3.2 million to its urban population while it moves to a level of only 43 percent urbanized in 2030. This will be more than 60 percent of the country’s total population increase in that period. Given its very low national income and the continuing high proportion of people in rural areas, it will be very difficult to give strategic priority to urban development, even in the capital city of Vientiane.
  • The prominence of megacities. By 2015, 16 of the world’s 24 megacities (cities with more than 10 million people) will be located in Asia, according to the UN’s World Urbanization Prospects: The 1999 Revision. Most of these megacities will be located in the population giants. While most urbanites both in Asia and elsewhere will continue to live in smaller towns and cities, the urban hierarchy of Asia will be dominated by the emergence of these larger cities.4 Urban development will often stretch in corridors between the main city core and secondary cities, much like the megalopolis of the eastern United States.
  • Uneven globalization. For the past two decades, Asia has surpassed the rest of the less developed world in terms of integration into the global economy, creating greater opportunities for urban development. This development has proceeded unevenly, however, and a two-tier urban system is likely to emerge in Asia as a result (see table). Some urban areas will be increasingly integrated into the global economy and become more international in character. These towns and cities — such as Seoul, Singapore, Taipei, and Shanghai — will have to manage the challenges and opportunities that come with rapid economic growth and change. On the other hand, there will also be cities with more domestically oriented economies that develop more slowly. These urban places will face greater challenges in terms of poverty and creating opportunities for economic growth. Cities such as Dhaka, Phnom Penh, and Vientiane exemplify this group.

A Tale of Two Cities: Seoul and Dhaka

The two-tier structure of Asian urbanization described above can be illustrated by comparing two of the region’s largest cities, Seoul and Dhaka.5

The Seoul Metropolitan Region: Planning with Growth

The city of Seoul, with a population of 10.3 million in 1998, forms part of South Korea’s capital region, which includes the city of Inchon as well as Kyonggi province. Including Seoul, this region had a population of 20.7 million in 1998. As the capital city, Seoul has been at the center of South Korea’s remarkable economic transformation over the last four decades. In 1961, the national population stood at 24.6 million, per capita income was US$83, and primary production made up 37 percent of GNP.6 By 1990, the population had almost doubled to 46 million and the contribution of the primary sector to GNP had fallen to 10 percent. The national level of urbanization had risen from 28 to 75 percent. Much of this societal change was due to the growth of industry, which increased its share of GDP from 20 percent in 1960 to 44 percent in 1990.

In the 1960s, much of South Korea’s industrial growth was focused on greater Seoul, which by 1970 had 52 percent of the country’s industrial workers. The major contributor to this growth was rural-urban migration, which accounted for 50 percent of the country’s urban increment in the 1960s. This very rapid growth of Seoul’s population placed pressure on the city’s infrastructure, leading to marked growth in squatter settlements, increasing traffic congestion, and growing air pollution. This led the government to adopt a national decentralization strategy in the 1970s that attempted to divert industry to other areas of the country. New industrial complexes were established in the southeast part of the country. In the 1980s, continuing efforts were made to decentralize economic activity, and ambitious investments in Seoul’s infrastructure and public and quasi-public housing were made before the 1988 Seoul Olympics.

In the late 1980s and 1990s, Seoul continued to lose industrial employment and increase its employment in the service sector. For example, 44 of South Korea’s top 50 firms by sales have their headquarters in Seoul. The upshot of this trend has been declining population in the Seoul area. In addition, due in part to the city’s success in hosting the Olympics, Seoul has embarked on an ambitious effort to become a global city with the addition of a new airport and greatly enlarged subway system. Today, Seoul ranks number 13 out of 44 in the Asia Urban Quality of Life Index prepared annually by Asiaweek magazine. In short, while Seoul still has many problems, the government has responded very successfully to the urban challenges that will face many other Asian countries over the next thirty years.

Dhaka, Bangladesh: Ongoing Urban Poverty

Dhaka’s population of 6.5 million is crowded into 360 square kilometers, creating one of the highest urban densities in the world. The city proper also forms part of the Capital Development Authority that administers an area of 1530 square kilometres, an area that is home to an estimated 10 million people. Unlike South Korea, Bangladesh has not experienced rapid economic change, and agriculture remains the major component of GDP and the main source of employment. While general economic conditions have improved somewhat over the last twenty years, Bangladesh is still a very poor country. In 2001, gross national income (adjusted for purchasing power parity) stood at US$1,530 per capita — far below the average for Asia as a whole (US$3,930) and even below the average for Africa (US$1,790). And while estimates vary, most analysts place the current incidence of poverty in both rural and urban areas at between one-third to one-half of the population.

Dhaka’s rate of population growth has declined slightly over the past three decades, but it still remains among the highest in Asia (4.2 percent annually). The continuing growth reflects ongoing migration from rural areas to the Dhaka urban region. Such growth accounted for roughly 60 percent of the city’s growth in the 1960s and 1970s, but more recently the city’s population has also grown as a result of the expansion of its administrative boundaries, a process that added 1 million people to the city in the 1980s. In contrast, the rate of natural increase (i.e., growth due to births exceeding deaths) in the city has been falling, as is the case in most other Asian cities.

Dhaka’s growth has not been associated with an expansion of productive employment opportunities in relatively high wage areas. Instead, there has been growing employment in the low productivity, low-income sector, such as petty retailing or rickshaw driving. This has meant that the number of people defined as poor in the city grew by almost 2 million between 1980 and 2001. While in recent years the introduction of textile export industries and remittances from international labor have begun to diversify the economic base of the city, it still remains desperately poor (see table).

Asia’s Two Urban Tiers: Seoul vs. Dhaka, 1998

Seoul Dhaka
Resident population (millions) 10.3 6.5
Annual rate of increase -0.70% 4.20%
City product (per capita)* US$30,000 US$2,801
Under-5 child mortality rate 0.60% 9.30%
Adult literacy rate 100% 60%
Households with telephone access 95% 9%

Dhaka offers a very different statistical picture from Seoul’s. The population is growing quite rapidly due to rural-urban migration, urban boundary extension, and to a declining extent, natural increase. This growth rate is further enhanced by increasing life expectancy and population momentum (a high proportion of the population is under the age of 15), although infant mortality remains high. Given the large numbers of people living in the city and the generally low incomes, current investment in social services is inadequate. The number of children per classroom and the number of people per hospital bed are among the highest ratios of the cities in the Asia Development Bank database. Dhaka also has a weak physical infrastructure, with a transportation system that is dominated by pedestrians and rickshaw use.

Dhaka has a very uneven mix of physical service provision. Only one-quarter of the city’s population is connected to the piped sewerage system, and only two-thirds of the households are connected to water. A majority of the unconnected households use open latrines. The result is that Dhaka has one of the highest rates of death from infectious disease of any city in Asia. Finally, Dhaka is located on a flood plain and is vulnerable to flooding and other environmental disasters. In short, Dhaka is a city very much on the edge of sustainability. National policies that promote economic growth and urban governance that provides adequate services will be crucial in creating a sustainable, liveable, and healthy city in the future.

Sustainable Development and Cities

The preceding examples offer two extremes of the types of policy challenges faced by the emerging megalopolises of Asia. In cities that are rapidly developing — like Seoul — many of the environmental, transportation, and liveability issues are being addressed. The central policy issues in such cities stem principally from managing growth and mitigating the adverse side effects of economic expansion, particularly in the environmental sphere. At the same time, it should still be stressed that there are still sizeable numbers of poor residents who need help in such cities.

In contrast, the health and livelihood of residents of low-income cities such as Dhaka are undermined by fragile social infrastructures, lack of opportunity, and a marked vulnerability to disease and environmental disaster. In these cases, the major needs are to create a city in which basic needs can be satisfied and opportunity created. Economic, educational, environmental, and health policies have to be directed to the alleviation of these problems.

The urban transition now underway in Asia involves a volume of population much larger than any other region in the world and is taking place on a scale unprecedented in human history. In light of these facts, there are numerous policy implications that need to be considered, all of which involve improving the effectiveness of urban management. The development of effective policies should include the following:

  • Creating effective urban databases that enable ongoing monitoring and assessment of city performance.
  • Re-evaluating the relationships between national and city governments as urbanization proceeds. For example, decentralization programmes introduced in the Philippines in 1992 have led to fiscal control being transferred to local governments and created many successful local initiatives.
  • Providing more low-income housing units, improved transportation systems, clean water and sanitation, and social services.
  • Encouraging the participation of civil society in urban governance. For example, the creation of an adequate infrastructure for the cities of Asia will require the investment of trillions of dollars over the next twenty years, a portion of which will have to come from the private sector. To be effective, this process needs input not only from the private sector and local urban governments but also from citizens groups working at the street level as well as national governments and international aid agencies.
  • Developing and enforcing environmental standards. This, too, can involve civil society: One important aspect of urbanization in Asia today is the emergence of community-based organizations in poor areas that develop effective local responses to environmental degradation. These organizations are often supported by networks of NGOs that extend their practices to other cities. City governments must learn to work with such groups.

This is a demanding set of challenges, and for many it seems daunting. In Asia, ad hoc approaches will not lead to the development of sustainable and liveable cities. The first steps to cope with the challenges of Asian urbanization are to recognize that urbanization is an integral part of development and give strategic priority to policies for the urban sector.

Terry McGee is a professor of geography at the University of British Columbia, Vancouver, Canada.


  1. Unless otherwise noted, all urban population estimates and projections in this article may be attributed to the UN Population Division’s World Urbanization Prospects: The 1999 Revision (Geneva: UNFPA, 2000).
  2. There is no general agreement among governments or indeed urban experts on how to define urban settlements. Most governments define urban settlements in one of four ways. First, it can be defined on the basis of threshold size (for example, all communities with at least 2,000 residents). Second, urban spaces may be designated according to size thresholds combined with other criteria such as density. Third, administrative definitions may be used. Fourth, they can be defined as settlements listed in the national census as urban places. This definitional confusion is further compounded by wide variation in the manner in which urban boundaries are delimited. For example, some countries limit urban definitions to administrative boundaries while others extend boundaries outward to include contiguous peri-urban areas of settlement. Such variation makes international comparisons of the urbanization process extremely difficult. For more on global urbanization prospects, read PRB’s Population Bulletin “An Urbanizing World” by Martin Brockerhoff.
  3. The definition of Asia is highly problematic. In this analysis, the United Nations Population Division definition is used. It includes the area conventionally described as Asia including South Asia, East Asia, and Southeast Asia. But it also includes the Middle East and Central Asia, areas that are not always included in definitions of Asia. Note that this definition does not include Russia, which is included in Europe.
  4. Despite the rapidly increasing number of megacities around the world — from 3 in 1970 to 24 projected for 2015 — most of the world’s urban population lives in much smaller towns and cities. In 2000, 50 percent of the world’s urban population lived in cities with fewer than 500,000 people. Twenty-five percent lived in cities with between 1 million and 5 million people, while only 9 percent lived in megacities. By 2015, the percentage living in cities of less than 500,000 is expected to fall to 48 percent, while the proportion in megacities is expected to rise slightly to approach 10 percent.
  5. The urban population figures used in the following section are based on Asian Development Bank (ADB) data from 1998. These data are available on the ADB’s “Cities Data Book” website
  6. Primary production refers to production, harvesting, and extraction of primary resources such as food, wood, metals, and oil.