Digital Foundations: The Path to People-Centred Smart Cities

Urban growth to 2050 will be driven by cities in African and Asian countries, accounting for over 2.2 billion of the additional 2.5 billion urban residents expected. While cities in these regions have substantially lower emissions per capita than high-income counterparts, for the world to achieve net-zero by 2050 urban development in low- and middle-income countries (LMICs) must follow a different path than historic emissions trajectories of high-income countries. At the same time, these cities are often at the forefront of facing climate-related risks, including storm surges, heat stress, extreme precipitation, flooding, and landslides.

Rapid urbanisation and climate change hinder cities’ ability to effectively plan and invest in essential services and infrastructure. This is true for both megacities as well as rapidly growing intermediary cities. In response, many local governments are turning to digital solutions to fill critical data gaps, advance climate action, and enhance the accessibility, affordability and reliability of essential urban services.

This report takes stock of the trends shaping smart city deployments across Sub-Saharan Africa, South and Southeast Asia. The opportunity for mobile operators is quantified through total addressable market forecasts for eight countries — Egypt, Nigeria, Kenya, South Africa, India, Indonesia, Malaysia, and Pakistan — and across regions. The report profiles leading use cases, mobile operator engagement and positioning, and reviews in detail the policy and technology context.

Mobile network operators are central to delivering smart city solutions, particularly in LMICs where rapid digital adoption is driving faster deployments and scale. Major technological changes have shifted the bounds of what is possible for urban solutions, notably, 5G and network slicing, Low Power Wide Area (LPWA) connectivity, digital payment platforms and developments in artificial intelligence (AI). Between 2020 and 2024, smart city IoT connections increased from 173 to 271 million, and will increase another 222 million to 2030. Across the four regions reviewed this equates to a cumulative revenue opportunity of $38 billion.

Smart city approaches create options to advance inclusive development and climate resilience. While the risk of smart city projects becoming high-cost, high-tech, elite enclaves detached from wider national development challenges is present, smart city solutions – when thoughtfully applied – can be transformative. Accelerated efforts are needed to close the digital divide and ensure smart solutions are inclusive and respect data privacy. Broad inclusion also safeguards vulnerable residents and enhances the overall resilience of cities. To realise the potential gains, it is important to go beyond the hype and big project announcements to focus on specific interventions and use cases and rigorously evaluate their development and climate impact.