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Could global forces be reinventing and redirecting how construction should be envisaged in the face of global urbanization?

Posted By IRMSAInsight, 13 February 2015

“Our planet has urbanized rapidly over the past six decades or so. In 1950, 70% people worldwide lived in rural settlements and 30% in urban areas. Today, 54% of the world’s populations live in cities. According to the UN, 60% of the world’s population will live in cities by 2030, and by 2050 we will reach 70%--the inverse of what was true just a century before” per an article by Kathryn Harb, 12th January 2015. Even more intriguing is that 90% of these will be in ASIA and AFRICA.

This unprecedented growth of urban centers will bring enormous opportunity for the construction industry. It has been noted that 65% of the world’s construction in the next 10 years will be in these two continents being the emerging markets. Therefore 440 of the world’s top 600 cities will be from emerging markets with China claiming 100 of the best cities by the next 15 yrs.

But, where we are building cities is leaving us more exposed to weather. The last several decades show a clear, overall trend of increasing worldwide catastrophes. Today, risk resilience is typically not considered when contemplating investment decisions. The resilience of these emerging cities to adverse weather created by too much urbanization has to be the number one risks all investors must now look out for.

Risk considerations for global investors:

1.     Was building constructions done with resilience in mind in these emerging cities as this would not only be more socially responsible, but more financially rewarding

2.     Natural disasters are yet to come—in both human and financial terms—to save millions of lives, billions of dollars, all while creating a more sustainable and resilient economy in this global and rapidly urbanizing world, the way in which construction is done and buildings erected has to be way more resilient more so for the coastal cities in Asia and Africa.

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