An open letter on cities in an interdependent world...

What makes a city thrive? It's a fascinating question. Today it's also an urgent one. This is especially true in the face of a pressing financial crisis. Cities offer the strength and resilience to lead our recovery through short-term stress and rebuild toward long-term growth.

Challenges do exist: Over half the world's people live in cities, and by mid-century the share is expected to reach 70 percent. Large population centers face intense risk from climate change, pandemics and shortages of food and water, among other emerging threats. And cities confront problems such as assuring health, safety, and security, and maintaining aging infrastructures.

But these challenges are outnumbered by opportunities: Cities will continue to stand at the crossroads of an interdependent world, producing the bulk of commerce, ideas and innovation in the form of financial and intellectual capital.

We live in a highly globalized economy where financial, commercial, and social interests flow together in a confluence of markets, travel and communications, cross-border investment and trade. A vital city is a locus of activity in its region. In cities like New York, London, Paris and Tokyo—and increasingly others—that region is the world.

It's plain that the health of cities drives the wellbeing of businesses, people and nations.

A shared future

Today, as developed and emerging economies navigate a difficult economic period, cities will lead the recovery with long-term strengths that transcend short-term difficulties. It's clear that global solutions are required for global problems. Neither the direction of globalization nor the growth of cities is likely to falter.

We are in it together for better or worse, opportunity or risk. It's a rooted and healthy reality at the heart of this study: The world's interests have fused. As such, Cities of Opportunity closely examines 20 cities that serve as hubs of finance, commerce and innovation in their regions and whose stakeholders span the world.

Working together, PwC and the Partnership for New York City investigated a robust range of 51 current, credible and unbiased variables to see how cities are advancing in the 21st century and what actions are helping them to thrive. We particularly sought to look deeper than the obvious front-runners and to learn from successes, not to proclaim "winners." Our goal is to provide all cities with ideas on developing their own pathways to improvement.

The pulse of urbanism

The results, in many cases, confirm that traditional leaders still maintain advantages. New York, London, Paris and Tokyo top a number of overall indicators and individual variables on the strength of their historical achievements, as well as actions now underway. For instance, New York is notable for its base of intellect and innovation, which is likely to prove critical in navigating past current difficulties and creating new growth opportunities. London leads in its openness to business, providing a powerful magnet with its size and welcoming the global economy with its diversity, brand and policies.

Cities like these understandably still hold beacons for progress. Visionary people invested tremendous work and energy over many years to build infrastructures of education, health, transportation, public works, buildings and, recently, e-readiness. Today's most powerful cities offer enduring strength and resiliency to bounce back from the current downturn.

But emerging cities are making their own investments to challenge the established order. For some, like those in China and India, today's prosperity represents a renaissance, returning to a time when they were the established order, drawing the world to their riches. Already Beijing ranks right behind London and ahead of New York, Paris and Tokyo in transportation and infrastructure. San Paulo, Dubai and Mumbai lead the world in buildings under construction. Shanghai's intellectual capital puts it among the top cities. Shanghai and Beijing lead the list of working age populations per capita, paving the way for the future.

Looking deeper

Interestingly, the study also finds a number of cities that "pound for pound" offer more opportunity than meets the eye when considered relative to their qualities and size. These cities are setting new standards and doing things right with forward-looking policies and programs to promote growth in a globalized world.

For example, Chicago and Toronto are noteworthy for strong purchasing power, diversity and quality of life, among other things. Frankfurt, the smallest city studied, sets a standard for sustainability. Houston, Chicago and Los Angeles fare particularly well on cost competitiveness.

Finally, while the study confirms some perceptions, it also offers new insights. Both emerging and mature cities have been busy in the last few years building and diversifying their infrastructures and economies.

The world's great cities will continue to pave the way to a prosperous future.
In this light, all these cities of opportunity offer lessons that apply well beyond their borders.

Dennis M. Nally Chairman and Senior Partner PwC

Kathryn S. Wylde President and CEO, Partnership for New York City