World's Most Competitive Cities 2018

2018 The World’s Most Competitive CitiesTABLE OF CONTENTS2 2018 W O R L D ’ S M O S T C O M P E T I T I V E C I T I E SAEROSPACEAUTOMOTIVEBUSINESS & FINANCIAL SERVICESCHEMICALS & PLASTICSELECTRONICSENERGY4 DATA & ANALYSIS5 INTRODUCTION6 METHODOLOGY11 Dallas-Ft. Worth-Arlington, TX, USA37 Berlin-Brandenburg Metro Area, Germany39 Shanghai Metro Area, China19 Birmingham Metro Area, UK21 Pune Metro Area, India47 Chengdu, China Spotlight27 Frankfurt Rhine Main Metro Area, Germany33 Dubai-Sharjah-Ajman Metro Area, UAE55 Houston - The Woodlands -Sugarland, TX, USACover Design by Negin Momtaz2018 W O R L D ’ S M O S T C O M P E T I T I V E C I T I E S 3FOOD & BEVERAGEICT (INFORMATION & COMMUNICATIONS TECHNOLOGIES)LIFE SCIENCESMACHINERY & EQUIPMENTMETALSTRANSPORTATION & LOGISTICS111 TOP CITY SPOTLIGHTS65 Chicago-Naperville-Elgin, IL-IN-WI, USA91 São Paulo Metro Area, Brazil71 Budapest Metro Area, Hungary101 Abu Dhabi, UAE81 Suzhou Metro Area, China83 San José-Heredia Metro Area, Costa Rica107 Singapore109 San José-Heredia Metro Area, Costa RicaDATA & ANALYSISHeadquartered in Atlanta, Georgia, Conway, publisher of Site Selection magazine, the Conway Analytics Report and a family of online industry newsletters, has been a trusted advisor to corporations, government economic development and investment promotion agencies around the world since 1954. In addition to its publishing endeavors, Conway owns and manages Conway Events, organizer of worldwide FDI events including the annual WORLD Forum for FDI; corporate and FDI advisory ﬁrm Conway Advisory; and New York-based Conway PR & Marketing, a leading PR and lead-generation ﬁrm. For more information, visit www.conway.com.EY is a global leader in assurance, tax, transaction and advisory services. e insights and quality services we deliver help build trust and conﬁdence in the capital markets and in economies the world over. rough its Quantitative Economics & Statistics (QUEST) and Location Advisory Services practices, EY delivers valuable insights to clients seeking to locate a facility and to governments developing an economic development strategy.EY’s QUEST practice assists clients with quantitative, fact-driven evaluations of location choices, including growth trends, labor market analyses, tax climate evaluation, and economic impact analysis. EY’s Location Advisory Services practice assists clients develop and execute an incentives strategy, from engaging with local communities to complying with incentive program requirements. Contact Andrew Phillips, EY Quantitative Economics & Statistics at 202-327-7815 or andrew.phillips@ey.com.e Milken Institute is a nonproﬁt, nonpartisan think tank determined to increase global prosperity by advancing collaborative solutions that widen access to capital, create jobs, and improve health. e Institute conducts data-driven research convenes action-oriented meetings and promotes meaningful policy initiatives. e Milken Institute Best-Performing Cities Index for the U.S. — based on metrics such as job, wage and salary growth and technology output over time — has been published annually since 1999, and now the methodology serves as a guide for new reports evaluating Chinese and European cities. For more information, visit www.milkeninstitute.org.Founded in 1981 as a commercial venture with Oxford University’s business college, Oxford Economics is now one of the world’s foremost independent global advisory ﬁrms, serving a worldwide client base of more than 1,500 international corporations, ﬁnancial institutions, government organizations and universities. Our best-in-class global economic and industry models include detailed forecasts on more than 100 industries and over 3,000 cities and regions around the world.e location strategies practice at Oxford Economics leverages these resources to bring a global perspective and unique insight to each engagement and enables us to answer complex questions such as how tariﬀs and trade policy aﬀect supply-chains; where talent is likely to be available today and in the future; or which location provides the best opportunity for corporate success. In addition, we advise governmental agencies on strategies for accelerating economic development in their communities or countries. For more information please contact: Dan Levine, Practice Leader, Location Strategies at (646) 503-3067 or email DanLevine@OxfordEconomics.com.4 2018 W O R L D ’ S M O S T C O M P E T I T I V E C I T I E SINTRODUCTIONTAKE ADVANTAGE OF THESE VANTAGE POINTSNow that borders are closing, the silk roads of culture are urban. We communicate through cities in terms of art and music and dance and books. And if I’m going to Europe, I don’t say I’m going to Spain, I say I’m going to Madrid. I’m not going to Germany, I’m going to Berlin. It’s so important to keep those networks really powerful among the cities.” — Artist, musician and poet Laurie Anderson, Live from NYPL, October 2018Around the same time Laurie Anderson was uttering the ominous yet hopeful words above in New York, I heard journalist James Fallows, longtime correspondent at e Atlantic, tell an audience at the annual conference of the International Economic Development Council in Atlanta, “Everybody should see the country from 2,000 feet up. e view is so rich — you see why cities are where they are.”Fallows, a lifelong small aircraft pilot, was sharing insights from his travels with his wife Deborah that went into their book “Our Towns: A 100,000-Mile Journey into the Heart of America.” One of them? “What I think of as reverse talent ﬂ ow,” he said. Historically, big cities grow into mega-cities because they keep attracting more companies and more talent, “but we were struck at how often people have worked in those places, but [then found] the overall picture for them was better in Sioux Falls, Sacramento or Redlands,” he said. e Fallows’ method bears an eerie resemblance to those of the late H. McKinley “Mac” Conway, who founded Conway, Inc., publisher of Site Selection magazine and of this report, in 1954. His preferred mode of travel to learn about the world and industrial development was piloting his own aircraft, often with family in tow, whether cruising above new developments in Florida, edging over mountain ranges in South America or nailing a landing in the Asia Paciﬁ c. e vantage point was just close enough to make out meaningful details, and just far enough away to give those details meaningful perspective. at’s the sort of vantage we, along with our partners, have attempted for 64 years in Site Selection magazine, and for several years in this report. Calculations based on hard data yield metro area rankings across 12 industry sectors in six world regions. at’s the high-level view, borne aloft by the sort of analytics that Conway, EY, Milken Institute, Oxford Economics and our contributors from Tractus Asia, among others, are known for. We then color these ﬁ ndings with project charts, infographics, demographics, city spotlights and quotations that capture the essence of the world’s leading urban areas for economic development and, often, for culture and creativity too.Most of them you’ll recognize, but probably not all. Some are top competitors for corporate investment because they are essentially all the buzzwords at once, i.e. smart, connected, sustainable ecosystems ﬁ lled with ﬂ uid innovation, mixed-use density and both physical and social mobility. And some ﬁ nd themselves beneﬁ ting from the competitiveness of their states and nations — unless you’re Singapore, in which case you get to be No. 1 in all categories.“By 2050, more than 70 percent of the world’s population will live in cities,” wrote Zeynep Bodur Okyay, President and CEO, Kale Group, in a recent column for the World Economic Forum. “Cities are the new engines of growth in the global economy, responsible for 80 percent of global GDP. Regardless of size, they are becoming nodes of innovation, production and creativity. rough investments in smart technologies, they have the power to reverse migration and attract talent.” ey are, in other words, the craft bearing us toward the future. Use this guide as one useful gauge to consult on your approach path for a soft landing.Adam BrunsManaging Editor, Site Selection MagazineNand dance and books. And if I’m going to Europe, I don’t say I’m going to Spain, I say I’m going to 2018 W O R L D ’ S M O S T C O M P E T I T I V E C I T I E S 5METHODOLOGYThe publishers believe that the information contained in this publication is accurate. However, the in formation is not war ranted, and neither Conway, nor EY,Oxford Economics, or Tractus assumes any liability or responsibility for actual, consequential or incidental damages re sulting from inaccurate or erroneous information. PHONE: (770) 446-6996 • FAX: (770) 263-8825 • TOLL FREE: (800) 554-5686 email: editor@conway.com web: conway.com The World's Most Competitive Cities is published by Conway, 6625 The Corners Parkway, Suite 200, Peachtree Corners, GA 30092 USA. PRINTED IN USA. ©2018 ConwayAdditional analysis was provided by Tractus Asia Ltd. (www.tractus-asia.com), a leading management consulting rm headquartered in Bangkok, Thailand, with of ces in China, India, Thailand, Hong Kong, Indonesia, Myanmar, Singapore and Vietnam. For the last 20 years and with a team of 60 professionals, Tractus has advised and assisted over 1,000 multinational companies and public- and private-sector clients in making intelligent decisions about where to locate and how to structure their direct investments in or from Asia. PRESIDENT & PUBLISHER ADAM JONES-KELLEY EXECUTIVE VICE PRESIDENT RONALD J. STARNER VP OF PUBLICATIONS & EDITOR IN CHIEF MARK AREND MANAGING EDITOR ADAM BRUNS SENIOR EDITOR GARY DAUGHTERS MANAGING EDITOR OF CUSTOM CONTENT SAVANNAH KING ART DIRECTOR SCOTT LARSEN PRODUCTION COORDINATOR/DESIGNER BOB GRAVLEE LEAD DESIGNERS SEAN SCANTLAND, RICHARD NENOFF, NEGIN MOMTAZ GRAPHIC DESIGNER WHITNEY ONI EDITORIAL DATABASE MANAGER KAREN MEDERNACH RESEARCH ASSOCIATES SPENCER BAUER, BRIAN ESPINOZA MCKENZIE WRIGHT VICE PRESIDENT OF SALES CHARLES FITZGIBBON REGIONAL DIRECTOR KRISTIN PICKETT VICE PRES., GLOBAL INNOVATION GUILLERMO MAZIER MARKETING MANAGER STEPHANY GASPARD CLIENT SERVICES MANAGER BRIAN WATSON CIRCULATION MANAGER JULIE CLARKE DIGITAL TECHNOLOGY TE AM WEBMASTER BEN YAWN DIRECTOR OF PROGRAMMING & ANALYTICS DANIEL BOYER SENIOR PROGRAMMER RENATO BYRRO IT COORDINATOR MARK BERTRAMThe 2018 World’s Most Competitive Cities report ranks top metro areas in six world regions across 12 prominent industry sectors, based on their proﬁ ciency in attracting corporate facility investments, supplemented by economic performance indicators. e rankings are calculated using two layers of data:1. Corporate end-user facility investment project data from January 1, 2014, through December 31, 2017, from Conway Analytics’ Conway Projects Database, which qualiﬁ es projects involving new construction based on meeting at least one of three criteria: a) at least US$1 million invested; b) at least 20 new jobs created; or c) at least 20,000 new sq. ft. of space. e database is populated and updated daily based on AI-assisted research scouring the globe for announcements, ﬁ lings, reports and news stories.2. Economic indicator input from our partners at EY QUEST (Quantitative Economics and Statistics) for the U.S. and Europe. Indicators include total employment and establishments by sector; growth in employment and establishments; scores in the Indiana University Business Research Center Innovation Index 2.0; total business eﬀ ective tax rate; taxes per 1,000 employees; area location quotient (relative concentration of employment in the sector); and change in location quotient. EY data sources include the U.S. Bureau of Labor Statistics, U.S. Census Bureau, EY total state and local business taxes, and EY QUEST calculations.3. Economic indicator input from the Milken Institute’s 2017 Best-Performing Cities indices for the U.S., Europe and China. Indicators include employment and wage growth, and location quotient ratings based on gross value added in manufacturing and high-tech services.Further insights from EY, Milken, Tractus Asia and Oxford Economics appear throughout the report.T6 2018 W O R L D ’ S M O S T C O M P E T I T I V E C I T I E SAERO SPACEverything in support of aerospace is hot right now," Judy Kruger, director of strategic initiative and cluster development for the aerospace & defense and advanced transportation sectors at the Los Angeles Economic Development Corporation, told Site Selection in July 2018. L.A. was surpassed only by Dallas-Ft. Worth and Miami in this year’s North American rankings. Traﬃ c at those cities’ primary airports qualiﬁ es them among what the Airbus Global Mar-ket Forecast deﬁ nes as an aviation megacity: those with more than 10,000 daily international passen-gers who ﬂ y more than 2,000 nautical miles.Airbus says the number of those aviation megac-ities should grow from 64 in 2017 to 91 by 2037, when Philadelphia, Orlando and our other No. 3 North American aerospace metro, Seattle, will enter the aviation megacity ranks. Airbus says China will be the world’s No. 1 economy, followed by the U.S. and then India. Our rankings ﬁ nd Bengaluru and Mumbai in India already leading the way, sandwich-ing the perennial leadership of Singapore in this sector (and so many others).In its forecast, Airbus says factors driving booming air travel include private consumption increasing 2.4 times in emerging economies, higher disposable incomes and a near doubling of the middle classes globally, especially in the Asia Paciﬁ c region, where it forecasts the need for 15,640 new aircraft by 2037. Boeing predicts 12,820 deliveries there by 2032.“ e Asia Paciﬁ c region, which includes China, will continue to lead the way,” said Boeing.Boeing released its long-haul forecast at the same Farnborough Air Show as Airbus did, in July 2018 in the United Kingdom, where our No. 1 Western Europe aerospace metro, Sheﬃ eld, last year wel-comed the groundbreaking for Boeing’s ﬁ rst Europe-an manufacturing facility.“Airbus and Boeing are the dominant players, and each has plans to increase production in the other’s home turf,” says Dan Levine, Oxford Economics’ practice leader, location strategies, noting production expansion at the Airbus plant in Alabama. “Still, these giants are being increasingly challenged in the regional jet segment by producers in Brazil, Canada, Russia and China.” e number of passengers connecting via a Middle Eastern hub has more than trebled over the last 10 years. Airbus notes nearly $100 billion being invested in more than 40 airport projects in the re-gion, including in our No. 2 Middle East aerospace metro Abu Dhabi. e tariﬀ implications for supply chains of trans-portation sector manufacturers present a challenge for all parties, Levine says. Nevertheless, "for the ﬁ rst time in years, we are seeing economies growing in every region of the world,” said Randy Tinseth, Boeing’s vice president of commercial marketing.Boeing projects the need for 42,730 new jets valued at $6.3 trillion over the next 20 years (about 5,000 more aircraft than Airbus projected). e aerospace opportunity for cities is not all about man-ufacturing, however: Boeing’s commercial Market Outlook sees the demand for commercial aviation services totaling $8.8 trillion.Expect to see the regions ranked here competing for that investment, as the ﬂ ow of global capital races to keep up with the ﬂ ow of global passengers.“ 2018 W O R L D ’ S M O S T C O M P E T I T I V E C I T I E S 7Next >