Forecast Economic Growth Across the World’s Major Cities
Euromonitor’s new database, Passport: Cities shows the world is becoming increasingly urbanised and all of the its major metropolises continue expanding in terms of GDP created in the city. Rates of growth, however, are very different across cities – while some are rapidly becoming wealthier, others are more saturated and have already lost growth momentum. If these cities continue following different growth paths, what will the urban world look like by 2020?
Taking a closer look at Euromonitor International projections of real GDP growth in the world’s top 80 cities (India, Middle East and Africa is excluded from the analysis) reveals the leaders in wealth and growth until 2020. While the wealthiest cities will remain in the Western world, growth opportunities can definitely be identified in Asian, Eastern European and Latin American cities. This analysis provides GDP growth decomposition of the fast-growing cities, highlights the main growth factors and makes conclusions about changing consumption patterns and demand in cities.
Source: Euromonitor International
Chart 1 demonstrates that over the upcoming decade all the cities will grow economically and the wealthiest cities today will remain on top of the list in 2020. Tokyo, New York, Osaka, Paris and Los Angeles will remain the largest markets of urban consumers. These cities have relatively wealthy consumers with their preferences and lifestyles already formed. As these cities are in a mature development phase, their forecast GDP growth rate is rather moderate.
Economic expansion will be more significant in other parts of the world. Asian cities will move up in the list particularly significantly. In terms of total GDP, by 2020 Shanghai will catch up with Houston, Beijing and Tianjin will rank above Sydney and Toronto, Jakarta will overtake Vienna, Montreal and Dublin, and Kuala Lumpur will leave Amsterdam, Copenhagen and Vancouver behind.
The general trend is that Eastern European and Latin American cities will also move up. Saint Petersburg will have GDP comparable to that of Gothenburg by 2020 and Prague will create more value added than Marseille or Manchester. Bogota will do better than Lyon and Buenos Aires will take over Montreal.