Tag: eco-cities

Chilean Eco-Buildings Pioneering Construction Methods

Post author By David South Consulting
Post date 04/10/2022
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By David South, Development Challenges, South-South Solutions

Across the global South, the search is on for new ways to build without extracting a high price from local environments.

More and more people are recognizing the advantages of energy-saving methods like prefabrication. Prefab building techniques involve assembling a structure from pre-assembled parts or modules made in a factory, or transporting a completed, factory-made structure to a site (http://en.wikipedia.org/wiki/Prefabricated_building). Pre-fabrication has many advantages, especially now that information technologies bring precision to the building process. Prefabrication means the construction process can be tightly controlled, helping to avoid waste, time delays, weather problems, or any of the other idiosyncrasies of a building site. It can also allow large numbers of dwellings to be built quickly by maximizing skills and efficiencies in an assembly-line model of production.

In South America, a Chilean architecture company has pioneered innovative methods to build and deploy accommodation for tourists in an ecologically fragile area. The prefabricated wood cabins also use many emerging saving technologies and clever design tweaks to protect privacy when located close together.

Easter Island (Rapa Nui) (http://en.wikipedia.org/wiki/Easter_Island) sits 3,500 kilometers off the Chilean coast and is well known for its iconic, giant head ancient stone statues, or moai (http://en.wikipedia.org/wiki/Moai). Around 3,791 people live on the island – one of the most isolated inhabited islands in the world – which is both a UNESCO World Heritage Site and a popular tourist destination.

Tourism is vital to the local economy and many people make their living from it. Enterprises making money from tourists range from dive shops and craft stores to restaurants and hotels.

The island has had a good connection between tourism and improvements in living conditions, with tangible improvements made since the increase in tourism in the 1960s. Clean water and electricity were provided and a hospital and a school built.

In the past few years, more flights from Peru and Chile have increased opportunities to visit the island and lowered flight times. The island’s only airport is being expanded to further increase the capacity of flights, a project due to be completed by 2015.

But tourist numbers in 2010 declined from 2009 and this has been attributed to ongoing conflicts between Chilean authorities and the indigenous Rapa Nui people over ancestral lands.

Here as elsewhere, the challenge is to balance tourism with the fragile local environment. Any further expansion of tourism will need to sit lightly on the land and respect the rights of the Rapa Nui people.

The brief for the Morerava eco cabins (http://www.morerava.com/) was to provide environmentally sensitive accommodation that uses few local resources. Built by Santiago-based Chilean architects AATA Associate Architects (http://aata.cl/), the cabins were prefabricated in a factory and shipped to the island during 2010.

The architects specialize in industrial, commercial, educational and institutional, residential and interior design. They pay attention to environmental conditions and the use of resources.

The cabins are arranged around an elliptical courtyard reflecting the shape of the island’s flag design. They have an open-plan set-up and are long and skinny, with rooms arranged in a line from end to end. Nine cabins accommodate six people each. Cleverly, they are designed to retain privacy while being close together. Privacy is maintained through a strategic use of window placement. On one side of the cabin, the windows are high, while they are low at foot level on the opposite side. This prevents there being a direct sight line into the next cabin, while allowing plenty of light to stream in.

Having the cabins built on the Chilean mainland avoided using up local vegetation and resources. Easter Island once was covered with a palm forest. But over the centuries of human habitation, the forests were cut down and the island became almost barren.

Propped up on stilts, the cabins hover over the moist grass floor to avoid damage from rot. The roof is sturdy and made from zinc steel.

They use little water and energy to function. Cross-ventilation airs the cabins and avoids mechanical systems like energy-gobbling air conditioners. Electricity on the island is generated from expensive petrol, so any means to avoid using it means a big savings.

With a mild climate, the cabins do not need insulation.

Water is captured from rainfall on the roof and is then drained into a storage tank below the cabins (http://en.wikipedia.org/wiki/Rainwater_harvesting), and hot water is provided by solar heaters placed on the rooftops. This system circulates the hot water without electricity by using a technology called thermosiphon (http://en.wikipedia.org/wiki/Thermosiphon) which exploits the natural phenomenon of heated water being less dense and rising while cooler water flows downward through the force of gravity.

At the other end of the construction spectrum, one of the most notoriously energy-wasting of structures – an office building – has been given a green makeover. Another Chilean pioneer in green architecture is the Santiago headquarters of Empresas Transoceanica (http://www.transoceanica.cl/), a private investment company in real estate, hotels and tourism, agro-industry and logistics. Its new campus HQ – part park, part office building – maximizes light through the building’s long and bulbous shape.

Designed to reduce energy demand while improving work spaces, it favours natural light while avoiding excess heat build up through wooden slats outside the building.

Geothermal energy comes from a well 75 metres below ground. This provides water cooled at 12 degrees Celsius, to cool the building. The building has been built following the strict environmental guidelines laid down in the LEED guidelines (Leadership in Energy & Environmental Design (LEED) – an internationally recognized green building certification system (http://en.wikipedia.org/wiki/Leadership_in_Energy_and_Environmental_Design).

Extensive planning and design work went into making sure the building’s structure, orientation, lighting, insulation and landscaping reduced energy use and need for energy-intensive mechanical solutions. Skylights bring natural light into the building’s public spaces. There are three stories above ground and two stories below providing underground parking.

The landscaped park around the building is actually the roof for the underground parking garage. The whole edifice creates a seamless connection between the building and the greenery and water features surrounding it.

Published: February 2011

Resources

1) Series of photographs and architectural renderings of the Transoceanica headquarters. Website: http://www.plataformaarquitectura.cl/2010/10/28/edificio-transoceanica-arquitectos-2/

2) World Hands Project: An NGO specialising in simple building techniques for the poor. Website: www.worldhandsproject.org

3) Builders Without Borders: Is an international network of ecological builders who advocate the use of straw, earth and other local, affordable materials in construction. Website: http://builderswithoutborders.org/

4) An inspiring collection of prefabrication buildings and the techniques used to make them. Website: http://inhabitat.com/architecture/prefab-housing/

5) Tiny House Design Blog: The blog is full of ideas and plans for making small homes cheaply. Website: http://www.tinyhousedesign.com/

6) Building and Social Housing Foundation: The Building and Social Housing Foundation (BSHF) is an independent research organisation that promotes sustainable development and innovation in housing through collaborative research and knowledge transfer. Website: http://www.bshf.org/

Development Challenges, South-South Solutions was launched as an e-newsletter in 2006 by UNDP’s South-South Cooperation Unit (now the United Nations Office for South-South Cooperation) based in New York, USA. It led on profiling the rise of the global South as an economic powerhouse and was one of the first regular publications to champion the global South’s innovators, entrepreneurs, and pioneers. It tracked the key trends that are now so profoundly reshaping how development is seen and done. This includes the rapid take-up of mobile phones and information technology in the global South (as profiled in the first issue of magazine Southern Innovator), the move to becoming a majority urban world, a growing global innovator culture, and the plethora of solutions being developed in the global South to tackle its problems and improve living conditions and boost human development. The success of the e-newsletter led to the launch of the magazine Southern Innovator.

This work is licensed under a
Creative Commons Attribution-Noncommercial-No Derivative Works 3.0 License.

ORCID iD: https://orcid.org/0000-0001-5311-1052.

© David South Consulting 2022

Global South Eco-cities Show How the Future Can Be

Post author By David South Consulting
Post date 20/03/2022
1 Comment on Global South Eco-cities Show How the Future Can Be

By David South, Development Challenges, South-South Solutions

SOUTH-SOUTH CASE STUDY

The world is currently undergoing a high-stress transition on a scale not seen since the great industrial revolution that swept Europe in the 19th and 20th centuries. Today’s urban and industrial transition involves many more people and is taking place on a greater proportion of the planet. With rapid urbanization comes a demand for middle class lifestyles, with their high-energy usage and high consumption of raw materials.

This is stretching the planet’s resources to breaking point. And as many have pointed out, if the world’s population is to continue past today’s 7 billion to reach 9 billion and beyond, new ways of living are urgently required. Radical thinking will be necessary to match the contradictory goals of raising global living standards for the world’s poor with pressured resources and environmental conditions.

But there are innovative projects already under development to build a new generation of 21st-century cities that use less energy while offering their inhabitants a modern, high quality of life. Two examples are in China and the Middle East.

Both projects are seen as a way to earn income and establish viable business models to build the eco-cities of the future. Each project is seeking to develop the expertise and intellectual capacity to build functioning eco-cities elsewhere. In the case of the Masdar City project in the United Arab Emirates, international businesses are being encouraged to set up in Masdar City and to develop technologies that can be sold to other countries and cities – in short, to create a green technology hub akin to California’s hi-technology hub ‘Silicon Valley’. Masdar City is also being built in stages as investors are found to help with funding. Both projects hope to prove there is money to be made in being green and sustainable.

The Tianjin Eco-city (tianjinecocity.gov.sg) project is a joint venture between China and Singapore to build a 30 square kilometre city to house 350,000 residents.

Tianjin (http://en.wikipedia.org/wiki/Tianjin) is a large industrial city southeast of China’s capital, Beijing. It is a place that wears the effects of its industrial expansion on the outside. Air pollution is significant and the city has a grimy layer of soot on most outdoor infrastructure.

China has received a fair bit of criticism for its polluted cities as the country has rapidly modernized in the past two decades. This sprint to be one of the world’s top economic powers has come at a cost to the environment. In this respect, China is not unusual or alone. Industrialization can be brutal and polluting, as Europe found out during its earlier industrial revolution.

But China is recognizing this can’t go on forever and is already piloting many initiatives to forge a more sustainable future and bring development and high living standards back in line with what the environment can handle.

Sino-Singapore Tianjin Eco-city is the second large-scale collaboration between the Chinese government and Singapore. The first was the Suzhou Industrial Park (http://www.sipac.gov.cn/english/).The Tianjin project came up in 2007 as both countries contemplated the challenges of rapid urbanization and sustainable development.

The project’s vision, according to its website, is to be “a thriving city which is socially harmonious, environmentally-friendly and resource-efficient – a model for sustainable development.”

The philosophy behind the project is to find a way of living that is in harmony, with the environment, society and the economy. It is also about creating something that could be replicated elsewhere and be scaled up to a larger size.

The city is being built 40 kilometres from Tianjin centre and 150 kilometres from Beijing. It is located in the Tianjin Binhai New Area, considered one of the fastest growing places in China.

Construction is well underway and can be followed on the project’s website (http://www.tianjinecocity.gov.sg/gal.htm). It will be completed in 2020.

This year, the commercial street was completed and is ready for residents to move in.

Residents will be encouraged to avoid motorized transport and to either use public transport or people-powered transport such as bicycles and walking.

An eco-valley runs down the centre of the city and is meant to be a place for pedestrians and cyclists to enjoy.

The basic building block of the Eco-city – its version of a city block – is called the Eco Cell. Each Eco Cell measures 400 metres by 400 metres, a comfortable walking distance. Four Eco Cells make a neighbourhood. Several Eco Neighbourhoods make an Eco District and there are four Eco Districts in the Eco-city. It is a structure with two ideas in mind: to keep development always on a walkable, human scale and also to provide a formula for scaling up the size of the Eco-city as the number of residents increases.

It is a logical approach and seeks to address one of the most common problems with conventional cities: sprawling and unmanageable growth that quickly loses sight of human need.

Agreement was also reached on the standards that should be achieved for a wide variety of criteria, from air and water quality to vegetation, green building standards, and how much public space there should be per person.

An ambitious project in the United Arab Emirates is trying to become both the world’s top centre for eco cities and a living research centre for renewable energy. Masdar City (http://www.masdarcity.ae/en/)is planned to be a city for 40,000 people. It is billed as a high-density, pedestrian-friendly development where current and future renewable energy and clean technologies will be “marketed, researched, developed, tested and implemented.”

The city hopes to become home to hundreds of businesses, a research university and technology clusters.

This version of an eco-city is being built in three layers in the desert, 17 kilometres from the Emirati capital Abu Dhabi. The goal is to make a city with zero carbon emissions, powered entirely by renewable energy. It is an ambitious goal but there are examples in the world of cities that use significant renewable energy for their power, such as Reykjavik, Iceland in Northern Europe, which draws much of its energy from renewables and geothermal sources.

Masdar City is designed by world-famous British architect Norman Foster (fosterandpartners.com) and will be 6.5 square kilometres in size.

The design is highly innovative. The city will be erected on 6 metre high stilts to increase air circulation and reduce the heat coming from the desert floor. The city will be built on three levels or decks, to make a complete separation between transport and residential and public spaces.

The lowest deck will have a transportation system based on Personal Rapid Transport Pods. These look like insect eyes and are automated, controlled by touch screens, using magnetic sensors for propulsion. On top of this transport network will be the pedestrian streets, with businesses, shops and homes. No vehicles will be allowed there, and people will only be able to use bicycles or Segway (segway.com) people movers to get around. An overhead light railway system will run through the city centre, all the way to Abu Dhabi City.

“By layering the city, we can make the transport system super-efficient and the street level a much better experience,” Gerard Evenden, senior partner at Foster + Partners, told The Sunday Times. “There will be no car pollution, it will be safer and have more open spaces. Nobody has attempted anything like this.”

Masdar City is being built in stages as funding comes, with the goal of completion by 2016. It hopes to achieve its aspiration to be the most technologically advanced and environmentally friendly city in the world. As for water supplies in the desert, there is a plan: dew collected in the night and morning and a solar-powered desalination plant turning salt water into drinking water.

Electricity will come from a variety of sources. Solar panels will be on every roof and double as shade on alleyways. Non-organic waste will be recycled, while organic waste will be turned into fuel for power plants. Dirty water will be cleaned and then used to irrigate green spaces. Because of the design, the planners hope the city will just use a quarter of the energy of a conventional city.

To keep the city smart and the project on top of developments in renewable energy, the Masdar Institute of Science and Technology (http://www.masdar.ac.ae/) will specialize in renewable energy technology.

The cost for the city was pegged at US $22 billion in 2009.

The chief executive of Masdar – Abu Dhabi’s renewable-energy company – is Sultan Al Jaber. He sees the city as a beacon to show the way for the rest of the Emirate to convert from a highly inefficient consumer of energy to a pioneer in green technology.

“The problem with the renewable-energy industry is that it is too fragmented,” he told The Sunday Times. “This is where the idea for Masdar City came from. We said, ‘Let’s bring it all together within the same boundaries, like the Silicon Valley model (in California, USA).’”

The project needs to gather much of its funding as it progresses. The United Nations’ Clean Development Mechanism (http://cdm.unfccc.int/) is helping with financing. Companies can earn carbon credits if they help fund a low-carbon scheme in the global South. The sultan is ambitious and sees this as a “blueprint for the cities of the future.” It has been able to bring on board General Electric (GE) and the Massachusetts Institute of Technology (MIT) to sponsor the university.

It is possible to visit Masdar City and take a tour (http://www.masdarcity.ae/en/105/visit-masdar-city/) and it is also possible to view online what has been built so far (http://www.masdarcity.ae/en/32/built-environment/).

Resources

1) Center for Innovation, Testing and Evaluation (CITE): Located in Texas, USA, CITE is a fully functioning city with no residents to test new technologies before they are rolled out in real cities. Website: http://www.pegasusglobalholdings.com/test-center.html

2) Digital Cities of the Future: In Digital Cities, people will arrive just in time for their public transportation as exact information is provided to their device. The Citizen-Centric Cities (CCC) is a new paradigm, allowing governments and municipalities to introduce new policies. Website: http://eit.ictlabs.eu/action-lines/digital-cities-of-the-future/

3) Eco-city Administrative Committee: Website: http://www.eco-city.gov.cn/

4) Sino-Singapore Tianjin Eco-city, Investment and Development Co., Ltd. Website: tianjineco-city.com

5) ‘The Future Build’ initiative, a new green building materials portal from Masdar City. Website: thefuturebuild.com

6) UNHABITAT: The United Nations Human Settlements Programme is the UN agency mandated to promote socially and environmentally sustainable towns and cities with the goal of providing adequate shelter for all. Website: http://www.unhabitat.org

This work is licensed under a
Creative Commons Attribution-Noncommercial-No Derivative Works 3.0 License.

ORCID iD: https://orcid.org/0000-0001-5311-1052.

© David South Consulting 2022

New Cities Offering Solutions for Growing Urban Populations

Post author By David South Consulting
Post date 12/11/2021
No Comments on New Cities Offering Solutions for Growing Urban Populations

By David South, Development Challenges, South-South Solutions

SOUTH-SOUTH CASE STUDY

Across the global South, new cities are being dreamed up by architects, city planners and governments, or are already under construction. Two new urban areas being built offer lessons for others in the global South. They both deploy intelligent solutions to the combined demands of urbanization, growing populations and rising expectations.

An eco city in China and a smart city in the Republic of Korea are tackling today’s – and tomorrow’s – challenges.

A joint initiative between China and Singapore, the Sino-Singapore Tianjin Eco-City project (tianjinecocity.gov.sg) – located on reclaimed land some 45 kilometres from the booming Chinese city of Tianjin and 150 kilometres from Beijing – is an attempt to create a replicable model for other cities in China and the global South. Already well underway, with the first phase of construction nearly complete, the Eco-City’s hallmarks include encouraging walking, reducing reliance on private vehicles and aiming to generate 20 per cent of the city’s energy from renewable sources. It is run from the Chinese end by Tianjin TEDA Investment Holding Co., Ltd and in Singapore by the Keppel Group.

It is located 10 kilometres from the Tianjin Economic Technological Development Area (TEDA), a fast-growing high-tech business hub in its own right.

Called an “integrated work, live, play and learn environment,” it is a mix of public and private housing based on the highly successful model developed in Singapore.

The concept of an “eco city” was first raised by Richard Register in his 1987 book Ecocity Berkeley: Building Cities for a Healthy Future. It was to be a place that minimizes inputs of energy, water, and food and outputs of waste heat, air pollution, carbon dioxide, methane and water pollution. Like smart cities, eco cities are taking shape in various forms around the world. Some are applying the concept and principles of an eco city to an existing place, while others are being built from scratch.

The Tianjin Eco-City is a mix of elements designed to make it sustainable in the long-term. It includes an “EcoValley” running through the development as its centrepiece green space to encourage walking and cycling between the major centres of the city. It has the usual urban services – from schools to shops and restaurants – but also, critically, a growing range of business parks to support employment.

Unlike green initiatives in wealthy, developed countries, it is hoped the Tianjin Eco-City will prove a more relevant model for the global South. It has factored in the need to make an eco city pay its way and generate new business and innovations. It is trying to address the pressing urgency of China’s growing population and rapid urbanization, while balancing people’s expectations of rising living standards. As in other countries in the global South, people aspire to a higher standard of living and this needs to be taken into consideration when planning eco cities.

Ho Tong Yen, Chief Executive Officer of Sino-Singapore Tianjin Eco-City, says its aim is “sustainable development packaged in a way that is uniquely Asian.”

He says the project is intended to be “practical, replicable and scalable.”

“Practical at its core is building something that the market can support, something that is affordable given the economic development of the region,” he said. “The idea is that this model must be one that is replicable and scalable in other parts of China. Now, strictly speaking, there is no reason it needs to be just for China – it really might be replicable in other developing countries as well. Our starting point, however, is to find a model that might work for China.

“I think it is still a work in progress – a bold experiment – and it is a long-term experiment. The idea is to create an eco city that can support a population of 350,000 over a 10 to 15 year horizon.

“In some ways it is a city that does not look all that much different from other Chinese cities. But if you look at the subtleties – the building orientation, the renewable energy, the transit oriented developments, the walkability concepts – these are all the elements we built into this project.

“An eco city is not necessarily a science-fiction-like concept; it is something that is very real, very do-able. It looks a lot like a normal city – it is not a special city in a glass dome.”

The explosion in information technologies in the past decade has re-shaped the way cities can be planned, run and developed. The connectivity brought about by now-ubiquitous electronic devices such as mobile phones and the ever-expanding information networks connected by fibre optic cables is giving rise to so-called “smart cities.” These urban areas draw on information technologies to use resources more efficiently and reduce waste, while – it is hoped – better serving the needs of residents. Real-time information can be gleaned to monitor energy use, or traffic congestion, or crime, while constant online connectivity enables the efficient delivery of a multitude of services to residents.

Smart cities vary in their scope and ambition. Some are existing urban areas given a modern upgrade, while others, such as the Songdo International Business District (IBD) (songdoibd.com) smart city in the Republic of Korea, are planned and built from scratch.

Built on 1,500 acres (607 hectares) of reclaimed land from the Yellow Sea in Incheon, Songdo International Business District is being built by Gale International and POSCO E&C of Korea. It is considered one of the largest public/private real estate ventures in the world. Due to be completed in 2017, it will be home to 65,000 people (22,000 currently live there), while 300,000 people will commute in daily to work. Fifteen years in the making and costing over US $35 billion, it is called a “synergistic city” because it contains all the elements necessary for people to live a high-quality life.

Currently 50 percent complete, Songdo IBD is considered one of Asia’s largest green developments and a world leader in meeting LEED (Leadership in Energy and Environmental Design) (https://new.usgbc.org/leed) standards for green buildings. For example, it has the first LEED-certified hotel in Korea, the Sheraton Incheon. These high green standards have led to the United Nations Green Climate Fund Secretariat establishing its headquarters in Songdo, with a slated opening in 2013.

Songdo is “smart” because information technology connects all its systems – residences, buildings, offices, schools, hospitals, hospitality and retail outlets. This includes more than 10,000 Cisco TelePresence units (http://www.cisco.com/en/US/products/ps7060/index.html)– menu-driven video screens – being installed in the residences to connect them to all the services available in Songdo.

It also benefits from proximity to IncheonInternationalAirport – consistently voted one of the best in the world – giving residents quick access to other Asian cities such as Shanghai, Tokyo and Hong Kong. This connection between urban development and a highly connected airport is being called an “aerotropolis.”

Songdo smart city is just one part of a massive regional development plan, using reclaimed land from the sea and marshlands. The residential and business developments are all being linked to IncheonInternationalAirport, which is being positioned as a transport hub and gateway to Northeast Asia – it boasts of being a three-and-a-half hour flight to one-third of the world’s population. The idea is to create a thriving international business hub that is a short flight away from Asia’s booming and fast-growing economic centres.

“The beauty is you are doing everything from scratch – you are using newer building technology, newer systems,” said Scott Summers, Vice President of Foreign Investment for developers Gale International Korea LLC.

“You are not going into a city and ripping up old things and then put in new systems. You have a greater opportunity to install this technology, the backbone (information technology from Cisco), to allow these services and connectivity to work properly because you are laying wires in buildings from the get-go rather than going in afterwards.”

Summers believes it is the high-tech component of Songdo that will set it apart from other cities in the future. Songdo is being built with a combination of innovative sustainable development technologies and the latest in information technologies provided by Cisco.

“That is one of the reasons we are pushing this technology, because it is how a city operates that is important,” Summers said.

“The operation of a city, to do it well, is going to improve the success of it. (To) embed into the development of the city some of the technologies of sustainable development – to put in the pneumatic waste system, grey water system, the co-generation – all of those things are much easier to do on raw land.”

Sojeong Sylvia Sohn, owner of Songdo’s Kyu, a Korean fusion cuisine restaurant, was attracted to Songdo and is banking on its future growth.

Sohn said Seoul’s “existing commercial area was just saturated.”

“Songdo International City in Incheon is the future for the region and early business tenants are coming here for investment purposes. It has uncluttered streets and modern buildings, being an international city – this makes it attractive.”

Resources

1) Eco Cities World Summit: The International Ecocity Conference Series brings together the key innovators, decision makers, technologists, businesses and organizations shaping the conversation around ecological and sustainable city, town and village design, planning and development. Website: http://www.ecocityworldsummit.org/

2) Richard Florida: The Creative Class Group is a boutique advisory services firm composed of leading next-generation researchers, academics, and strategists. Website:http://www.creativeclass.com/richard_florida

3) Global Urbanist: The Global Urbanist is an online magazine reviewing urban affairs and urban development issues in cities throughout the developed and developing world. Website: http://globalurbanist.com/

4) UN-Habitat: The United Nations Human Settlements Programme, UN-HABITAT, is the United Nations agency for human settlements. It is mandated by the UN General Assembly to promote socially and environmentally sustainable towns and cities with the goal of providing adequate shelter for all. Website: http://www.unhabitat.org

5) Eco-Cities: A Planning Guide by Zhifeng Yang. Website: http://tinyurl.com/d26rxdx

This work is licensed under a
Creative Commons Attribution-Noncommercial-No Derivative Works 3.0 License.

ORCID iD: https://orcid.org/0000-0001-5311-1052.

© David South Consulting 2021

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China Sets Sights on Dominating Global Smartphone Market

Post author By David South Consulting
Post date 10/12/2020
No Comments on China Sets Sights on Dominating Global Smartphone Market

By David South, Development Challenges, South-South Solutions

SOUTH-SOUTH CASE STUDY

The rise of smartphones – mobile phones capable of Internet access and able to run ‘apps’ or applications – is the latest wave of the global connectivity revolution. Mobile phones rapidly made their way around the world to become almost ubiquitous – the most successful take-up of a piece of communications technology in history – and now smartphones are set to do the same. The number of mobile phone subscriptions in the world surpassed 6 billion in 2012 (out of a population of 7 billion) and, according to the International Telecommunications Union (ITU), the number of mobile phones will exceed the world’s population by 2014.

Over the last five years, with the increasing popularity of smartphones, the focus of the mobile industry has shifted from voice and messaging to apps and data services.

Smartphones are complex pieces of technology and any country that can develop the capability to make them and innovate is set to make a lot of money.

The high export value potential of designing and making “computer equipment, office equipment, telecommunication equipment, electric circuit equipment, and valves and transistors” was flagged up as a priority for developing nations back in 2005 at a UN meeting looking for “New and Dynamic Sectors of World Trade” (UNCTAD).

At present, smartphones have a long way to go to surpass old-style mobile phones: by the end of 2016, according to Portio Research (portioresearch.com), the number of non-smartphones in the Asia-Pacific region alone will still be bigger than the entire worldwide number of all smartphones. Even so, it’s predicted that by 2016, there will be 555 million active smartphones in China alone, as well as half a billion smartphones in Europe by the end of 2014. By 2013, North America’s smartphones will make up 50 per cent of all mobile phones. All in all, a lucrative market.

The main factor holding back the rise of smartphones is price. Smartphones tend to cost more than a basic mobile phone. But as China gets more heavily involved in the smartphone marketplace with its own smartphone and mobile phone brands, low income consumers will find themselves with a wider choice of affordable and powerful smartphones, each one a mini-computer.

Out of the 10 largest global manufacturers of smartphones, four are Chinese: Lenovo, Yulong, Huawei and ZTE (Gartner).

Huawei (http://www.huawei.com/en/), the world’s biggest smartphone seller (according to research firm Canalys) (canalys.com), has started to move some of its design team to London in the United Kingdom, to better tailor its products for foreign markets. It has revenues each year of US $35 billion.

China’s mobile phone market is vast, accounting for a third of all smartphones sold in the world. Getting a foothold in this marketplace places a company in a very strong position to build the expertise and capital to push into the wider global marketplace. And that is what Chinese brands are starting to do. So far, Chinese exports of branded smartphones make up a fifth of those sold around the world (Canalys).

The big global competitors to date have been South Korea’s Samsung (samsung.com) and the American Apple brand (apple.com). Other large competitors are Canada’s troubled Blackberry and Finland’s Nokia.

To compete with them, popular and successful Chinese brands include Xiaomi (xiaomi.cn), which sells more mobile phones in China than does the American Apple brand, and ZTE (http://wwwen.zte.com.cn/en/).

For years, many of the top global brands have had their phones and the components manufactured in China. This meant Chinese manufacturers were assembling the phones but not benefiting from the high value that can be extracted from being the owner of the brand name and the originator of the innovation and holder of the copyrights and trademarks.

But now China’s Lenovo brand (http://www.lenovo.com/uk/en/), for example, has successfully pulled past U.S. electronics maker Hewlett-Packard (www.hp.com) to become the largest seller of personal computers in the world. It is also selling more mobile phones and tablet computers than personal computers.

Lenovo Chief Executive Yang Yuanqing espouses a two-part strategy to defend market share at home in China while going hard at overseas markets. Lenovo started with so-called emerging markets in Russia, India and Indonesia.

“We have very aggressive plans to explore overseas markets,” Lenovo’s mobile phone division head Liu Jun told China Daily. “We hope the overseas market will contribute more than half of Lenovo’s total smartphone revenue in the long run.”

Xiaomi founder Lei Jun is considered part of a new generation of dynamic Chinese technology leaders. His casual clothing and charismatic public presentations have had some equate him to the late Apple founder Steve Jobs. But Jun is not happy with selling smartphones and instead sees the company’s future in software and that the phones are just a tool to access the software. Xiaomi hopes to make even more money from selling games, running online marketplaces and offering social media.

The Chinese-made smartphone brand Coolpad (http://coolpadamericas.com/) – made by Yulong Computer Telecommunication Scientific Co. – is the third best-selling in the Chinese marketplace, surpassing Huawei and Apple and has global annual revenue of US $1.8 billion, according to Forbes magazine. Sino Market Research found 10.2 per cent of China’s smartphone users own a Coolpad, behind Korean brand Samsung and China’s Lenovo.

Coolpad has succeeded by investing heavily in research and development (R&D) and innovation to make the phones cheap but also powerful.

Innovations include technology that lets users have more than one phone number for the same phone by being able to connect to two different network technologies. The phones also include security and privacy protections that make them popular with businesspeople and government officials.

The Coolpad brand has also been frenetic in launching different models of the phones to appeal to its customers. In 2012, it launched 48 different models, selling for between US $50 and US $500.

Coolpad was launched in 2012 in the US as part of the company’s global expansion plans.

China has placed innovation at the core of its economic development policies. China increased its R&D spending in 2009 to US $25.7 billion, a 25.6 per cent rise over 2008, according to Du Zhanyuan, vice minister of the Ministry of Science and Technology. In 2011, China surpassed South Korea and Europe in total patents filed and was in a neck-and-neck race with Japan and the United States.

China now boasts twice as many Internet users as the United States, and is the main global maker of computers and consumer electronics, from toys to games consoles to digital everything.

China is also on course to become the world’s largest market for Internet commerce and computing.

The drive to change and transform China’s global economic role was promoted in 2011’s Beijing International Design Week (http://www.bjdw.org/en/), with its theme of transforming “Made in China to Designed in China.”

Published: September 2013

Resources

1) iHub Nairobi: iHub – Nairobi’s Innovation Hub for the technology community is an open space for the technologists, investors, tech companies and hackers in the area. This space is a tech community facility with a focus on young entrepreneurs, web and mobile phone programmers, designers and researchers. Website: http://www.ihub.co.ke/

2) Venture Capital for Africa: Venture Capital for Africa (www.vc4africa.biz) is the continent’s leading founder’s network, the largest and fastest growing community of entrepreneurs and investors building promising companies in Africa. Website: https://vc4africa.biz/

Red Dot: The red dot logo stands for belonging to the best in design and business. The red dot is an internationally recognized quality label for excellent design that is aimed at all those who would like to improve their business activities with the help of design. Website: http://www.red-dot.de

C3: C3 offers product design and product engineering services in Shanghai, China. Their strong point is managing innovative design processes from scratch (market research) until production: a one shop service: Website: chinacreativecompany.com

North Korea Tech: North Korea Tech is dedicated to covering and collecting information regarding the state of information technology and related industry in North Korea. You can expect to find articles related to Internet connectivity in the country (yes, it does exist), North Korea’s use of technology, and the country’s centrally-controlled and heavily-censored mass media. Website: http://www.northkoreatech.org/

ISSN 2227-3905

Note on story: Very few outside of China in 2013 were talking about this topic, let alone the increasing market share of smartphone manufacturer Huawei. This was one of many stories to result from a research trip to China. For the keen-eyed, try and spot the Huawei logo in the accompanying photo taken in Tianjin.