Smart City Index 2020

Every city faces many economic, social and environmental challenges. Therefore, effective solutions are needed to mitigate these problems in order to ensure the best possible quality of life for city dwellers. Increasingly, technology is being used to influence whether a city is smart. Currently there is no single common definition of a Smart City. The term can be understood in different ways, but it is most often identified with a city, in which public issues are addressed using information and communication technologies (ICT). These technologies play a significant role in supporting cities, making them a better place to live by enabling better energy use, improving transport and introducing smart services, such as mobile apps. All these aspects should form an integral system involving citizens in the development process.

The term Smart City has been around for a long time and more and more cities are being recognized as “smart”. For this reason, there was a need to compile lists of the smartest cities. One of the most popular rankings is the Smart City Index.

Smart City Index

The Smart City Index (SMI) is a report first produced in 2019 by IMD (The Institute for Management Development, which is one of the world’s top business schools located in Switzerland) in collaboration with Singapore University of Technology and Design (SUTD). The second edition was published in 2020 also by IMD and SUTD.

In the context of the Smart City Index, a “smart city” continues to be defined as an urban area that applies technology to enhance the benefits and reduce the shortcomings of urbanization for its residents. The research is primarily based on the perceptions of those, who live and work in the city in order to best capture how they perceive the living conditions changing due to information technology. The ranking includes 109 cities. A survey of 120 residents was conducted at each site to assess existing infrastructure and technological equipment and available services in five key areas, i.e. health and safety, mobility, activities, opportunities and governance. The positioning of cities was also influenced by the Human Development Index (HDI), which is a synthetic index based on the average of indices concerning health (average life expectancy), education (enrolment rate and illiteracy rate) and GDP per capita, and is constructed in a way allowing to determine extreme, target values of the abovementioned features. The HDI is used in reports produced by the United Nations Development Programme (UNDP).

Overview of the survey’s results

Singapore topped the Smart City ranking, retaining its position from last year. The next smartest cities are Helsinki (Finland), Zurich (Switzerland), Auckland (New Zealand), Oslo (Norway), Copenhagen (Denmark), Geneva (Switzerland), Taipei City (Taiwan), Amsterdam (Netherlands) and New York (USA). It is noticeable that most of the cities in the top ten are European. Warsaw was also ranked at 55th position (up 6 places from 2019).

For selected cities, the results of surveys conducted among residents have been published. Respondents identified priority areas that need attention and action. In Warsaw, the greatest demand is for affordable housing. Although this is a global phenomenon, it should be kept in mind that Warsaw’s population density as of 2019 is 3 437 people/km2 (compared to 8 479 people/km2 in Singapore). Another priority area was air pollution, which often exceeds acceptable standards in Warsaw. The unemployment rate in Warsaw was only 1.8% (as of 2020) and unemployment was the least frequently indicated problem. Despite this, research has shown that residents of Warsaw do not feel satisfied with their work. Another priority area appeared to be a road congestion, which causes traffic jams.

The other important part of the survey was to find out the position of residents on three aspects of privacy and the share of cashless transactions:

• willingness to share personal data in order to improve road capacity – 46.9% of Warsaw residents responded in the affirmative (for Singapore the result was 65.6%);
• feeling comfortable with using facial recognition technology to reduce crime – 62.1% (for Singapore, it’s 71.3%)
• a sense of increased trust in government due to available online information – 54.7% (for Singapore it is 72.5%);
• share of non-cash transactions – 80.9% (for Singapore it is 71.0%)

In the next stage of the survey, Warsaw residents rated existing infrastructure and technological equipment and available services in five areas, i.e. health and safety, mobility, activities, opportunities and management. The results are presented in such a way that each indicator shows the score for the city compared to the group it was classified into according to the Human Development Index (HDI). In Poland, both the existing infrastructure and technology were most often rated above average. In terms of health and safety, the biggest problem is air pollution and the inability to find housing, the rent of which does not exceed 30% of monthly earnings. On the other hand, access to applications that enable effective monitoring of air pollution and applications that make it easy to dispose of unnecessary items such as clothes were rated very highly. For mobility, traffic jam tracking apps were found insufficient.

Another area of study was activities. Both green spaces and cultural activities in Warsaw were rated highly. In terms of opportunities (work and school), employment opportunities (as evidenced by the low unemployment rate), access to good schools, job creation and online access to job opportunities were rated very positively. However, it was also pointed out that the teaching of computer science in schools is not at a satisfactory level and the problem is the speed of the Internet. The final area that was assessed was management. The results show that the introduction of online services has increased the participation of residents in municipal decision-making.

Summary

The results of the ranking are optimistic, as usually individual aspects were rated above average. The shortage of affordable housing remains the biggest problem. The pandemic and its associated movement ban has reduced residential sales and rental transactions and loans in the second quarter of 2020. The situation in the country may have encouraged those, who planned to buy a property, to hold off on their purchase decisions and wait for prices to fall. However, according to the data published in the AMRON-SARFiN 4/2020 Report, the average price per sqm of an apartment in Warsaw has not decreased, and the demand for loans has gradually increased since August 2020. Moreover, the pandemic had not a significant impact on housing construction, with an extraordinary number of apartments and houses being completed in 2020. While other aspects of city life, such as improved mobility and the use of increasingly new technological solutions, may influence the perception of Warsaw as a ‘smart’ city, even the pandemic proved to be an insufficient stimulus to lower prices on the real estate market.

Daria Łaskowska
Maintenance and Development Specialist