Singapore has claimed the title as fDi's Global City of the Future 2014/15 (registration required), with London, Hong Kong and Dublin in second, third and fourth place, respectively.
fDi - foreign direct intelligence - is a unit of The Financial Times, which tracks FDI - foreign direct investment activity.
Of the 130 locations analysed, Singapore ranked first for both Economic Potential and Business Friendliness. The city enjoys low rates of unemployment and inflation, recorded the highest GDP per capita of all Asian cities in the study, enjoys a low level of corruption and a good credit rating.
London ranked second in fDi’s Global Cities ranking, topping the tables for both Human Capital and Lifestyle and Connectivity categories. The UK capital boasts the highest percentage of university graduates among those of working age in all the locations studied; and is well served by six nearby airports, providing direct access to and from 304 international destinations.
Hong Kong ranked third overall, performing well in both the Business Friendliness and Connectivity categories. Investors in the city benefit from a relatively low corporate tax rate of 16.5%, minimal levels of corruption and a high degree of economic freedom.
From 2003 to 2009, more than one-third of global FDI went to the 130 locations analysed for the fDi’s Global Cities of the Future 2014/15 ranking. Nevertheless winning locations were heavily focused in Asia and western Europe. This may change - International Monetary Fund forecasts suggest that all eyes should be on Africa, with a potential for 7% growth in Nigeria alone in 2015.
According to Courtney Fingar, editor-in-chief of fDi Magazine, "Crossborder greenfield investment is on the rebound after a difficult few years, but it is still a tough and highly competitive environment for cities in all parts of the world as they strive to attract inward investment. While we have done regional comparisons for years, we thought it would be interesting to reflect the truly international nature of FDI competition by pitting cities in all world regions against each other and seeing how they stack up in the criteria that matters most for investors. Our findings reveal that rather than being a top-heavy list, it is a close competition and many of the leading cities of the world have a great deal of opportunity to offer investors."
Other highlights include:
Seoul came top at the category for emerging market cities with GDP Per Capita < $ 35,000.
Dubai topped the FDI Strategy category, followed by Hong Kong and Copenhagen.
Melbourne came second on human capital and lifestyle, after London.
Hanoi, Cairo and Ho Chi Minh are the top three in the cost effectiveness category
Large cities come after Megacities and Major cities.
Dublin was first for Large city Business Friendliness; second after Copenhagen for Human Capital and Lifestyle; and second after Dubai for Economic Potential.
It was 10th for connectivity.
To create a shortlist for fDi’s Global Cities of the Future 2014/15, the fDi Intelligence division of the Financial Times collected data using the specialist online tools fDi Markets and fDi Benchmark.
The list of 130 locations was drawn up to include the top 100 locations in terms of inward FDI projects on fDi Markets, plus any additional locations in the top 15, as classed for each region, not in the original list of 100 locations. Data was then collected for these 130 locations under five categories: Economic Potential, Business Friendliness, Human Capital and Lifestyle, Cost Effectiveness and Connectivity. Locations scored up to a maximum of 10 points for each datapoint, which were weighted by importance to the FDI decision making process to compile both the subcategory rankings as well as the overall Global Cities of the Future 2014/15 ranking.
In addition, surveys were collected under a sixth category, FDI Strategy. This category is the only qualitative category, and does not feed into the overall result. For this category there were 44 submissions – locations submitted details about their strategy for promoting FDI, which was then scored by fDi’s judging panel. In previous rankings, FDI Strategy had been included in the overall ranking, however, in order to separate totally qualitative and quantitative data, we chose to list FDI Strategy as a standalone ranking.
Cities in the study were categorised according to population. In total, 24 cities were classed in the Megacities category. This included locations with an urban zone population greater than 10 million. In addition, 62 cities were classed as Major, with an immediate city population greater than 750,000 and an urban zone population greater than two million, or an urban zone population of four million. Large locations (34 locations) had an immediate city population of more than 500,000 and an urban zone population over 1 million, or an urban zone population over 2 million. Small and medium locations made up the remaining 10 locations.
Finally, an Emerging Cities category was determined. The 58 locations in this category had a GDP per Capita figure below $35,000.
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