Successful cities will understand their global niche

12 December 2016

Megacities like London, Tokyo and New York are no longer driving the world economy, a report has claimed.

The study from the Metropolitan Policy Program of US research group Brookings Institution aims to redefine what it means to be a “global city”.

“Cities that understand their unique niche in the global economy are better positioned to create economic strategies that will be successful in the long-term,” said Brookings Fellow Joseph Parilla, one of the study’s authors.

The study classified the world’s largest metropolitan economies into seven groups based on their distinct competitive advantages in the global economy: Global Giants; Asian Anchors; Emerging Gateways; Factory China; Knowledge Capitals; American Middleweights; and International Middleweights.

Redefining global cities: The seven types of global metro economies uses dozens of indicators to examine global city economic characteristics, industrial structure, and key competitiveness factors such as tradable clusters, innovation, talent, and infrastructure connectivity.

Analysis centres on the 123 largest metropolitan economies in the world, which account for a third of global GDP while containing only 13% of global population. 

Global Giants include New York and Los Angeles, Tokyo and Osaka-Kobe, as well as Paris and London.

The less wealthy Asian Anchors attract the most FDI, said the study, and include Beijing, Hong Kong, Seoul-Incheon, Shanghai, and Singapore as well as Moscow. 

Emerging Gateways include 28 large business and transportation points for major national and regional markets such as Johannesburg, Mumbai, São Paulo and Istanbul, which have reached middle-income status but lag on many key competitiveness factors.

The fastest growing type of city is the Factory China grouping, which includes 22 second and third-tier Chinese cities reliant on export-intensive manufacturing. These cities must now upgrade the talents of their workforce to become more balanced, service orientated urban centres, according to the study.

Boston, Dallas, San Jose, Seattle, Amsterdam and Zurich are among the 19 Knowledge Capitals, classed as mid-sized innovation centres with talented workforces and elite research universities. 

The American Middleweights grouping features 16 mid-sized U.S. cities like Indianapolis, Miami, and St Louis that are relatively wealthy and house strong universities but attract relatively low FDI levels.

International Middleweights, which include 26 mid-sized cities such as Melbourne and Sydney, Montreal and Toronto and several German centres are seeing growth lagging after the financial crisis.

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