Is China setting the pace in the global race to create sprawling megacities?

More than half of the world’s population now lives in urban areas, with roughly 54% of the global population of 7 billion residing in cities. Experts project that by the mid-21st century this figure could climb to 66%, underscoring the accelerating pace of global urbanization. Currently, there are 37 megacities worldwide, a number expected to reach 41 by 2030. The United Nations highlights Asia and Africa as the regions experiencing the fastest urban growth, with Nigeria, India, and China together forecast to account for 37% of this expansion. Historically, urbanization was central to building strong middle classes in Western nations after the Industrial Revolution, and many analysts expect a similar transformation in developing countries today.

Nigeria illustrates this trajectory. The World Bank reclassified the nation from “lower middle income” to “middle income” in 2008, and it is now Africa’s largest economy, supported by a rapidly growing consumer class. A McKinsey & Company report shows Africa’s middle-class households have already outnumbered those in India.

China, however, presents a more complex picture. With an urban population projected to reach 1 billion by 2030, the country has announced plans to create 19 megacities designed to function as interconnected clusters, cooperating economically, ecologically, and politically to strengthen regional competitiveness. This urbanization drive is part of broader policies aimed at boosting domestic consumption amid global trade headwinds, according to China Daily. The strategy, introduced by the Communist Party and the State Council in December 2022, spans from 2023 to 2035. Yet China’s household registration system, or hukou, poses a significant obstacle. This system restricts rural migrants from settling in cities without official permits, limiting their access to essential services such as healthcare and education.

At a Brookings Institution forum, Hu Bingliang, Dean of Development Studies at Beijing Normal University, urged reforms to this system. He emphasized the need to improve public services in small and mid-sized cities while allowing market forces to guide the pace of urban growth. Despite such recommendations, China continues to concentrate on building megacities. Rapid construction has often outpaced demand, giving rise to so-called “ghost cities” with low occupancy rates.

Nevertheless, there are signs of recovery. A report by Standard Chartered Bank noted that between 2012 and 2014, three previously underpopulated cities saw remarkable improvements—one doubled its population, another quadrupled, and one raised its occupancy rate from 20% to 50%. Changzhou, once labeled a ghost city, now supports a population of 4.5 million.

Shenzhen provides another example of urban wealth creation: the combined fortune of 300,000 local residents has surpassed $30 billion. Yet the city’s soaring living costs continue to burden poorer populations, many of whom have migrated from other provinces in search of opportunity.