How to Reinvent a City, in 5 easy steps

I gave this presentation at GEL 2011 on 29 April at NYC. It was my first ever public talk. I think I was too nervous in front of the 400-strong crowd to deliver it as planned, but at least I’ve broken my public speaking duck. I figured I’d share the slides and speech with everyone here. Note that I am not prescribing Singapore’s model as the only way, and I am not ignorant of the byproduct of such an approach. I just think it’s an interesting and on a macro perspective, exceedingly efficient model to consider, as the starting point for refinement. As always, comments are welcomed.

Introduction

I am here to talk about how to reinvent a city in 5 easy steps. I think most of us live or work in a city. I also think this is a topic that is close to our hearts, as we collectively struggle to cope with the state of our cities amidst the national and global economy.

I care about the experiences cities give its inhabitants because I believe the future of our cities will be the legacy we city dwellers leave behind for our children. I’d like to leave behind a city that is better off than when I was born into it. I figured I’d condense what I know into something anyone could use and refer to. It’s not perfect, but it’s a start.

I am a Venture Capitalist investing in early-stage Consumer Internet startups, but my job has nothing to do with what I’ll talk about for the next 20 minutes. Instead, I’ll be drawing upon experiences from my previous life as a tiny cog in the large policy making wheels of the Singapore government. Before I share those 5 steps with you however, I’d like to say a few words about the significance of cities.

The 21st century will not be dominated by America or China, Brazil or India, but by the city

Last October, Parag Khanna (senior research fellow at the New America Foundation) said in an article on Foreign Policy that “the 21st century will not be dominated by America or China, Brazil or India, but by the city.” He believed that the age of nations is over, and the new urban age has begun. Just 100 cities account for 30% of the world’s economy, and almost all its innovation. Globalization has led to an easier flow and accumulation of money and people in cities, which, in Parag’s own words, “has increased the power and ability of cities to dictate their own agenda, to shape their own affairs.”

I took this photo while I was on my honeymoon, in Xi’an China. I find it to be an interesting juxtaposition of old versus new. My wife and I were walking along the ancient city walls near dusk, and no matter how I turned, I could never escape the residential and commercial buildings that lined the wall’s outer perimeter and stretched far past the horizon. As the sky darkened, the city lights turned on, and in that instant, if you were looking down from space, you’d see Xi’an join the constellation of cities shimmering across the dark side of the Earth. In this scene, national borders mean nothing; you can only see the lights of the cities.

Cities magnify humanity’s strengths

On a similar vein, Edward Glaeser contends in his book “Triumph of the City” that cities are our greatest invention – and by bringing people closer together – magnify humanity’s strength. By “strength”, Edward was referring to the best of our cities; the exchange of ideas, collaboration and ultimately civilization, even as the coming together of people result in the worst of our cities too; pestilence, suffering and degradation.

I took this photo last year at a Cuban town I passed by while driving from Havana to the post-card town of Trinidad. An old lady and a man sat next with a wall full of smallish handprints and watched life go by. Later on, I asked a local why there were so few youths on their streets. She said they had all gone off to study or work in Havana. The handprints on the wall were a constant reminder to those who had stayed behind.

As a race, we’ve identified ourselves, first as part of great ancient civilizations, then sovereign nations and now cities. The fact that someone introduces himself as a New Yorker carries with it much more context than if he had referred to his American citizenship. As urban density increases and interaction and collaboration continues to be aided by technology, it is likely that we’ll end up with a single megalithic civilization of cities. Like those Cuban youths conspicuously absent from the photo here, many more will leave their hometowns behind to join cities in the hopes of participating in their greatness.

The Pearl River Delta mega-city project will combine 9 of China’s largest cities into 1 super metropolis

To further illustrate my point:

In 2008, for the first time in human history, there were more people living in cities than in rural areas. The projected global population increase between the year 2000 and 2030 will mostly take place in the urban areas of developing countries. In the early 1980s, China’s rural population accounted for nearly 80% of its total. By 2009, its urban population has grown to represent 50% of the country’s 1.3b population, with over 160 cities with residents in excess of 1m. As a benchmark, Brazil has 15 on a national population of 193m, while the United States has 9 on a national population of 307m. I don’t go to China as often as my wife does, but from what she’s telling me, it’s clear that many parts of China have reached or exceeded the limits of their current infrastructure. In order to cope, China is learning from cities around the world, Singapore included, and investing heavily in infrastructure, to the tune of 16% of its GDP. In comparison, Brazil and the US each spend around 2%.

This is a Google Map of the Pearl River Delta region, in south-eastern China. The Telegraph reported in January this year that the Chinese government has plans to merge 9 of China’s largest cities into 1 super metropolis. Add those population figures up and you’ll get a mind boggling figure of 50 million. That’s almost 3 times of New York metro and 10 times Singapore, in a land area that’s 2.3 times that of New York metropolis and 56 times that of Singapore. The Guangdong provincial government immediately responded that they weren’t planning to merge the cities. Instead, they will be improving the integration of infrastructure, industries, urban-rural planning, public services, and so on in the delta region. Sounds like the same thing if you asked me.

In ancient times, the degree of sophistication reflected in this map would have already qualified this region as a civilization in its own right. Today, this is but 50 million or 3+% of China’s population. The bar has been raised many times over. I can’t even begin to imagine the splendour of humanity’s civilization of cities by the time we’re done…

As cities get larger, water supply and air pollution become most pressing issues

…or the squalor, you’ve got the obvious – air pollution, water shortages; and also the slums, religious and racial conflicts, and so on. At least 1 billion people live in slums around the world and live life in misery, as they face bleak prospects for jobs, poor sanitation, lowered life expectancy, crime and so on.

On a related note, if you have 20 minutes, do watch Stewart Brand’s TED talk on the ‘4 environmental heresies’.

British colonial rule brought Singapore this far after 146 years

Singapore was faced with these issues and more upon independence, after 146 years of British colonial rule and almost 2 years as part of Malaysia. The city state was viewed by many to be unviable, with pressing problems in unemployment (10%), housing, sanitation, education, lack of natural resources and lack of land.

This is as good a shot I could find of the skyline of Singapore, over 40 years ago. The original photo was found in a flea market in Brighton, UK. If you’ve visited Singapore in the past few years, you’ll know it’s nothing like this. We went from sleepy fishing village to bustling port and crown jewel of the British Empire in 146 years, and made the leap from third-world to first-world in less than one-third of the time.

Let me now tell you how I think the pioneering leaders of Singapore reinvented itself.

Step 1 – Start with the basics

It sounds obvious, but we began with the basics.

I snapped this shot in Lima, Peru back in 05, through a bus, as I zipped past in the back of a cab. I was expecting homelessness, but I didn’t expect potentially economically productive adults to be sleeping alongside the Peruvian elderly on the streets. He looked like he was no more than 35 years.

By the time I was born in 1981, the basics had already been taken care of in Singapore. My family was of the middle class. We stayed in a 750 sq feet public apartment, before upgrading to a 1300 sq feet public apartment when I was 10; my father worked in the government while my mother was a homemaker. My sister and I entered school at the ages of 6. Even on a single income, my parents always had more than enough food on the table. In contrast, my father spent much of his youth in shacks and slums and didn’t have the money to attend university. My mother stopped schooling when she was 16, and helped tend to her parents’ chicken and pig farm. In under 1 generation, significant progress had already been made.

Step 2 – Engineer for political stability, and have your best lead the way

With bread and butter issues out of the way, the next step is for the city to engineer for political stability, as the foundation from which to build upon. Of course, in order for this to work, the city needs to incentivize and motivate its best and brightest to step forth and serve. One might argue that it is much easier to convince the top talent of the city populace to do the job 46 years ago when they’ve got more to lose and had fewer alternatives.

Having said that, I think different times call for different sorts of leaders. I think “top talent” is no longer solely a function of intelligence and willingness to serve, but also empathy. What used to work before may or may not work the same way in today’s context, but one thing’s for sure; most policies take more than 1 political term to show results. The ship that is your city, helmed by your best captain and crew, will need political stability as the wind on its sails, in order to go the distance.

Step 3 – Educate, and attract talent above the population average

Political stability allowed the Singapore government to implement systemic changes to its education system, amongst others. Education was viewed as an enabler of social mobility and a great leveller; an early demonstration of meritocracy. I studied alongside minorities and rich kids and was given an equal fair chance to excel in standardized tests. Even though I am still a part of the middle class in Singapore, I’ve since received higher levels of education than my parents combined. Armed with the education I’ve received, I’ve been able to, at least so far, climb further up the social ladder than my parents ever could.

The education system is also used as a filter for future leaders of the city state. Elite students go though a competitive assessment process and are offered government scholarships at the ages of 18, to be systematically groomed to take up leadership positions within the government.

The Singapore government also recognized that organic talent development was not scalable. And so it pursued an active pro-talent immigration policy on 2 fronts to inject fresh perspectives, experiences and hunger into the populace. It gave scholarships to teenagers from neigbouring Asian countries to incentivize them to join the talent pyramid in the city. It also encouraged skilled professionals to live and work in Singapore.

I won’t talk about the rich and famous who’ve since called Singapore their home. Instead, let me tell you about Mr. Sasi here. Mr. Sasi began his life as an Indian national, but came to Singapore and got a job as a lecturer at a technical institute. He married a Singaporean and had 2 children. There are many more like him, who came, contributed and called Singapore their home. The city is richer in every sense of the word thanks to folks like them.

Step 4 – Share the wealth

With the first 3 steps, wealth is created and accumulated by the city. Singapore has a GDP per capita that places it amongst the top 5 countries in the world. Let us not forget to share the wealth fairly.

Two main instruments were used to share the wealth with the masses. The government pursued a policy of asset appreciation on the back of widespread public housing ownership, made possible by rising land prices due to sustained economic progress. A 700-sqft public apartment that was sold for $90,000 in 1990 had only cost S$15,000 10 years before, while a 1300-sqft public apartment bought for S$100k in 1990 is worth $600k today.

The other important tool is the Central Provident Fund (CPF), which has evolved from a simple savings-withdrawal retirement plan into a complex scheme that caters also to medical, educational and investment needs of the people. The government also gives direct cash top-ups into citizens’ retirement accounts in years of high surplus or external economic uncertainties.

And then there’s the less obvious and indirect, but equally important levers – income tax and healthcare. I don’t have time to cover them here, but let me leave you with 2 data points as food for thought. A typical college graduate who earns no more than US$35,000 per annum will pay about US$400 in income taxes. A typical visit to the doctor would set you back by US$20 on average. These direct and indirect levers combine to give people the perception that they’re all sharing in the upside.

Step 5 – Remain relevant

Even though we’re at the final step, the truth of the matter is, the reinvention of any city is a never-ending process. That is why it’s important for the city to remain relevant to its people and to the world. Steps 1 through 4 address the relevance of the city to its people.

A city has to remain relevant to the world so that other cities and countries have an interest in its continued survival. A city has to be ready to embrace globalization, to swiftly adjust its policies and remain nimble to seize opportunities and manage challenges that come with changing circumstances. As a city, Singapore has reinvented itself time and time again and continues to reinvent itself, almost to the point of paranoia.

This is what we achieved in 46 years, on our own

And this is how the skyline of Singapore looks after 46 years. It took the city and its pioneering leaders some time and plenty of sacrifice to get here. We’ve proven that it’s possible to take marshlands and turn it into a gleaming city.

Yet, all that glitters isn’t gold; a rising tide does not lift all boats

Before I end my talk, I’d like to put forth 2 challenges that arise from successful reinvention of cities through these 5 steps. At the end of the day, all that glitters isn’t always gold. The relentless pursuit of success and excellence means its going to get harder not to leave some segment of the community behind. Some tradeoffs will need to be made between growth and inclusiveness. Care needs to be taken to avoid backlash from people who feel disenfranchised.

Political stability = Groupthink? Should an always successful leadership be the one and only way?

Also, I believe political stability may become harder to maintain as the city matures, gains a more diversified population demographic and the community starts clamouring for diversity of views. The line between political stability and political diversity is an extremely fine line to thread.

Interestingly, the PAP (ruling party) saw a further decrease in popular support, dipping from 75% of votes garnered in 2001, to 66.6% in 2006 and 60.1% at the Singapore Elections 2011. Also read Tim Ferguson’s post on Forbes titled “One Party But Not Just One Outcome”.

Conclusion

And with that, I’ll leave you with this quote from the founding father of modern Singapore, Minister Mentor Lee Kuan Yew. He said in his recent book titled “Hard Truths to Keep Singapore Going”, that “Singapore is an 80-storey building on marshy land. We’ve learnt how to put in stakes and floats so we can go up for another 20, maybe over a 100 storeys. Provided you understand and ensure that the foundation is strong. Crucial is inter-racial, inter-religious harmony. Without that, quarreling with one another, we are doomed.”

About James Chan

James Chan is an entrepreneur, investor, geek, photographer and husband/father based out of Singapore. Apart from frequent travels to Vietnam, Myanmar and Indonesia for work, James can also be found online via his trusty 15" Retina MacBook Pro or iPhone 6+.