Tel Aviv sky 521.
(photo credit: Stephane Zerbib)
Tel Aviv has been ranked No. 34 out of 40 cities in the annual Knight Frank global cities index, which was released Wednesday, one place lower than last year and three below Cairo.
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The Global Cities Survey, which was created by multinational real-estate and property-services firm Knight Frank in 2008 to monitor city-level power shifts, measures 40 major cities in terms of their provision of investment opportunities and influence on global business leaders and the political elite.
New York, London and Paris maintained their positions as the top three cities. However, the survey forecast a significant shift in the east-west power balance within 10 years, with Shanghai, Beijing, Hong Kong and Mumbai all expected to enter the top seven cities by 2021, while the influence of Paris, Brussels, Los Angeles and other Western cities wanes.
Of the four categories by which the survey judges cities, Tel Aviv’s best performance was in quality of life, in which it was ranked No. 17, just behind Chicago and Seoul but ahead of Singapore, Milan and Miami. The top three cities in that category were Paris, Berlin and Toronto.
Tel Aviv was No. 26 for political power and No. 37 for knowledge and influence, ahead of Bogota, Rio de Janeiro and Johannesburg. It was ranked last in economic activity.
According to the methodology presented by the report’s authors, the knowledge and influence category considers each city’s knowledge base, assessing educational status and ranking of educational facilities. The index takes into account how each city is able to transmit its knowledge, by assessing the number of national and international media groups and news bureaus and the international market share of locally based media.
Economic activity includes not only economic output and income per head, but also the number of international business headquarters in each city.
It is also worth noting that Tel Aviv, with a population of about 400,000, and Zurich are among the smallest cities on the list, whereas most of the cities on the list have millions of inhabitants.
The Global Cities Index was released as part of Knight Frank and Citi Private Bank’s annual Wealth Report, which publishes data from several indexes, including a poll of about 5,000 high-net-worth individuals.
An attitudes survey, which was conducted prior to the demonstrations in Tunisia last December that sparked a wave of rebellions against Arab regimes, found that investor concern about the state of the global economy and political instability had increased compared to one year earlier.
Citi Private Bank senior political analyst Tina Fordham said political risk analysts had been forced to change their strategies since the global financial crisis. They now had to deal with a new reality in which the role of the state has expanded in the developed world, while events in the Arab world have simultaneously countered the myth of political stability in emerging markets, she said.
“The uprisings in the Middle East and North Africa are a reminder that economic growth doesn’t necessarily ensure political stability, especially where gains are overly concentrated,” Fordham said. “Rising food prices – one trigger for the recent unrest – remain a risk factor that could see a return to the food riots of 2008.”
“But typically, it is the middle classes and not the poor who spearhead revolutions,” she said. “The same population growth and new middle classes in the emerging markets that prompted so much foreign direct investment and helped power growth could now bring trade-offs.”
According to the report’s wealth-distribution model, the huge increase in Chinese billionaires means that Asia will soon challenge North America as the source of the most of the wealth of high-net-worth individuals.
Although still lagging behind North America and Europe in terms of wealth distribution, the report said, Asia is fast catching up and today contains two of the four biggest wealth markets in the world: Japan, with a net worth of $4 trillion, and China, with a net worth of $2t.