“Tackle two crises at once”

Why do we need a paradigm change in urban development?
The bare figures prove that “business as usual” is not an option. We are facing massive trends of urbanisation. UN-HABITAT estimates population growth in the large agglomerations to be six percent per annum. If we continue in the same manner with the same mindset as we have so far, we will move on from the non-governability of cities to the non-governability of the world as a whole. Today, cities are part of the problem; they have to become part of the solution if we are to achieve sustainability.

Please be more specific.
A city like Chongqing in China, with over 30 million inhabitants, is no longer a city as we originally knew it. Its infrastructure needs to be organised in a more decentralised manner and the corresponding technology has to be developed. Only in this way will the agglomeration be manageable. Otherwise, an effective use of capital and energy will be impossible.

Back in 1992, the UN Conference on Environment and Development in Rio de Janeiro stressed the necessity of conserving natural resources that are the basis for life in the long term. Nevertheless, short-term thinking has prevailed, with the climate crisis escalating ever further. What went wrong?
I believe we were victims of a certain euphoria. After the collapse of communism, we took too little heed of the inefficiencies of capitalism. We accepted that private decision makers in large companies acted globally – even though they were regulated and monitored only at the national level. The result was an asymmetry we still see today. We ignored the fact that the market needs regulatory frameworks and that global commons have to be looked after in our era of globalisation. Markets cannot do so by themselves. Their logic is short term. We must recognise once again that a social market economy requires regulations that are transparent and can be monitored.

The economic crisis seems to be pushing environmental problems off the agenda. Can we still afford to mobilise the resources needed to combat climate change and its consequences?
On the one hand, there is reason for pessimism. Hundreds of billions are being mobilised as quickly as possible to protect banks and stabilise jobs. Never before have we adopted laws so quickly in Germany. At the same time, the laws of the past have never had such far-reaching material impact as those that have now been adopted in such a short space of time. Those who only anxiously pay attention to the current quarterly profit are indeed fostering worldwide destabilisation.

So are we experiencing a system-related crisis?
We have to realise that this is a collapse of free-market economic systems. It is irritating that relevant knowledge is not heeded. We have been saying for years that we have to close circuits and engage in economic activity on a long-term basis. And now Germany is paying a “scrapping bonus”. The state is subsidising the purchase of new vehicles if old ones are scrapped in return. This approach corresponds to a dangerous throw-away mentality which will certainly lead to the next sales crisis.

In other words, you are pessimistic.
Yes, but not only. On the other hand, there is also the chance of a “new green deal” to tackle two crises at once. By means of economic stimulus measures, the economic crisis can be used to change structures in such a way as is necessary in the medium and long term. Unfortunately these elements can only be made out to a limited degree in the huge recovery packages up to now.

What would sensible measures to stimulate the economy have to look like with regard to urban development, for example?
We know that our cities in Europe – and even more so in North America – have developed on the basis of comparatively highly subsidised private mobility. This confirms the old adage that today’s structures reflect yesterday’s prices. If private mobility is cheap, this encourages sprawling conurbations that are unsuitable for alternative transport systems, for non-motorised traffic or local public transport. However, things will change. We are now seeing that entire structures are becoming obsolete in America because mobility costs are changing. That is why I am not only pessimistic. This crisis can and must be used to improve local transport and district heating networks, for example, as well as cogeneration. This would create jobs locally, at small and medium-sized enterprises. So we should not give up.

You are a member of the Advisory Board of the Cities Development Initiative for Asia (CDIA), a joint undertaking of Asian Development Bank and German, Swedish and Spanish development agencies. What are your interim findings after one year?
It is obvious that this initiative was urgently needed. That is evident right now, where there is an opportunity to tackle two crises at once. This is a time when pre-feasibility studies for innovative projects are needed, which is precisely what the CDIA is doing. Of course we have to make sure, however, that we do not content ourselves with feasibility studies, but see that the projects are implemented. It is not easy to find financiers willing to fund multi-dimensional proposals. No doubt, however, the CDIA is providing a solid base for pathbreaking investment in the sustainable development of Asian cities.

What possibilities does international cooperation offer at the local level?
In the climate-change debate, we have asked time and again why cities don’t cooperate with one another and implement Clean Development Mechanism projects, for example.

The CDM allows avoided emissions in poor countries to be credited to rich countries’ reduction commitments, provided they have financed corresponding measures. However, critics complain that industrialised countries take advantage of this to get out of clearing up their own mess.
This argument ignores the fact that every tonne of CO2 emitted in India, for example, is just as harmful as a tonne of CO2 from Germany. In India, however, it is possible to reduce emissions fast at comparatively little cost. Cooperation in accordance with the rules of the CDM means harvesting “low-hanging fruits”. These sorts of investments are especially lucrative. Why shouldn’t a German city use emissions certificates it earned through cooperation with municipalities in other parts of the world to attract investors?

But practice, you say, is difficult.
Several projects have got off the ground, but overall, progress is sluggish. The main reason probably lies in high transaction costs. German cities aren’t exactly swimming in money, but they have substantial expertise. Therefore, it would make sense to orientate municipal cooperation, which already exists to some extent, even more towards the issues of sustainable urban development. I believe that there are still many possibilities for both sides, particularly in reducing CO2.

The CDIA is focusing on Asia. Don’t we also need this sort of initiative for Africa?
When it comes to Africa one always has to say “but of course”. On the other hand, it is important to have a focus. Economically, Asia is ahead. With respect to structure and dynamics of development, a city like Hanoi cannot be compared to a city like Nairobi, where I lived for a long time. But the fact that urban development in Africa presents us with an enormous task has something to do with the social stability in the continent. And let’s not kid ourselves: we can see quite clearly repercussions of destabilised societies in Africa in the Mediterranean, on Lampedusa, and we can see how our society is obviously not in a position to handle these problems. In Africa, therefore, we have even more reason to show that meaningful support for development is not an expression of compassion but also represent an investment in social stability here in Germany.

The questions were asked by Michael Funcke-Bartz, who coordinates InWEnt's contribution to the Cities Development Initiative for Asia.