Metro Manila seen benefiting from ‘smart city’ tech — McKinsey

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MCKINSEY Global Institute (MGI) said “smart city” solutions may help resolve problems in managing urban development in Metro Manila.

In a study released on Friday, it identified Metro Manila as one of the seven cities in Southeast Asia where digital technology can play a role in improving quality of life.

“Recent MGI research examined how the current generation of smart city technologies can perform in a variety of urban settings worldwide. It found that they can improve many quality-of-life indicators by 10% to 30%,” it said.

The report noted that if the city’s potential is maximized, its effects could be felt across the aspects of public health, environment sustainability, living costs, safety, job creation and commuting time.

“We estimate that the market for smart mobility applications could be as large as $70 billion, while opportunities to make the built environment smarter could be worth up to $26 billion,” it said.

“Cities still need to invest in fundamental systems and services, but they can use smart solutions to get more capacity and lifespan out of their infrastructure assets and deliver for their residents in a more effective way,” it said.

Sensors, cameras and smartphones have now allowed the easier collection of real-time data on traffic, air pollution and crime. MGI added: “Analytics systems and mobile apps translate this data into alerts, insights, and tools. This allows users to make better decisions.”

“Various stakeholders can bring different things to the table, whether it is financing, urban planning experience, technical expertise, operational capabilities, or knowledge of the local landscape,” the report said.

It added that the development of these “smart cities” may result in $9 billion to $16 billion worth of savings in the cost of living in the city and produce 1.2 million to 1.5 million new jobs, which is equivalent to 20% to 30% of the labor force in Manila.

The study noted that the emerging popularity of “e-hailing” and “smart office buildings” are prominent examples of the incorporation of technology by companies, which may be applicable to cities.

“Companies operating effectively in this space have identified public problems and come up with digitally enabled solutions, many of which can be introduced quickly and cost-effectively,” it wrote.

Aside from Metro Manila, it also identified Cebu and Davao as some of the midsize cities in Southeast Asia that may eventually achieve the same effect.

“[T]heir financial capacity is typically constrained because of their relatively smaller scale. Large-scale projects to develop entire smart districts could attract private- sector partners,” MGI said. — Denise A. Valdez