Global Urban Competitiveness Report

（ 2011-2012 ）

Pengfei Ni

Global Urban Competitiveness Project （ GUCP ）Center for City and Competitiveness (CCC,CASS ）

China Beijing, 27 June, 2012

《 Global Urban Competitiveness Report 2011-2012 》

Brief of Research With nearly 100 experts, GUCP project team implemented 2 years' tasks of data collection, organization, verification and comparison, improved the index system and evaluation method, quantities analysis and empirical test. The project team members conducted considerable number of research and discussion, communicated with many experts from countries around the world, and contacted several city governments for field researches in different countries. The team members fully explored and ultimately finished the annual report on the basis of sorting out expert opinions and the completion of the global urban competitiveness assessment.

Part 1

Introduction of Analysis Method

Ⅰ Global Urban Competitiveness:

Background of ResearchStructure of global production, trade and financial are changing

Developed countries such as The United States, Europe,s promote the

“Re-industrialization” strategy; Resurgence of Developed countries, trade

protectionism; Developed countries to increase the savings rate, while Develo

ping countries are improving the rate of consumption

Urbans facing re-positioning in The global industrial chain 。

The world's new technological revolution is bred 。 The new technological revolution will strengthen the sustainable urban competitive

ness ， affect the competitiveness of various cities Significantly 。

The Urbans of emerging economy rise strongly in the crisis

Ⅱ Global Urban Competitiveness : research situation

Perspectives Authors and institutions Component Cities Indicators

Outcomes OECD, 2005 1 78 1

　 Peter Karl Kresl (USA,1999) 3 24 3

　 Pengfei Ni (China, 2001) 6 200 12

　 Dong-Sung Cho (Korea, 2006) 3 75 5

　 William F. Lever and Ivan Turok (UK,1999) 3 - 3

　 Jianfa Shen (HKSAR, China,2002) 3 286 52

Inputs Pengfei Ni (China, 2003) 12 60 199

　 Douglas Webster (World Bank, 2000) 4 - 75

　Augusto Lopez Kela-oluosi (World Economic Forum,2005) 3 55 40

　 David G. Tuerck (USA, 2002) 8 50 37

　 Abhishek Sharma (USA, 2006) 2 21 27

　 Dong-Sung Cho (Korea, 2006) 5 75 90

　 Alvin Diaz (Philippines, 2001) 7 65 71

Inputs-outcomes Robert Huggins (UK, 2003) 3 44 7

　 Core City Work Team (UK, 2004) 6 50 21

Ⅲ Global Urban Competitiveness:

Conceptual Framework Global Urban Competitiveness:

The urban competitiveness refers to a city’s ability in

relation to other cities in the world to attract and translate

resources, control and occupy markets, to create wealth as

fast as possible and offer well-being for its residents , which

is determined by the combination of its enterprise

operating factors and industrial systems

B

C

A

Value

Industry

Environ-ment

Concept framework

Urban Competitiveness Mechanism

Urban Competitiveness' Outcome: Value

Profit situation is the ultimate demonstration of the city

capacity and a dimensional and comprehensive concept 。 In this context, the model is ：

UCI= ƒ (ES, EG, EE, ED, EQ, IE)

UCI ： Urban Competitiveness' index

ES ： Economy scale EG: Economic Growth

EE ： Economic levels EQ: Economy quality

IE: Exterior Facts ED: Economic density

Urban Competitiveness Process: Industry City’s value is created through enterprises. The level of industry

system constituted by enterprises determines the level of entire

value system.

building trade manufacture

circulate

R&D

production

marketing

industry

industry

manufacture

building trade

transmission, computers and the software industry

computers and the software industry

industrial chains

Inside industry system within a city and its connection

Urban Competitiveness Input: Environment Urban competitiveness model including six potential variables:

UC= ƒ （ EQ 、 LE 、 LD 、 LC 、 GC 、 PI 、 LI ）UC: the urban competitiveness input; EQ: is the enterprises quality; LE : local environment (factors demand and supply) LD :local demands ; LC ： interior structure, reflecting interior connection and

aggregation GC ： global connection ;( the connection to the exterior, utilize the exterior factors and market and address the chance and challenge); PI ： public system; LI ： the local infrastructure.

Ⅳ Global Urban Competitiveness: Indicator system and Research design

Indicator system

2011-2012 Global Competitiveness Indicator System includes:

Global Competitiveness Production Indicator System,

Global Competitiveness Factor Indicator System

Global Competitiveness Industry Indicator System.

Production Indicator System is comprised of 6 indicators,

namely, Green GDP, GDP per capita, GDP per Sq Km, GDP

growth, patent applications and transnational enterprises index.

Indicators Measurement target Indicators Measuring objectO1 GDP scale Economic scale O4 GDP growth Economic growthO2 GDP per capita Development level O5 Patent application Technological innovationO3 GDP per Sq Km Economic aggregation O6 Transnational enterprises index. International influence

Production ： Global Competitiveness Indicator System

Industry Competitiveness Indicator System is formed through

nonlinear weighted synthesis after the innovation on 2009-2010

Industry Competitiveness Indicator System, industry hierarchy and

the global position of 22 industries.

Process ： Industry Competitiveness Indicator SystemC Industry Category Indicator C Industrial Segment Indicator

C3.1.1Defense aviation industry index C3.2.1Defense aviation industry segment index

C3.1.2Banking industry index C3.2.2Banking industry segment index

C3.1.3Business service industry index C3.2.3Business service industry segment index

C3.1.4Financial capital industry index C3.2.4Financial capital industry segment index

C3.1.5Chemistry industry index C3.2.5Chemistry industry segment index

C3.1.6 Hard goods industry index C3.2.6Hard goods industry segment index

C3.1.7multifunctional fiancé industry index C3.2.7multifunctional fiancé industry segment index

C3.1.8Pharmaceutical and biotechnology industry index C3.2.8Pharmaceutical and biotechnology industry segment index

C3.1.9 Health medical devices industry index C3.2.9 Health medical devices industry segment index

C3.1.10Fittingindustry index C3.2.10Fittingindustry segment index

C Industry Category Indicator C Industrial Segment Indicator

C3.1.11Insurance industry index C3.2.11Insurance industry segment index

C3.1.12Journalism industry index C3.2.12Journalism industry segment index

C3.1.13Retail industry index C3.2.13Retail industry segment index

C3.1.14Semiconductor industry index C3.2.14Semiconductor industry segment index

C3.1.15Software industry index C3.2.15Software industry segment index

C3.1.16Hardware equipment manufacturing industry index C3.2.16Hardware equipment manufacturing industry segment index

C3.1.17 Telecommunication industry index C3.2.17 Telecommunication industry segment index

C3.1.18Commerce industry index C3.2.18Commerce industry segment index

C3.1.19Municipal facility industry C3.2.19Municipal facility industry segment index

C3.1.20Material industry index C3.2.20 Material industry segment index

C3.1.21 Transportation industry index C3.2.21 Transportation industry segment index

C3.1.22 Energy industry index C3.2.22 Energy industry segment index

Industry Competitiveness indicator system is formed through nonlinear weighted synthesis after the innovation on 2009-2010 Industry Competitiveness Indicator System, industry hierarchy and the global

position of 22 industries. Investment ： Factor Environment Indicator SystemIndicators Measuring objects Indicators Measuring objects

I1 Enterprises quality I4.60.000-bed hospital Medical facility

I1. Transnational enterprises quantity

Enterprises level I4.7Amusement facility index Amusement facility

I2. Transnational enterprises growth

Enterprises I4.8 Hotel index Housing facility

potential

I3.Enterpriese index Enterprises quantity I4.9 Hotel price Commerce cost

I4.Enterprises brand Enterprises quality I4.10 Rental reference Living cost

I2 local situation I5.Interior environment

I2.1Huamn capital Human capital I5.1 Inflation rate Economic fluctuation

I2.2 Minimum wage Labor cost I5.2 Unemployment rate Unemployment rate

I2.3 College index Higher education I5.3 Political stability Political safety

I2.4 School index Education facility I5.4 Crime rate Social security

I2.5 Stock index Financial service I5.5 Climate index Climate

I2.6Bank index Financial service I5.6 CO₂ emission per capita Environment quality

Indicators Measuring objects Indicators Measuring objects

I2.7bank density Financial service I5.7 PM2.5 Environment quality

I2.8 Patent index Science output I5.8 History index History

I2.9 R&D numbers and technology parks Technology facility I5.9 Modern culture index Modern culture

I2.10 Research institution index Technology facility I5.10 multi languages index Diversified culture

I3 Local needs I6 Public system

I3.1 population Local needs scale I6.1 Ease of business Business regulation

I3.2 wealthy people index Demand level I6.2 Economic freedom index Economic freedom

I3.2 Population growth potential Demand growth I6.3 Proportion of fiscal, taxation Local fiancé autonomy

I3.3 One-hour flight GDP Region background I6.4 Public governance index Governance

I3.4 One-hour flight population Region background I7 Global connection

I3.5 Income per capita National background I7.1mutinational companies links Economic links

I3.6 National economic growth National background I7.2 International organizations index Political links

I4.Infrasture I7.3 international exhibition index Culture

I4.1 transport convenience Municipal facility I7.4 international popularity index City popularity

I4.2 Water supply ability Water supply facility I7.5 distance to sea Natural position

I4.3 Electricity supply quality Electricity supply facility I7.6 Airlines Infrastructures to the outside

I4.4 mobile phone numbers Communication facility I7.7 Road lines Infrastructures to the outside

I4.5 Network users Network facility I7.8 Internet servers Infrastructures to the outside

City samples Definition: The report called on city refers to an

administrative management center, which contains under the governance suburban urbanization area and may contain rural residents

The 500 cities in this report are selected in the following procedures.

– First and foremost, a loose study was carried out on all countries and regional cities, which was labeled as the preliminary screening.

– Second, a research referred to the population and income per capita of the country or the region was preceded in the 500 cities in order to identify the number of sample cities in those areas. .

– Afterwards, the research took country as a unit; roughly identify sample cities in a principle, from big to small, from good to bad, from high to low.

– Finally, considering the accessibility, accuracy and standard of the data, we adjusted the sample cites to make sure the sample cities’ data were available, standardized and accurate.

Assessment method Synthesis method In the calculations, we used a uniform calculation method to calculate t

he 2007-2008, 2009-2010 and 2011-2012 global urban comprehensive com

petitiveness and ensured the continuity and comparable of the global urban

comprehensive competitiveness index in space and time.

Global Urban Competitiveness Factor Environment Indicators

synthesis

Synthesizing Global Urban Competitiveness Factor Environment

Indicators at all levels, we used the simple linear and nonlinear weighted

average method synthesis. Global Urban Competitiveness Factor industry Indicators

synthesis

Industry takes nonlinear weighted synthesis and the level of industry

and the industrial structure is calculated by nonlinear weighted (or

"multiplication" synthesis)

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Part 2

Findings of comparative analysis

City, who can overcome the financial tsunami

Competitive advantages of “world cities” decease

absolutely and New York's decreasing amplitude is the

first, while Asian metropolises continue rising. Internal environment and public institution are the most

two important factors in a city’s competitive- ability;

high-tech industry, finance, public utilities are the key

support of urban competitiveness

Ⅰ Analysis on the Most Competitive Cities in the World New York rank No.1 and index decreasing amplitude is the first, while Hong Kong’s index upgrades rapidly

Compared with the result in 2009-2010, the absolute competitive index in New York, London, San Francisco, Chicago and Los Angles has decreased in 2010-2012.However, emerging economies show activity in this year and Asian metropolises like Hong Kong ,Singapore and Seoul have made themselves into the top 10. The gap of which with the following cities are narrowing, “Four World Cities” will be overtaken by other cities in near future if existing trends continue.

Index Movement of the 2007-2012 Top 10 Most Competitive Cities Worldwide

Internal environment and public institution :The two important factors in a city’s competitive- ability

As the potential competitiveness, competition elements represent the city’s development potential. By comparing and analyzing the environmental factors of the most competitive cities,

we can find:

Environmental Factors of the Most Competitive Cities

Internal environment, public institutions, global rela-tions and enterprise quality are very important factors of a city’s competitive ability, among which internal

environment and public institution are most prominent Internal Environment includes economic environment,

social environment, ecological environment and cultural

environment.

Public Institutions consist of life convenience, economic

freedom and the administration of the government.

High-tech industry, finance, public utilities are the key support of urban competitiveness

As an important support to a city, industrial environment is the driving force to the urban economic development. The study found that the most competitive cities also enjoy high industrial competitiveness. the high-tech industries like telecommunication, semiconductor, software and service, financial industries like insurance agencies, banks, and diversified financial institutions together with public utilities are the key support of urban competitiveness. For new “world cities” like Beijing and Shanghai, these industries are the most important focus in continuing rising and catching up with the top “world cities”.

Industrial Environment of the most competitive cities

Ⅱ Overall Comparative Analysis on Global Cities The Global urban competitiveness fell in 2010-2012 as a whole

with the steepest drop expected for Europe and US and the gap

between the cities has been reducing.

Compared with 2009-2010, the overall competitiveness of global cities are decreased in 2011-2012.

The average competitive index of 500 cities worldwide decreased from 0.328 in 2009-2010 to 0.323 in

2011-2012.Competitiveness index average score of developed countries cities have respectively

decreased absolutely,while Emerging economies show actively and average score drop Slightly, even so

me cities arise continuously. On the whole, the gap of global urban competitiveness index is assuming

narrower and narrower .

Average Competitiveness Variation of the Cities in Different Regions

American and European cities enjoy a high degree of economic freedom while emerging economies present a strong demand.

On the whole, the American and European cities still have great advantage, which

maintain superiority on overall element competitiveness, especially in the area of public

institutions, internal environment and local factors. But the local demand are relative weak

that they have to high depend on foreign trade. On the contrary, Asian cities, especially in

some emerging economies like China and India, have such great local demand that establish

great development potential and their GUCI ranking is going straight up.

Environmental Factors of Different Regions in 2011-2012

American and European major cities are facing over finan-cialization, while emerging economies have entered the period of the industrial structure transformation 

American and European cities show strong overall industrial competitiveness with high index scores in both industrial structure and industrial sectors, among which the high-tech industry is an important support. However, the overexposed proportion of financial centers shows that their economy depends too much on finance. The Asian cities get lowest scores in the industrial sectors and the industrial structure is just on an average level and the industrial development of them is still at the bottom of industrial chain,so that industrial upgrading should be promoted and the adjusting paces of the industrial structure should be accelerated. At present, since the emerging economies like Beijing and Shanghai have entered the period of the industrial structure transformation.

Cities of emerging economies rise quickly, technology centers perform particularly well.

Distribution of the Top 50 Cities with the Fastest Competitiveness Improvement in 2011-2012

（ Show in next page ）• The cities that improve the fastest are, in order, San Jose, Hong Kong, Suzhou,

Changsha, Lagos, Georgetown, Kingston, Xi’an and Mannheim.

• According to the analysis of these 50 cities we can see that half of them come

from China and India, among which 23 Chinese cities are ranking in the list.

• Technology centers perform particularly well, 11 technology centers are included

in the f top 50 despite the relatively small economic aggregate. San Jose, central

city of American Silicon Valley enjoys a fastest rising speed in its

competitiveness. In 2009, its per capita GDP reached $ 77401.91, occupying

the first place in the world and leading the development of global cities.

Distribution of the Top 50 Cities with the Fastest Competitiveness Improvement in 2011-2012

competitiveness indexes and economic aggregate of developed cities dropped together, but mainstream of BRICS countries cities are ascension

In 2007-2009, the overall competitiveness indexes and economic aggregate of

developed cities are dropped obviously, but economic aggregate of BRICS countries

cities arise absolutely and competitiveness indexes arise relatively. In the near future, it is

probably very difficult for developed cities to maintain their dominations in

competitiveness.

The Changes of Overall Competitiveness in the Five Developed Cities and the Five BRICS Cities

Ⅲ American and European cities decline obviously, while Asian cities increase

North American cities continue leading the Global Urban Competitiveness Ranking though the composite index decrease. The European competitive index ranking changed little; the dark clouds of European debt crisis remain. The competitiveness of core Asian cities increases with the slight shakes of overall index. In other regions, the cities at the bottom of the competitive ranking reduced, and the ranking of middle cities differentiated

Average Competitiveness Variation of the Cities in Different Regions

Ⅵ Financial centers decease while Technology centers rise

The Drop of Competitiveness in Major Functional Centers. (%)

Ⅴ High Income Cities Drop & Middle Incomes Rise

The income level of Global Urban overall Showed a narrowing of trend.. All sorts of comprehensive competitiveness index average score declined widespread. Compared with 2009-2010, Figure 2-4 shows, the city of the low-and middle-income levels in emerging economies enhanced faster, especially Chinese cities kept a rapid momentum. European and North American cities with a relatively high GDP per capita demonstrated an absolute amount of decline. European cities mean index decreased from 0.32 in 2009-2010 to 0.31 in 2011-2012

Comprehensive competitiveness index average score and change of different income level

Ⅵ Competitiveness input factors: high output efficiency in North America and Asia to enhance the potential of large, European investment needs to be strengthened

annual Region 10 1-100 101-200 201-300 301-400 401-500

average inde

xscore

Competiveness

North Amer

ican 4 42 36 20 6 3

0.38

Factors input

North Amer

ican 5 56 12 9 6 24

0.305

Competiveness Europe 2 35 33 16 13 390.331

Factors input Europe 2 27 31 19 19 400.262

Competiveness Asian 4 20 26 52 52 370.303

Factors input Asian 3 21 52 54 46 140.258

Competiveness Other 0 3 5 12 29 210.275

Factors input Other 0 6 7 9 28 200.224

Regional Distribution of rank Comprehensive Competitive-ness Index and Factors input

Part 3

Global Urban Competitiveness

Research Topics

Introduction of team writing research Topics report This year, a long-lasting wish has been fulfilled by inviting the research

team from International Organization and City and other world renowned expert teams, together with experts from GUCP to co-compose this report.

Research team, led by Banji oyelaran Oyeyinka, director of Global Urban

Evaluation and Research Department of UN Human Settlement Programme

Research team, The Doing Business Project of the World Bank Group ； Research team, led by Lamia Kamal-Chaoui, director of OECD Secretary-

General Office

Saskia Sassen, World well-known sociologist ＆ economist, professor of

Columbia University

the GAWC team led by Peter Taylor, world renowned urban researcher and a

academician of UK Royal Academy of Social Science

GUCP team, led by Peter Karl Kresl and Pengfei Ni

Pattern of the global city: Current and Future

What is current pattern of global city? What are opportunities an

d challenges of the global city? etc. Since early 2012, Global Urban Competitiveness Project group sent e-mail to experts and researchers nearly 100 colleges and universities in the world, as well as some city government officials and to conducted a survey study. On the basis of Collecting their answers to these questions and feedback, the team members list systematically some profound and important insi

ghts points on the pattern of the global city:

New phenomenon, challenges and hot topics of global cities mainly include global financial crisis, natural resources, city development and people’s livelihood etc.

The important or key questions of cities in the worldinclude natural resources, racial problems, and population movement

There are many aspects that are worthy of researching. For example, improving city’s sustaining development, city comprehensive management, preserving local culture and upgrading environment.

Economic growth and population movements are the key elements. Globalization are creating more chances for global city development and exerting different influence on it.

Today, some cities in developing countries have the tendency of dropping, while cities in developing countries are rising. These cities development are getting closer. The economic change on pattern will lead to the change in the world city pattern, in which case, the world is shifting to emerging economies cities.

A country should empower more authority on managing local affairs. The cities should strengthen their governance accordingly.

Technological change and green economy are both playing a role in strengthening the sustaining competitiveness in technology and energy and resources, which will significantly affect competitiveness.

It exerts a significant influence on the future development of a city. In the process of planning and development, the force the city has is very crucial, but still needs more joint efforts.

Apart from the big incidence concerning politics, military, security and natural disasters, the current threat the world is facing is much agglomeration and lack of reform.

All governments of cities are dealing with different problems. The rise of emerging cities may bring a change to the structure of global cities. The infrastructures are particularly important.

Experts or research team dissertate some of these issues

Professor Saskia Sassen believed that the Specialized

Differences were one key vector in urban competitiveness.

Banji Oyelaran-Oyeyinka paid special attention to social and

technological innovations in the Competitiveness of Cities.

The team led by Lamia Kamal-Chaoui explored the developm

ent of green cities and opportunities through the governance ca

ses study of the green growth in OECD countries

Team of the Doing Business Project of the World Bank Group shows the relationship between the system and urban competitiveness from the perspective of the business environment.

Peter·J·Taylor put forward the challenge facing world city network analysis

GUCP team, led by Peter Karl Kresl and Pengfei Ni, recommended that the city's decision-makers should enhance the urban competitiveness of the focus on the driving factors of the modern cities prosperity on the basis of the analysis in the global cities experience.

Pattern of The Global Urban CompetitivenessGlobal Urban Competitiveness statistical reports

(2011-2012)

Thank you!