AS most of us are aware, during the course of history, cities play a vital role in facilitating the process of economic growth, social development and technological innovations.
Cities and urbanisation have been associated with economic and social progress, the promotion of literacy and education, the improvement of the general state of health, greater access to social services, and cultural, political and religious participation. Cities have been the engines of growth and incubators of civilisation and have facilitated the evolution of knowledge, culture and tradition as well as industry and commerce.
The 21st Century is a century of cities. Cities throughout the world are undergoing dramatic changes due to rapid urbanisation and advancement of science and technology. This century will provide greater challenges with far more complex problems, as more people will live in cities especially in the developing countries.
In 1990 there were 1.5 billion people living in the cities equivalent to 35% of total population and the United Nations has projected that the urban populations of the developing countries will triple to 4.4 billion by year 2025.
In Malaysia, the percentage of urban population has increased from 51% in 1991 to 59% in 2000. It is projected that 24 million people (71.4%) will live in our urban centres in year 2020.
Today, globalisation and the borderless world will further enhance the role of cities in the growth of national economy. With the advancement of technology, especially in the era of New Economy, Information and Communication Technology (ICT) is the catalyst that powers the transformation of the traditional city economy into a global economy where capital, goods and services flow freely. It promotes wealth creation through the culture of risk taking and complemented by people’s creativity through knowledge and ideas rather than just physical and financial resources.
By virtue of huge capital investment being put to cities, it is highly possible that most cities are able to adapt to the needs of the New Economy through the extended investment in human resource development, education and research and development.
As I just mentioned, local or city economy contributes significantly to the national economy as the majority of population live in urban areas. Local governments have graduated from a mere provider of basic services to creating wealth of the city and facilitating economic development.
For the city economy to remain competitive and sustainable in the globalised economy, a city has to be innovative and attractive to investments so as to bring prosperity to the citizens and also contributes to the growth of the national economy. City government’s should become financially more autonomous and less dependent on Federal government in creating wealth for the city.
Metropolitan Kuala Lumpur is the fastest growing economic region in our country. Within this region that covers the Klang Valley and the upper half of the Langat Valley, the city of Kuala Lumpur dominates a conurbation of urban centres. Kuala Lumpur is the heart of the metropolis, which also includes the KL International Airport (KLIA), now handling 14 million passengers per annum and a seaport, which has become increasingly significant to the city’s growth. Kuala Lumpur is therefore the most important gateway to the nation.
The country’s core urban functions are located within the City of Kuala Lumpur. Thus the headquarters of transnational and multinational companies, top-end five-star hotels and shopping outlets, recreational and entertainment centres, as well as specialised training facilities, professional services and specialist medical services are all located in the city.
Kuala Lumpur also benefits from its proximity to the Multimedia Super Corridor (MSC), the centre of the New Economy, by providing complementary high-end services in finance, shopping, entertainment, housing, education and recreation.
The total current employment in Kuala Lumpur is estimated around 838,400. The tertiary or service sector forms the largest component in the employment structure accounting for 83% of the total. The high employment to population ratio (59%) in the city in comparison with the rest of the metropolitan region (31%) and the country as a whole (40%) indicates positive inward net commuting of workers into the city.
The Eighth Malaysia Plan indicated that the Gross Domestic Product (GDP) for Kuala Lumpur (at purchasers’ value in 1987 prices) has increased from RM21.157mil (1995) to RM25.968mil (2000), an average annual growth rate of 4.2%.
The per capita GDP for Kuala Lumpur during the period 1995 to 2000 rose from RM22.799 to RM30.727, an average annual growth rate of 6.1%. The per capita GDP for Kuala Lumpur was more than twice that of the national average.
Poverty line income of RM510 (US$134) monthly household income is used to calculate the incidence of poverty in Malaysia. Kuala Lumpur’s poverty rate has increased from 0.5% in 1995 to 2.3% in 1999. However the present rate is much lower than the overall national rate of 7.5%.
For the last two decades, the city has shown significant growth in property development. There is a tremendous increase in the commercial– office, hotel, shopping and MICE (Meeting, Incentives, Convention and Exhibition) – floor spaces from 63 million sq ft in 1980 to 238 million sq ft in 2000. The number of hotel rooms has increased from 7,050 in 1980 to 26,144 in 2000, an increase of 270%. The number of housing units has also doubled from 169,780 in 1980 to 328,205 units in 2000.
According to the property market report in 2001, the total number of property transactions declined 8.4% compared to the year 2000. However the market value of the properties transacted in the last 10 years has increased tremendously. Property values in the city have greatly appreciated in the last 10 years.
The increase in capital value of houses are significant in primary areas such as Taman Tun Dr Ismail and Bangsar where double-storey terrace houses priced RM190,000 to RM267,000 in 1990 has gone up to RM500,000 and RM600,000 in 2000. Values of other types of properties such as shops, bungalows, semi-detached houses and vacant land with development potential have also appreciated.
The city has many interesting and unique features to offer to tourists. Its multi-racial population with variety of cultural ceremonies, traditions, special blend of food, etc, makes Kuala Lumpur a unique city to visit. Kuala Lumpur is a haven for those who love shopping. Business and conference tourism has expanded in recent years and is becoming a very important component of the industry.
MICE participants and business tourists are high yield tourists, usually spending more per day than leisure tourists. The MICE industry generates income for many related business activities including the hospitality sector, airlines, freight forwarders, contractors and suppliers of exhibition materials and entertainment. The number of MICE events and participants has been growing steadily in recent years and receipts generated from MICE in Malaysia in 2000 amounted to RM1,164.7mil, almost 7% of total tourism revenue for that year.
The informal sector plays an important role in the socio economic life of the residents of Kuala Lumpur and has a significant impact on the well-being of the city. There are about 35,000 licensed hawkers operating in Kuala Lumpur, 30% of them are located mainly in markets, hawker centres, attachments outside buildings, kiosks and secured stalls.
Besides being sources of livelihood for the thousands of people who are involved in this sector, it is also an important way of life of the Malaysian society.
In 1998 there were 54,000 people involved in the sector, an estimated 6% of the employment in the city. There is an increase in the proportion of the people involved in the informal sector in relation to the total employment in business activity in the city over the last decade.
A conducive physical environment is a prerequisite to attract investors, developers and entrepreneurs to the city. Kuala Lumpur for the past two decades has invested a lot of resources to improve its physical environment.
Improvement in the provision of ICT infrastructure in the last 10 years concurrent with the development of MSC has turned Kuala Lumpur into an information-rich city, comparable to other world-class cities. The efficient and effective information infrastructure of the city and its surrounding has provided channels for electronic traffic, redefined/ improved lifestyles and reinvented work and leisure.
An efficient and integrated transportation system provides maximum mobility for people and goods. The overall transportation strategy of the 1984 Kuala Lumpur Structure Plan (KLSP 1984) is to have a modal shift from private to public transportation mode. The three light rail systems (STAR, PUTRA and Monorail) and the Express Rail Link, linking the KLIA station with KL Sentral, have been almost successfully completed.
The length of public streets has increased by two fold through the improvement of the road networks. Many of the roads proposed under the KLSP 1984 have been implemented and completed (23 new roads and 21 major road improvement projects).
Major roads in the city centre and its outskirts have been improved to complement the rail networks. Missing linkages have been identified and constructed and traffic bottlenecks eliminated through upgrading intersections and junctions.
Transport demand management techniques such as car parking management where rates are reviewed and roadside parking are eliminated to reduce traffic entering the city centre have been implemented to increase public transportation usage. Various measures were implemented to improve city centre traffic circulation including the adoption of one-way traffic system, reduction of road width and widening pedestrian walkways as means of discouraging private car usage.
A computerised traffic monitoring system through central remote control, which monitor various vital junctions and areas in the city has been developed.
A traffic information system which will provide travellers with information such as traffic condition, road diversions or new directional flow and public transport information in the radio, television and the Internet has been adopted.