Global Cities : A vicious economic network

Photos courtesy: Associated Press

Authors: Anuj Chaudhary & Deepak Hudda

Has our aspiration to be a part of "global cities" network based economy turned against us?  Our metro cities like Mumbai and New Delhi, once the economic engines and magnet for job seekers have suddenly become a nightmare that no one wants to have. 

This blog will take you through the vulnerabilities of the present economic model that is based on an archipelago of global cities. These global cities are important economic centres that bring together a large part of global economic activities and their key components. The current Covid-19 pandemic shows us the disadvantages and limits of this global economic system and reminds us to rethink the contemporary global economic system, which implies a strong interdependence between the global metropolitan poles where all economic concentration has been built up, with potential reorganisations in the production of wealth and employment that seem to elude us so far. 

The third globalization is synonymous with interdependence in terms of production, the value chain, the flow of goods, knowledge, or people. On a large scale these flows take place between major financial centers worldwide. These so called "world cities" are the motors of today's global economy. The least developed countries have followed the same path, as did their western counterparts, in order to ensure their integration into this urban globalization or metropolisation of the world economy. 

Folks, I am not a geographical economist but after a detailed discussion and exchange of our views on the current circumstances with a France based geographical economy territorial development analyst Deepak HUDDA, it's learnt that the western countries present themselves as a unique model for development and the developing world also accepts it without giving a second thought. Therefore in order to ensure their complete integration into this economic system dominated by metropolises, they have too created a group (whether big or small) of metro cities in their respective countries. Hence, this interdependence is reinforced. And with it, the entire system becomes more vulnerable in the event of a disruption irrespective of its nature, be it a natural disaster or a man made one. This transformation in the economic system (with its production and distribution tools) has also changed the relationship between the urban and the rural territories. Due to inequalities, originating from this form of urban economic development, people from rural areas had to settle in urban centres to be part of this 21st century’s globalised world. Which has totally rendered them economically dependent on this system. In case this system fails, it would not only have repercussions on city-dwellers but their limits could be seen extended deep into the rural areas. This urban globalisation has weighed heavily on rural development thus creating inequalities and power relations, by overestimating the relative weight of metro cities, between these two territorial areas. 

Contemporary globalisation only favours the large cities in the world as centers of employment, innovation and wealth creation. That being the case, this wealth has not been distributed evenly. So the socio-spatial fragmentation has become a conspicuous reality within the cities themselves. These phenomena have completely reshaped the population distribution, its needs, and the forms of urbanisation hence, the concentration of economic activities. Every country is racing to get the maximum number of megacities within its borders thus representing itself as the winner of the economic globalisation and at the same time the attractive destination for foreign & domestic investments. By making themselves as less diverse and more interdependent as possible, so much so that they have never been so exposed to economic vagaries in the event of a crisis. However, being part of the same globalization, not all cities have equally benefited from the economic globalisation thus are not equally capable of coping with these crises and the same is true at the local level, not all populations are equipped with the necessary means. The pandemic of Covid-19 clearly showed that social inequalities in urban areas had a diverse impact on the death rate according to the richer or poorer areas of a city. The current form of the world economy and then the overall urban organisation has proven itself ineffective in dealing with the current health crisis. The very principles of this economic system could not do anything to anticipate such a crisis which has paralysed the whole system. Precisely, because of the current economic theories that do not advocate investing in researches which have no immediate and maximum returns. Right now, the form of globalisation we have, its organisation is such that it would impact the whole world. And this form is tying the whole humanity in a single string. It is completely detached from social and political relationships. It’s the economy that decides how it wants to organise not us.  

While concluding this, we can say that the current situation makes us to rethink these economic organisations. We understand that putting everything on the same principle can have unimaginable consequences. We will have to reorganise the pattern that we have so far used for the integration of the world’s economy by making it totally focused on metropolitan poles. We need to diversify it and give the countryside its dues. It’s complete dependence and integration with the metropolitan economy worsens the situation. If it were somewhat detached and autonomous from the city centered economy, this could not only have helped the urban economy but also the rural migrant workers who go to the urban centers for employment would have been in a far better situation. So, we need a different and more holistic approach to integrate the rural economy into the world economy and have to harmonise the relationships between urban and rural regions. The diversification of economic production and the relocation of the value chain are the important aspects to be debated. The theory of redoing or following the same model for everything as before and after a crisis should be challenged. The hesitation and profit seeking mentality have made us ignorant towards not dealing with unprofitable things and not investing in researches to anticipate the future uncertainties and hence be prepared for them in advance, will always prove catastrophic. Not totally neo-liberal policies that seek to maximise the profits but the ones that respect the environment and take into account the preoccupation for our future generations, will define the world of tomorrow and the global cities of tomorrow.