Don’t panic Beyond Malthus: Managing growth An interview with Sustaining population in developing Hans Rosling growth world cities Page 8 Page 16 Page 20 INSIGHT The global infrastructure magazine / Issue No. 6 / 2014 Population With a special feature on Asia Pacific’s infrastructure market he link between shifting demographics and infrastructure is undeniable. In the next 50 years, three billion more T 1 people will be added to the global population, a large number of whom will live in cities within the developing world. The demand for infrastructure to support these new global citizens will be incredible. At the same time, the demographics of the population are rapidly shifting, creating deep complexities for governments and infrastructure planners. By 2065, for example, more than a quarter of all people living in the developed world will be over 65; more Foreword than one in 10 will be over 80 years of age.2 1, 2 http://esa.un.org/wpp/unpp/panel_indicators.htm © 2014 KPMG International Cooperative (“KPMG International”). KPMG International provides no client services and is a Swiss entity with which the independent member firms of the KPMG network are affiliated. The pressures this will create on social and population. In the articles that follow, KPMG emerging across the region. Whether it is health infrastructure, and on the tax base, infrastructure professionals from around the frontier countries such as Myanmar and will be enormous. world talked to demographers, government Mongolia, energy market reforms in Japan In the less and least developed countries, leaders, infrastructure planners and developers or investment opportunities in China, this population growth will combine with rising to bring together a comprehensive view of report provides deep insight into the markets affluence, better access to healthcare and how these game-changing demographic and issues that matter. education, massive urbanization and gains shifts are influencing the way infrastructure We therefore hope this edition provides in productivity to shift the demographics is planned, prioritized, funded, operated and governments, planners and infrastructure dramatically and, in doing so, put enormous maintained. players with some new perspectives and strain on the existing infrastructure and the This edition of Insight also contains a practical advice for managing the difficult funding capability of governments and their Special Report on Asia Pacific, a region changes ahead. Moreover, we hope that supporters. at the center of the demographic shift it starts the conversation in government Clearly, population and demographics now underway. Within this section, KPMG corridors around the world about the need matter. That is why we have focused this infrastructure leaders explore some of to rethink our approach to infrastructure. edition of Insight on the challenges surrounding the biggest challenges and opportunities There is no time to waste. 1, 2 http://esa.un.org/wpp/unpp/panel_indicators.htm © 2014 KPMG International Cooperative (“KPMG International”). KPMG International provides no client services and is a Swiss entity with which the independent member firms of the KPMG network are affiliated. Contents 08 16 20 4 Around the world in infrastructure 22 Planning cities as if people really 30 Talking transport: How leading mattered cities are responding to shifting 6 Up front An interview with Hugh Barton, former populations A vision for a beautiful world: Director of the World Health Organization A roundtable discussion with David Prout, Taking a quantum step Collaborating Centre for Healthy Urban Director General of the UK’s HS2 high-speed rail Environments and current Professor Emeritus of 8 Don’t panic scheme, Desmond Kuek, CEO of SMRT & Planning, Health and Sustainability, University Anton Valk, former Chief Executive of Abellio An interview with Hans Rosling, of the West of England Professor of International Health 34 Building sustainable cities 24 An app for that: Expanding at Sweden’s Karolinska Institute An interview with Pedro Miranda, Senior VP and co-founder of Gapminder infrastructure access and efficiency and Head of the Global Competence Center for with technology Cities at Siemens In this issue: Population An interview with Paul Schindler, Global Urban Matters Lead, SAP AG 36 Creating sustainable communities 12 Blame it on the boomers: Who will A roundtable discussion with Meg Davis, fund infrastructure over the coming 26 Powering up development in VP of Development at Waterfront Toronto & decades? rural Africa Navin Raheja, CEO of Raheja Developers in India An article by Bernard Salt, founder and Head of An interview with Daniel Rae, founding the KPMG Demographics Group, with a response Trustee and former Chair of the North West 38 Harnessing renewal to enhance from Stephen Beatty, America’s and India Head Zambia Development Trust livability of Global Infrastructure An interview with Marilyn Ball, Chief of 28 Feed the world: Invest in agricultural Planning and Infrastructure Services for the 16 Beyond Malthus: Sustaining infrastructure City of Brampton population growth A roundtable discussion with Dr. Arif Husain, An interview with Gary Gardner, Chief Economist at the United Nations World 40 Developing social infrastructure in a Senior Fellow at the Worldwatch Institute Food Program, Dr. Wang Yongchun, Agricultural turbulent world Information Institute, Chinese Academy of 20 Managing growth in developing A roundtable discussion with Agricultural Sciences & Ian Proudfoot, KPMG in Dr. S.V. Subramanian, Professor of world cities New Zealand Population Health and Geography at Harvard An interview with Rahul Asthana, former University’s School of Public Health & Head of the Mumbai Metropolitan Region Dr. Mariana Arcaya, urban planner and Social Development Authority Epidemiology Postdoctoral Fellow at Harvard University’s School of Public Health © 2014 KPMG International Cooperative (“KPMG International”). KPMG International provides no client services and is a Swiss entity with which the independent member firms of the KPMG network are affiliated. 30 44 64 Spotlight: Asia Pacific’s 58 Reforming Japan’s energy market 72 UK’s Electricity Market Reform infrastructure market An interview with Nobuo Tanaka, former By Anurag Gupta, KPMG in the UK Director General of the International 44 The sophistication of Asia Pacific: Energy Agency and former Director General 74 Securing the future of UK rail: Turning On the cusp of a golden age at Japan’s Ministry of Economy, Trade and smart technology risk into reward Industry By Charles Hosner, Alejandro Rivas-Vasquez 46 Open for business: Australia’s 60 Fostering positive population & Cornelius Namiluko, Cyber Security, KPMG vibrant infrastructure market in the UK growth in Asia: The ADB and An interview with Sir Rod Eddington, former Chair of Infrastructure Australia multilateral banks 76 Global diary An interview with WooChong Um, Officer-in- 48 Singapore pivots its economy to Charge of Regional and Sustainable 78 Bookshelf maintain growth Development at the Asian Development Bank 50 Energy security in the ASEAN Insights block: Myanmar takes center stage An interview with Ken Tun, CEO of Parami 62 Infrastructure’s wicked problem Energy By John Kjorstad, KPMG in the UK 52 Indonesia: An emerging 64 Emerging trends, markets and infrastructure opportunity ideas that can change the world of 54 Asia’s ‘frontier markets’: infrastructure Infrastructure opportunities A roundtable discussion with KPMG’s Global Infrastructure leaders: Nick Chism, James in Mongolia and Myanmar Stewart, Stephen Beatty & Julian Vella 56 Financing China’s urbanization 68 Integrating India’s infrastructure: An interview with Professor Sun Jie, The Adani Group shares the secret Secretary-General of the Public-Private Partnership Research Committee within the of success Public Finance Academy of China’s Ministry An interview with Gautam Adani, Chairman of of Finance the Adani Group © 2014 KPMG International Cooperative (“KPMG International”). KPMG International provides no client services and is a Swiss entity with which the independent member firms of the KPMG network are affiliated. Around the world in infrastructure NORTH AMERICA Shore and the downtown core, Also in British Columbia (BC)… expansion, which has suffered a while Edmonton’s US$1.8 billion number of delays, will increase BC is considering options for the project will create more than 13 the airport’s capacity to 29 million replacement of the George Massy kilometers of new lines, including passengers per year by 2030 and Tunnel, which carries more than the construction of a new bridge to 50 million by 2045. The project 80,000 vehicles into and out of and a 350-meter tunnel.3,4,5 will include the construction of a Metro Vancouver every day. Public 200,000 square meter terminal as and stakeholder consultations well as aprons, asphalt runways, are expected next spring with a freight terminal and car parking. construction expected in 2017. A Santiago already accounts for recent report by TransLink, the nearly 70 percent of Chile’s airport Greater Vancouver Transportation passenger traffic.15,16 Authority, has suggested that a tolled eight-lane bridge be constructed to replace the current four-lane tunnel. The report stated that the tolled bridge option appeared to manage the growth in auto traffic demand California HSR gets back and could potentially prolong the on track Thinking longer-term in NYC useful capacity of the bridge beyond 10,11,12 It seems that California’s High- The long-awaited replacement of the 2045. Speed Rail (HSR) project may be Tappan Zee Bridge over the Hudson about to get a much-needed boost. River kicked off in 2013. The original LATIN AMERICA Democrats in that State have bridge – built at a cost of just US$80 proposed that the project be funded million in 1955 – had seen traffic with proceeds from California’s rise well above the bridge’s original AFRICA carbon cap-and-trade program. design capacity while demand forced Should the proposal be accepted, authorities to extend the life of the it would give the California HSR bridge past its expected 50-year Authority the ability to leverage the lifespan.