new asian capitals

Here Are New Capitals Emerging in Asia

Manila is the most densely populated city in the world, and Jakarta is also drowning – literally. Due to flooding, dirt and traffic chaos, the Philippine and Indonesian governments are parting ways with their previous capitals. A view from space shows how Manila’s successor is emerging.

“Economy from above” is a collaboration between WirtschaftsWoche and LiveEO. This is a translation of the original article written in German by “Jannik Deters“. Access the original article here.

Again, the water stands in the streets. The overflowing Java Sea severely damaged houses and neighborhoods in Jakarta at the beginning of December. This is not a surprise. Large parts of seaside North Jakarta and almost half of the entire city are below sea level. And it’s rising. The governor says dikes are the solution. But that won’t be enough. The north could be flooded by 2050 if the experts’ calculations are correct.

That’s why Indonesia is not only adding to its by far most important center for business and jobs – the dikes – but also taking something away from it: the status as the capital. The administration will move in the coming years. This is a reaction to two unfortunate situations: geographical and demographic.

For Jakarta is numerous and densely populated, crowded, and hardly passable. Only the Tokyo metropolitan area has more people. LiveEO’s exclusive satellite images illustrate the sprawl of the city, whose metropolitan area is now home to more than 30 million people.

center represents the urban area of Jakartacenter represents the urban area of Jakarta
Jakarta, Indonesia
03.05.1989 (left picture): At the end of the 1980s, the densely populated area in the center represents the urban area of Jakarta. Even then, about eight million people lived in the capital.

18.07.2021 (right image): The population will grow to about eleven million people in a good 30 years, but the change in the outer areas is even more pronounced. Where there were still many green spaces in 1989, there are now houses and apartments for the far more than 30 million inhabitants in the metropolitan area.

City planners, mayors and national governments have to look for alternatives on how to equalize the masses of people. Role models for relocations and newly built cities exist precisely in the Asian region, where population growth is particularly high and the rural exodus is as pronounced as in many parts of the world. Malaysia moved its administration in 2003, Myanmar in 2006, and now Indonesia and the Philippines under the controversial head of government Rodrigo Duterte. Some time ago, he issued the catchy motto “Build, build, build!” This includes not only a new airport for Manila, but also infrastructure improvements that will benefit the population – and New Clark City.

There, on the site of a former U.S. military base, the new capital is being built.

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Duterte’s predecessor had already pushed the idea of a green, livable city. But in 2016, when the groundbreaking ceremony took place, there was still no talk of a new capital. For years, there were various proposals. Even an Australian businessman ventured forward. New Clark City was not chosen until 2019. The new administration building stands next to the sports facilities.

It is unclear exactly which ministries will be relocated and when. However, the change of location is likely to be convenient for many politicians and civil servants. They, too, need a lot of patience in Manila’s city traffic.

manila philippines 1990manila philippines 2021
Manila, Philippines
25.03.1990 (left picture): At the beginning of the 20th century, Manila was planned for 800,000 people. Almost 100 years later, 9.6 million people live in the metropolitan area.

03.05.2021 (right image): No area in the world is as densely populated as Manila. The patterns of the images are similar, but on the more recent one, the loamy and earthy areas that indicate still undeveloped land have disappeared. Where there were huge green spaces in the northwest in the earlier picture, the new international airport is now being built.

It is likely to be many years before the move is complete. Until then, companies from all over the world are doing business with the new construction capital project. New Clark City is not simply an alternative location to curb congestion in Manila, but also a lure for investors. International and smaller companies from the USA, Sweden and Japan have taken on contracts in New Clark City. They are building transportation networks, constructing roads and securing water and energy supplies.

The Duterte government is urgently dependent on foreign and private-sector support. It is relying on a mix of private and public funds. In 2020, the head of the Philippine Development Authority (BCDA), Vivencio Dizon, enthused that the project would be so transparent and open that it would be a true model for a public-private partnership.

But the Philippine state has fallen into a deep Corona recession. Gross domestic product plunged by ten percent in 2020. The long distances and poor transport links were exacerbated during the lockdowns. Alexander Hirschle of Germany Trade & Invest, Germany’s foreign trade agency, wrote in his latest country report, “Some companies had therefore resorted to providing sleeping and eating facilities for workers on company premises.” Duterte’s infrastructure projects, meanwhile, did boost the construction sector again. But the president’s “Build, Build, Build!” initiative suffered during the pandemic, he said.

Well before Corona, the World Bank concluded in a 2017 report that New Clark City could have quite a salutary effect on the country’s economy: Because jobs and business were so concentrated in Manila, there was a lack of competition. This only exacerbates the metropolis’s overcrowding and congestion.

Jobs are thus to be created in New Clark City. It remains to be seen whether, for example, poorer sections of the population from the vulnerable areas of Manila near the water will be able to leave their surroundings at all and afford the orderly, organized city. It is a dilemma: Those who live in particularly confined spaces in precarious conditions, and possibly also in locations threatened by water, are likely to have the hardest time finding a job and a home in the new environment.

This also applies to Jakarta. Indonesia is the largest economic power in Southeast Asia. The former capital has the decisive share in this. But traffic chaos, flooding, and pollution are also major problems there. According to various estimates, 20 to 40 percent of the area is already below sea level. The island of Java, to which Jakarta belongs, is home to 60 percent of Indonesians. They contribute more than half of the gross domestic product. President Joko Widodo wants to redress this imbalance, which is reflected in the distribution of income.

To do this, he has set up a $34 billion project.

Kalimantan on the opposite island of Borneo. Share of total population: six percent. Share of Indonesian GDP: eight percent. There, in the east of Kalimantan province, a good 56,000 hectares of forest are to be cleared in order to build the new capital. A name has not yet been given. Unlike in the Philippines, the state will only pay for one-fifth of the investment. Ten billion dollars alone will come from the United Arab Emirates.

30 percent of Borneo’s forests have already disappeared in the past 50 years, in favor of the paper industry and palm oil plantations. But Widodo has arguments for the new construction that never apply to Jakarta: There is a “minimal” risk of flooding, earthquakes, tsunamis, and volcanic eruptions.

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