Nairobi scores poorly in the latest smart city ranking

Basic amenities, health services, unemployment and security are major concerns of Nairobi city's over five million residents.

These are followed by corruption or transparency, affordable housing, fulfilling employment, road congestion, school education, air pollution, citizen engagement, public transport, social mobility or inclusiveness, recycling and green spaces.

This is according to IMD's World Competitiveness Centre's Smart City Index 2025, which ranked 146 cities.

Under the Smart City Ranking, Nairobi ranked in the lowest group four, at position 136, scoring a D, which is a drop from position 131 in 2024 out of 142 cities with the same grade D.

The top 20 smart cities are Zurich, Oslo, Geneva, Dubai, Abu Dhabi, London, Copenhagen, Canberra, Singapore and Lausanne. Others are Helsinki, Prague, Seoul, Beijing, Shanghai, Ljubljana, Amsterdam, Stockholm, Hong Kong and Hamburg.

There are minimal shifts since last year's ranking among the top 20 cities; notably Taipei City slid from 16th in 2024 to 23rd in 2025, and Ljubljana jumped from 32nd to 16th.

Nairobi in Africa was ranked 136 among other cities like Abuja (Nigeria) at 133, Accra (Ghana) at 141, Algiers (Algeria) at 128, Cairo (Egypt) at 117, Cape Town (South Africa) at 124, Lagos (Nigeria) at 135, Rabat (Morocco) at 123 and Tunis (Tunisia) at 142.

Worldwide, affordable housing is a major concern for cities. In 110 out of 146 cities, affordable housing is mentioned as a priority by at least half of the respondents in the city.

The issue is particularly felt in Dublin and Vancouver, where about 90 per cent of the IMD Smart City Survey respondents expressed concern over housing affordability.

In Nairobi, affordable housing was not a major concern, but it scored 43.8 per cent. Respondents in the Middle East agree with about 80 per cent of respondents from AlUla or Dubai who identify affordable housing as a priority area.

Housing has become increasingly unaffordable for many households over the past couple of years.

According to International Monetary Fund (IMF) data, it is currently less affordable than during the house price bubble that preceded the 2007-2008 global financial crisis.

This harsh statistic is reflected in the responses in the IMD Smart City Survey: in cities as far apart geographically as Lisbon, Vancouver, Dublin, and Reykjavik, some nine in 10 respondents report difficulties finding housing that costs less than a third of their income.

Kenya's Kenya Kwanza regime is currently executing the Affordable Housing Programme (AHP), where salaried Kenyans are being taxed 1.5 per cent levy from their salaries as the employer reciprocates the same to go towards the construction of houses.

The regime aims to construct 200,000 annually for the next five years till 2027, though it seems to fall behind schedule. The Smart City Ranking assesses how urban technologies and infrastructure perform in five key areas -health and safety, mobility, activities, opportunities and governance.

To ensure accuracy and mitigate the influence of potential outliers, the firm employs a three-year moving average of residents' perceptions along the different issues considered.

The index's report on housing is derived from 39 survey responses collected from residents representing various levels of society.

Answers to the question "Is finding housing with rent equal to or less than 30 percent of the average monthly salary a problem in your city?" shaped the direction of the report.

It elaborates on how higher tariffs on steel and potentially lumber - part of the aggressive trade stance adopted by the United States this year - are expected to increase development costs, putting further stress on an already-constrained housing supply.

Direct participants in the trade war will likely experience economic losses that could outweigh any benefits, the report says.

Consequently, rising inflation could damage industries heavily reliant on imported materials, construction being one. "While cities are engines of economic growth and attract significant talent, this very success often drives up living costs," said Director of the WCC Arturo Bris.

"We observe a persistent gap between wage growth for many urban dwellers and the escalating price of housing, whether renting or buying."

Factors like gentrification in diverse neighbourhoods, a lack of affordable units being constructed, and speculative investment patterns are major factors behind the trend, the report finds.

It also underlines that the crisis is more keenly felt in urban areas, largely due to growing immigration influxes.

The IMD report avoids comparing two cities at very different stages of development. The survey responses are rescaled according to how they rank in the Global Data Lab's Subnational Human Development Index.

The WCC defines a Smart City as one that strikes a good balance between its economic prowess, such as jobs and housing, applied technology, environmental concerns, and inclusiveness to facilitate its citizens' quality of life.