Growth of megacities: The sprawling metropolis of the future

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  Quantumrun Foresight
• February 17, 2023

With their large population base, megacities—which feature over 10 million people—provide a wealth of economic growth opportunities and new technological development. They also play a crucial role in shaping the political landscape, particularly between East and West, and are emerging as key players in global politics.

Growth of megacities context

According to business magazine CEO Today, there are currently 33 global megacities (2021), mainly located in South and East Asia, but this number can reach 43 by 2030, driven by Africa’s ongoing population boom. Some megacities listed by the United Nations Educational, Scientific and Cultural Organization (UNESCO) include Paris, London, New York, Moscow, Rio de Janeiro, Mexico City, Kinshasa, Cairo, Dhaka, Shanghai, Seoul, Tokyo, and Manila. The following locales are predicted to hit megacity status by 2030: Santiago (Chile), Chengdu, Xi’an, Wuhan, and Nanjing (China), Ahmedabad and Surat (India), and Kuala Lumpur (Malaysia).

Although Tokyo remains the largest megacity in Asia, China and India are rapidly developing their own megacities. Meanwhile, the African region is poised to have the most promising megacities in terms of technology, business opportunities, and human resources. The region’s population growth will continue to increase and remain young (average age between 18 and 20) throughout the 2030s.

The growth of megacities is driven by several factors, including rapid urbanization, increased globalization, and technological advances. By 2050, the United Nations (UN) estimates that 68 percent of the world’s population will live in urban areas, many of which reside in megacities. This rapid growth presents both opportunities and challenges for the communities and businesses within these cities. Megacities offer a wealth of innovation, entrepreneurship, and economic development opportunities. However, they also face various challenges, including overpopulation, traffic congestion, air pollution, and crime.

Disruptive impact

One of the critical risks megacities will experience is the sizeable need for new energy, water, and transportation infrastructure (among other essential services) to support their rapid growth rates. This challenge presents an opportunity for businesses and governments to invest in sustainable and resilient infrastructure that can meet the needs of these growing metropolises and withstand future climate change. Likewise, this need for significant infrastructure investments could see megacities becoming a higher profile front in geopolitical competition as developed nations compete to invest in emerging economies with growing populations and underdeveloped essential services.

For example, mass transportation and infrastructure upgrades in Tanzania’s Dar es Salaam and Angola’s Luanda were provided by Chinese firms. Vaccine politics has also swayed influence over the region, led mainly by China and Russia. If Western countries want to establish a stable footing in these developing megacities, they must act fast and engage in diplomatic and trade policies.

Two main areas that Western and Eastern firms can leverage further include technology and e-commerce. Megacities provide unlimited customers and employees for startups and venture capitalists focusing on digital services, such as telecoms, online shopping, and banking. Another area of opportunity is healthcare services, particularly medicines and vaccines. Ultimately, it’s up to governments to think of new urban policies to manage and further explore the potential of megacities.

Implications of the growth of megacities

Wider implications of the growth of megacities may include:

• The huge demand for transportation leading to congested roads, overburdened public transportation systems, and increased dependence on private vehicles, contributing to air pollution and greenhouse gas emissions. In wealthier, more proactive municipalities, public transportation and autonomous transportation systems will see massive investments designed to support urban density and reduce personal vehicle usage broadly.
• US/Europe competing against Russia/China to provide essential services to new megacities in the developing world.
• Large firms and manufacturing factories being built near population cultures to ease their recruitment needs.
• Real estate firms taking advantage of a large number of people migrating to megacities for labor and business opportunities by offering modular and communal living spaces.
• The essential services sectors aggressively using the Internet of Things (IoT) to enhance their public infrastructure developments to support increasingly interconnected and complex megacities.
• The law and order sector relying on public cybersecurity and biometric surveillance systems to keep track of large populations and prevent crime.
• The concentration of wealth and resources in megacities leading to income disparities and social exclusion, especially for low-income and immigrant populations.
• The high density of population and industrial activity in megacities resulting in air and water pollution, and soil contamination, affecting the health of urban residents and the surrounding ecosystems.

Questions to consider

• Have you experienced living in a megacity and a smaller township? What has been your experience in both in terms of professional and economic opportunities?
• How do you think your city will change in the next ten years?