Just 100 cities account for 30% of the world’s economy, and almost all its innovation. Many of these engines of globalization, their enduring vibrancy coming from money, knowledge, and stability, are world capitals that have evolved and adapted through decades if not centuries of dominance (Source: Foreign Policy, August 2010).
Rich in networks and opportunities, these vast hyper-productive, hyper-consumptive centers act as magnets, sucking in talent and spewing out innovation: Hong Kong receives more tourists annually than all of India. Tokyo and New York have an estimated GDP similar to those of Canada or Spain, while London’s GDP is higher than that of Sweden or Switzerland. (Source: UN Habitat, 2010). Paris, Lisbon, Brussels, Budapest and Seoul all account for more than 25% of their respective national economies. (Source: UN Habitat, 2010).
In the coming decades, they will be joined by many new and/or bigger cities, and these cities will also be host to an increasing concentration of global and national wealth, talent and creativity:
- Indian cities are forecast to generate 70% of new jobs created to 2030, produce more than 70% of Indian GDP, and drive a near fourfold increase in per capita incomes across the nation. By 2030, India will have 91 million urban, middle class households, up from 22 million in 2010. (Source: McKinsey Global Institute, April 2010.)
- China’s Academy of Sciences estimated that for every 1% increase in urbanization, China can expect a 1.6% increase in the contribution made by domestic demand to China’s GDP. (Source: Deloitte, June 2010.)
- Shanghai’s economy represents over 13% of China’s total GDP, despite having less than 2% of the population. (Source: UN Habitat, 2010.)
- The number of African households with discretionary income is projected to rise by 50 percent over the next 10 years, reaching 128 million. By 2030, the continents’ top 18 cities could have a combined spending power of USD 1.3 trillion. (Source: McKinsey, June 2010.)
- Delhi, Shanghai, São Paulo and Moscow are each expected to reach a GDP in excess of USD 500 billion by 2025—more than the GDP of entire nations such as Indonesia or Belgium today. (Source: McKinsey, December 2010.)
The result? A global emerging middle class numbering some 2 billion, who currently spend USD 6.9 trillion a year. Over the next decade, this is forecast to increase to USD 20 trillion, double current US consumption. (Source: McKinsey, July 2010.)