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Sydney Ranks 14th as MasterCard Worldwide Center of Commerce

New MasterCard Research Explores Strategic Role of Cities in the Global Economy

Sydney Ahead of Melbourne as a Worldwide Centre of Commerce

Sydney, 12 June 2007 - MasterCard Worldwide today announced the inaugural findings of its groundbreaking research effort, the MasterCard Worldwide Centers of Commerce Index™, ranking Sydney 14th in the world and 5th in Asia/Pacific. London beat New York, to take first position, followed by Tokyo, Chicago and Hong Kong.

Melbourne was placed 34th globally and 7th in Asia/Pacific. Contributing strongly to Sydney’s dominance over Melbourne was the presence of the Australian Stock Exchange, Reserve Bank of Australia and Futures Exchange in the city hub.

The Index was designed to provide insights and knowledge into how cities influence the global economy. To determine the cities in the ranking, a panel of leading global experts in economics, urban development and social science identified and ranked 50 cities around the world based on six measurement dimensions consisting of over 100 data points. The full report is available at www.mastercardworldwide.com.

"Sydney and Melbourne are two of the world's most vibrant cities and this MasterCard Index proves they are more than just great places to live, they are also key Centers of Commerce," said Leigh Clapham, executive vice president, Australasia, MasterCard Worldwide.

"The index provides the opportunity to understand how Australian and international cities contribute to and connect with the global market place, which is crucial for success in today's economy, plus it helps fuel the friendly competition between a variety of cities."

The transformation of cities into global centres of commerce has been fuelled in part by rapid urbanisation. In terms of population size and economic activities, many cities today are far larger than a significant number of sovereign states and more important than ever before. The research report establishes that today, many of these metropolises are "global cities" that perform critical functions connecting markets and commerce globally. In essence, they are nodes of connectivity through which global commerce can take place.

"The trend of commerce becoming more knowledge-driven and less tangible has actually elevated the role of today's cities, positioning them as hubs of complex circuits that fuel the globalised economy and provide connections through which true global commerce takes place," said Dr.Yuwa Hedrick-Wong, economic advisor, MasterCard Worldwide, who led the knowledge panel for the MasterCard Worldwide Centers of Commerce Index.


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Key Findings

Key highlights from the Index include:

  • Key nodes of commerce "Down Under". Sydney and Melbourne, two of Australia's most vibrant cities prove that they are not just great places to live but are also key centres of commerce. Sydney, home to Australia's stock exchange, ranked 14 overall in the Index, while Melbourne ranked 34.
  • London: The world's leading Center of Commerce. With a flexible operating environment for business, strong global financial connections and exceptionally high levels of international trade, travel and conferences, London secures the top spot in the Centers of Commerce Index. The city outperforms New York in four of the six measurement dimensions, and scores significantly higher than other European cities.
  • National economic factors, market regulations place New York behind London. Once considered the unchallenged financial capital of the world, New York cedes to London a key dimension measuring financial transactions primarily because bond market regulations in New York affect the volume of listed sales. New York's score is also impacted by the less stable US economy and the more volatile US dollar.
  • Tokyo's powerhouse economy leads to top ranking in Asia Pacific. Tokyo, the leader in its region and number three overall, boasts the Nikkei 225 Index, the most patents and daily newspapers per person, and an air traffic hub second only to Hong Kong.
  • Three onetime "Asian Tigers" make the top ten. Hong Kong, Singapore and Seoul all rank among the top 10 Centers of Commerce, with Seoul scoring high marks for its higher education system and patent output, while Hong Kong and Singapore boast top rankings for the strength of their business climate and their prominence in the global financial network. Singapore also rates high for government policies that favor international business and trade.
  • Hong Kong & Singapore maintain tight economic rivalry. Hong Kong edges out traditional economic competitor Singapore for fifth placing in the Index. Singapore, which ranks sixth in the Index, had an Index value only 0.37 points less than Hong Kong. This was partly because of the smaller number of equity transactions that took place in the Republic as compared to Hong Kong. Hong Kong also scores better in measures related to its business climate.
  • Emerging growth engines, China and India, make their mark. China cements its growing regional importance with three cities represented in the Index - Hong Kong #5, Shanghai #32 and Beijing #46. This is the largest representation of cities from one country in Asia/Pacific. The Indian city of Mumbai shone in the dimension concerning financial transactions, coming in 10th globally.
  • Strong business climate makes Dubai the Middle East leader. The region's air and cargo traffic hub, Dubai also claims a flexible business climate that makes it optimal for growing companies. The city ranked 37 in the Index.

Methodology

The Worldwide Centers of Commerce Index is compiled from research by a panel of eight independent economic, urban development and social-science experts from leading academic and research institutions around the world, led by Dr. Hedrick-Wong. To form the index, the panel first identified 63 cities around the world that met their initial criteria.

Cities were then rated on the six dimensions:

  • Legal and political framework
  • Economic stability
  • Ease of doing business
  • Financial flow
  • Business center
  • Knowledge creation/information flow

This entailed measuring a number of equally weighted, relevant indicators and sub-indicators that aggregate available data on region-specific procedures, costs and ratings, as well as criteria related to quality of life, access to technology, city livability, logistics and knowledge creations and creativity. In total, over a period of four months, the panel evaluated six dimensions, 41 indicators and more than 100 sub-indicators to derive an Index ranking for each city, a process that exceeds traditional measures used to gauge worldwide financial and business activity.

About the MasterCard Worldwide Centers of Commerce Knowledge Panel

Leading the Worldwide Centers of Commerce program is Dr. Yuwa Hedrick-Wong, economic advisor, MasterCard Worldwide. With more than 25 years experience as an economist, business strategist and writer, Hedrick-Wong is one of the foremost experts on Asian economic trends and has counseled senior executives and board members at more than 50 global companies. To assist him in this research, Hedrick-Wong assembled a panel of leading experts in economics, urban development and social science from around the world, including:

  • Professor Fan Gang, Director, National Economic Research Institute, Beijing
  • Manu Bhaskaran, Partner/Head, Economic Research, Centennial Group, Singapore
  • Dr. Michael Goldberg, Professor Emeritus, Sauder School of Business, University of British Columbia
  • Professor William Lever, Emeritus Professor of Urban Studies, University of Glasgow
  • Professor Maurice D. Levi, Bank of Montreal Professor of International Finance, University of British Columbia
  • Dr. Anthony Pellegrini, Partner/Director of the Urban and Infrastructure Policy and Finance Practice, Centennial Group, Washington, DC
  • Dr. Saskia Sassen, Ralph Lewis Professor of Sociology, University of Chicago and Centennial Visiting Professor, London School of Economics
  • Professor Peter J. Taylor, Co-Director, Globalization and World Cities Research Group and Network, Loughborough University, UK

Note to Editors: Full details of the Index composition, including indicators and sub-indicators used for calculating the index value, are detailed in the Index report titled, MasterCard Worldwide Centers of Commerce Index™, 2007. A study on the significance of cities is found in the Insights report, titled, MasterCard Worldwide Global Centers of Commerce™ Insights 2Q, 2007: The Dynamics of Global Cities and Global Commerce. Both these reports are available at www.mastercardworldwide.com.

The ranking of the top 50 MasterCard Worldwide Centers of Commerce are found on the following pages.

The Top 50 MasterCard Worldwide Centers of Commerce

* 1: Legal and Political Framework
2: Economic Stability
3: Ease of Doing Business
4: Financial Flow
5: Business Center
6: Knowledge Creation and Information Flow

Rank City Country Index Value Dimensions*
1 2 3 4 5 6
1 London UK 77.79 84.11 93.54 87.87 82.86 71.75 52.72
2 New York USA 73.80 86.60 90.64 87.36 68.58 62.13 61.55
3 Tokyo Japan 68.09 83.88 88.03 85.52 53.39 59.54 55.94
4 Chicago USA 67.19 86.60 90.64 86.08 55.84 53.88 50.71
5 Hong Kong China 62.32 77.57 85.94 87.07 38.06 71.89 27.31
6 Singapore Singapore 61.95 88.12 91.64 88.24 32.59 66.16 28.78
7 Frankfurt Germany 61.34 84.68 92.63 82.64 53.50 50.91 25.67
8 Paris France 61.19 74.43 93.32 82.15 43.22 55.21 39.57
9 Seoul Korea 60.70 74.63 86.42 73.83 53.00 51.37 42.95
10 Los Angeles USA 59.05 86.60 90.64 87.30 18.80 56.19 46.03
11 Amsterdam Netherlands 57.30 82.49 91.86 82.41 32.89 53.03 28.04
12 Toronto Canada 57.11 85.83 88.06 88.85 30.79 49.14 27.26
13 Boston USA 56.47 86.60 90.64 86.77 21.94 41.48 46.51
14 Sydney Australia 56.26 82.58 86.40 84.56 37.61 47.54 23.24
15 Copenhagen Denmark 56.14 88.73 92.64 87.44 33.75 38.95 28.28
16 Madrid Spain 56.06 81.30 94.52 79.44 41.22 44.03 23.99
17 Stockholm Sweden 54.51 88.78 89.77 85.93 26.72 36.79 34.36
18 San Francisco USA 54.36 86.60 90.64 87.40 13.00 45.11 39.80
19 Zurich Switzerland 54.33 83.42 92.42 82.84 32.48 35.09 33.20
20 Atlanta USA 54.19 86.60 90.64 84.36 9.40 48.34 43.06
21 Miami USA 53.76 86.60 90.64 85.40 7.80 50.64 38.12
22 Houston USA 52.96 86.60 90.64 84.21 8.60 44.76 41.57
23 Washington D.C. USA 52.68 86.60 90.64 87.08 6.40 42.74 42.08
24 Berlin Germany 52.24 84.68 92.63 82.23 19.31 39.27 32.33
25 Milan Italy 52.23 72.67 93.06 76.00 39.09 42.05 16.27
26 Munich Germany 51.85 84.68 92.63 82.39 20.00 40.51 27.03
27 Montreal Canada 51.35 85.83 88.06 88.48 10.99 44.11 25.93
28 Vancouver Canada 51.10 85.83 88.06 89.85 8.40 43.63 26.84
29 Brussels Belgium 51.05 70.82 92.89 85.13 21.05 41.88 23.80
30 Vienna Australia 50.94 83.32 93.93 82.13 19.47 37.39 26.73
31 Dublin Ireland 50.72 79.30 86.34 87.69 19.24 41.41 20.46
32 Shanghai China 50.33 68.63 79.40 64.46 38.30 52.09 17.16
33 Barcelona Spain 50.15 81.30 94.52 79.44 20.51 39.31 22.01
34 Melbourne Australia 48.89 82.58 86.40 83.47 8.00 45.20 22.47
35 Geneva Switzerland 48.05 83.42 92.42 82.46 8.80 31.50 31.94
36 Bangkok Thailand 47.96 68.01 88.13 68.71 23.21 49.50 16.27
37 Dubai UAE 46.61 78.04 75.63 73.76 23.04 48.82 4.24
38 Kuala Lumpur Malaysia 45.82 64.74 84.67 76.04 25.80 39.69 7.90
39 Santiago Chile 44.56 73.54 82.40 74.91 21.13 29.48 17.81
40 Budapest Hungary 43.75 61.99 82.25 75.10 23.08 30.67 15.48
41 Prague Czech Republic 43.55 70.00 89.47 74.72 19.31 30.49 10.63
42 Mexico City Mexico 43.35 66.44 81.18 67.48 25.73 33.50 12.90
43 Rome Italy 43.18 72.67 93.06 73.69 6.80 33.77 18.39
44 Tel Aviv Israel 43.00 63.17 82.20 76.54 17.50 32.48 13.46
45 Mumbai India 42.70 50.76 90.51 55.09 38.71 30.34 14.73
46 Beijing China 41.94 68.63 79.40 60.20 13.40 38.95 22.41
47 Johannesburg South Africa 41.37 62.68 69.77 76.71 24.48 31.28 3.22
48 Sao Paulo Brazil 41.14 49.83 67.83 63.06 31.43 34.23 14.50
49 Warsaw Poland 40.56 58.71 79.85 70.25 21.11 26.02 14.30
50 Moscow Russia 39.80 49.42 69.82 58.09 27.11 33.66 18.04

About MasterCard Worldwide

MasterCard Worldwide advances global commerce by providing a critical economic link among financial institutions, businesses, cardholders and merchants worldwide. As a franchisor, processor and advisor, MasterCard develops and markets payment solutions, processes over 16 billion transactions each year, and provides industry-leading analysis and consulting services to financial institution customers and merchants. Through its family of brands, including MasterCard®, Maestro® and Cirrus®, MasterCard Worldwide serves consumers and businesses in more than 210 countries and territories. For more information go to www.mastercardworldwide.com.


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Contacts:

Melissa Devine, 02 9818 0950, mdevine@ppr.com.au
Michael Pooley, 02 9818 9310, mpooley@ppr.com.au