Singapore, the 3rd most competitive city in World

14.03.2012

The Republic has emerged as Asia's most competitive city and third globally - after New York and London, according to the Economist Intelligence Unit's (EIU) inaugural Global City Competitiveness Index.
Apart from Singapore, Hong Kong (joint 4th) and Tokyo (6th) were the only other Asian cities that made it to the overall global top 10 rankings, which were dominated by American and European cities.
But the established order could well be upset in a few years, with the rise of a second tier of emerging market cities mainly in China, the EIU noted in its report.
The index, which is commissioned by Citigroup and is expected to be issued biennially, measures cities across eight categories of competitiveness and 31 individual indicators. The categories include economic strength, financial maturity, global appeal and physical capital.
Under the "economic strength" category - which is the most highly weighted - the Chinese cities of Tianjin, Shenzhen and Dailian took the top three spots. New York (4th) and Tokyo (8th) are the only developed world cities in the top 10. Singapore is in 15th place.
According to the report, while megacities - defined by EIU as having populations of 10 million or more - are forecast to grow at 6.3 per cent between 2010 and 2016, the middle tier cities - defined as those with populations of between two and five million - will outpace that, growing at 8.7 per cent overall.
The EIU report noted that China already has some 150 cities with at least a million inhabitants and by 2020, the number is expected to increase to between 220 and 400.
"This will surely propel some hitherto unknown cities onto the world stage," the report added.
For now, American and European cities are ranked highly despite sombre economic growth outlook and large budget deficits as they hold the "significant advantage" of being able to attract and develop talent, the report said.

How Singapore fared
Singapore ranked top globally in financial maturity and physical capital and did well in other categories such as global appeal and institutional effectiveness.
The Republic, however, fared less well in human capital - which uses indicators such as an entrepreneurial and risk-taking mindset among a city's population - and social and cultural character, which uses indicators such as freedom of expression and human rights, openness and diversity, presence of crime in society and cultural vibrancy.
To move up the rankings, Singapore must address social inequality, the report said. It added: "Singapore the global city is increasingly different from Singapore of the heartlands."
Nevertheless, EIU Asian senior editor for industry and management research Sudhir Thomas Vadaketh pointed out at a press conference yesterday that Singapore is not the only developed city grappling with social inequality.
Experts Today spoke to agreed that the EIU index and report reinforced Singapore's position as a competitive and vibrant city but more measures were needed to narrow the income gap.
Said CIMB-GK economist Song Seng Wun: "Unlike Hong Kong which has Shenzhen as its hinterland, Singapore is a city-state - people can't pack their bags and move into the country if they find the cost of living in the city too high."
Mizuho Corporation Bank market economist Vishnu Varathan felt that the Republic needs to "encourage creativity, and not make it too construed" when it comes to inculcating in its people an entrepreneurial and risk-taking mindset.

Business-wise, Singapore has one of the best environments in the world by offering tax incentives and streamlining licence approvals. "We have always been a hub open to the flow of people, ideas, capital, goods and services," said Mr Khoo Teng Chye, executive director of Singapore Centre for Liveable Cities.

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