TOP STORIES

Anna Teo

(SINGAPORE) Singapore has scored poorly for technology IQ and innovation, intellectual capital, lifestyle assets and even financial clout in a new study of global 'cities of opportunity'. But among the 11 cities tracked, it is the best place to do business.

The study, 'Cities of Opportunity: Business-Readiness Indicators for the 21st Century' by PricewaterhouseCoopers (PwC) and The Partnership for New York City, a network of business leaders, covered five North American cities (Atlanta, Chicago, Los Angeles, New York, Toronto), three in Europe (Frankfurt, London, Paris) and three in Asia (Shanghai, Singapore, Tokyo). Each of these cities is a centre of commerce and finance and a magnet for companies. Each also has its share of corporate HQs and 'offers distinct advantages for doing business in a global economy', the study says. But the 11 were chosen simply because a lack of comparable and consistent data ruled out - for now - other worthy inclusions such as Dubai, Hong Kong, Johannesburg, Milan, Sao Paolo, Sydney and Tel Aviv, it points out.

What sets the study apart, however, is not the choice of cities but the indicators used. The nine indicators and 32 variables go beyond the traditional cost factors to 'provide a more broad-based picture of what drives business location decisions in the 21st century'.

Singapore ranked last in 'technology IQ and innovation' - perhaps the one indicator which, more than any other, defines, in the popular mind, the 21st century city of opportunity, the study says. The variables assessed here included percentage of self-employed and number of registered patents.

Singapore ranked near-last, unsurprisingly, in 'intellectual capital' - an indicator that looked at, among other things, the number of Top 500 universities in a city and number of Nobel Prize winners in the past eight years.

Similarly, Singapore ranked above only Shanghai for 'financial clout', which took into consideration things like the number of Fortune Global 500 headquarters and domestic market capitalisation. The other indicator where Singapore did poorly was 'lifestyle assets', covering entertainment, recreational space and number of hotel beds - though its ranking is expected to improve with the completion of the integrated resorts in 2010.

The one indicator in which Singapore emerged tops was 'ease of doing business' - it led across all four variables. But in three of these variables - severance laws, work-life benefits and ease of hiring - Singapore shared top spot with a good number of other cities. Only in 'corporate tax' was it the exclusive leader.

Among the other indicators, Singapore ranked a close third on 'demographic advantages' behind New York and Los Angeles. This assessed the 'right mix' of people to provide a city with advantages in terms of efficiency, diversity and depth of talent and skills.
Overall, the findings are not surprising - for instance, New York dominated the 'financial clout' indicator and Tokyo led in 'technology IQ and innovation'. But one might not have expected Frankfurt to be top for 'safety and security' or Atlanta for 'cost'.

Singapore, by the way, ranked joint-fifth on 'safety and security' with New York, pulled down by a low score for the number of hospital beds. Tokyo, Paris and Toronto ranked ahead. On cost, Singapore ranked behind London, Paris and Tokyo as the fourth most costly city to live in and do business. The US cities - Atlanta, Los Angeles and Chicago - emerged cheapest in terms of cost of living, purchasing power and cost of business occupancy.

Commenting on the overall findings, the report says that while predictably, 'early beneficiaries of globalisation' like London, New York, Paris and Tokyo are ''obvious leaders', emerging cities such as Shanghai, Singapore, Atlanta and Toronto 'pose serious challenges'.

'With increasing globalisation, most major cities are preparing themselves to attract an influx of business, to be cities of opportunities,' said Gautam Banerjee, executive chairman of PwC Singapore.

'In the past, Western cities would have led the race. But today, Asian cities such as Singapore and Shanghai are taking their place on the world stage and posing serious challenges to the reigning global powerhouses.'

The study does not declare any single 'model city of opportunity', he added. It merely represents a snapshot of business readiness at one moment in time. 'It shows how the 11 cities stack up and where each of them may want to invest in weaker areas. Almost every city demonstrates leadership in at least one variable, and at times, in more than one.

'While established leaders continue to make a strong showing, they cannot rest on their laurels. For the emerging cities, there are opportunities to learn from their more advanced counterparts. New centres of global commerce are emerging, and new choices and opportunities abound for businesses to consider.'

March 20, 2007