New York and London are the world's most competitive cities in terms of their ability to attract
capital, businesses, talent, and visitors, according to a study by the Economist Intelligence Unit commissioned by Citigroup.
The EIU found that US and European cities are the world’s most competitive today, despite concerns over aging infrastructure and large budget deficits. Cities from the United States and Western Europe account for 24 of the top 30 cities. While there is much concern in the West about the impact of the financial crisis, which has slowed plans for urban renewal, this has not reduced the ability of US and European cities to attract capital, businesses, talent, and tourists.
Asia’s economic rise is reflected in the economic competitiveness of its cities. Asian cities dominate the “economic strength” category of the competitiveness index—the most highly weighted category. All but five of the top 20 cities are Asian. Tianjin, Shenzhen, and Dalian top the list, while nine other Chinese cities rank in the top 20. Singapore (15th), Bangalore (16th), Ahmedabad (19th), and Hanoi (joint 20th) round off the list.
The top 32 Asian cities are all forecast to grow by at least 5 percent annually between now and 2016. Twelve of them will grow by at least 10 percent. This is in stark contrast to the low-single-digit growth of most developed market cities in Europe and the United States.
Midsized cities—ranging from Hanoi to Houston—dominate the growth rankings. They are collectively forecast to grow by 8.7 percent annually over the next five years, ahead of the
megacities on which many firms focus.
The most significant advantage that developed country cities hold is their ability to develop and
attract the world’s top talent. European and American cities dominate the human capital category of the index. This stems primarily from the quality of their educational systems and the entrepreneurial mindset of citizens. But other factors bolster their performance too, such as cultural activities and a generally good quality of life.