Cities are key drivers of the global economy, generating around 80% of global GDP and concentrating businesses, jobs, resources, and innovation. In this context, investment in smart city development is becoming an important tool for improving urban governance efficiency, sustainability, and investment attractiveness. This is stated in a new report by the AIFC analytical center, AIFC Insights, El.kz reports.
Cities as centers of economic growth
The report “A New Wave of Urban Development: Investment in Smart City Infrastructure and Technologies” notes that modern cities concentrate businesses, jobs, innovation, and resources. This strengthens their role as primary hubs for value creation and demand for infrastructure investment.
Today, cities are no longer just administrative centres. They are transforming into interconnected digital ecosystems where data, the internet, and artificial intelligence are used to improve quality of life, enhance management efficiency, and create a safe and comfortable urban environment.
Digital transformation of Kazakhstan’s cities
In Kazakhstan, the national program “Digital Kazakhstan” has laid a strong foundation for the digital transformation of cities. Astana, Almaty, and Shymkent are already implementing intelligent transport management systems, urban infrastructure monitoring, and AI-based analytics, helping to improve safety and convenience for residents.
The report also highlights the Smart City Astana project, implemented in Astana in partnership with Presight AI (UAE). The project includes the creation of a modern situational center, a city data center, digital integration of key infrastructure systems, and the deployment of data analytics and AI technologies. This digital architecture elevates urban governance to a new level by ensuring process transparency, the efficiency and validity of management decisions, and improving the comfort and safety of the urban environment.
Technology is not the only success factor
Analysts emphasize that a smart cities are not just about technology implementation. Success depends on the level of data integration, the development of digital infrastructure, and institutional trust. According to the UN E-Government Development Index, Kazakhstan ranks 24th globally, while Astana holds 46th place in the Smart Centres Index, demonstrating a high level of digital service development.
Smart cities market and investment potential
According to expert estimates, the global Smart Cities market will exceed USD 1 trillion by 2027. At the AIFC, we see significant potential in this trend and are ready to continue facilitating the attraction of international technology players to the markets of Kazakhstan and Central Asia,” said Zhanbolat Kakishev, Chief Product Officer of the AIFC Administration.
International experience and long-term challenges
The experience of leading global cities such as Zurich, Singapore, Seoul, Copenhagen, Dubai, and Amsterdam shows that the success of smart cities is determined not by the number of technologies implemented, but by the maturity of institutions, the compatibility of systems, and the level of public trust. The best results are achieved by countries and cities that move from isolated pilot projects to an integrated development model, aligning solutions at both national and city levels.
According to forecasts, around 68% of the world’s population will live in cities by 2050. Under these circumstances, urban efficiency, sustainability, and digital readiness become key factors of national competitiveness. At the same time, cities account for around 75% of global CO₂ emissions, and the 25 largest cities generate more than half of all urban greenhouse gas emissions, highlighting the importance of implementing digital and environmentally sustainable solutions.