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South Africa’s city of opportunity

Quinton Bronkhorst

 ·23 May 2014

A new PwC report ranks the 30 biggest cities of opportunity in the world, including Johannesburg – which features not only for South Africa, but is also one of two cities from the African continent.

The report analyzed 30 cities – all capitals of finance, commerce, and culture — and, through their current performance, “seeks to open a window on what makes cities function best”.

Johannesburg ranks 8th out of the 30 cities of opportunity; however, rather counter-intuitively, the rankings work in reverse, with 30 indicating the top position, and one being the worst.

Thus, in real terms, South Africa’s economic hub ranks 22nd out of the 30 cities (8th last).

The only other African country featured on the list is Kenya’s capital, Nairobi, which placed last in the rankings.

“Nairobi is the first African city we’ve added since Johannesburg became part of the report in 2008. Kenya’s capital represents the dynamic growth and future prospects, both of its country and the continent as a whole,” PwC said.

Cities were assessed and ranked according to 10 indicators:

• The city as a gateway;
• Cost;
• Demographics and livability;
• Ease of doing business;
• Economic clout;
• Health, safety and security;
• Intellectual capital and innovation;
• Sustainability and the natural environment;
• Technology readiness; and
• Transportation and infrastructure;

Top 10 cities of opportunity

Rankings are from best (30) to worst (1)

Topping the rankings as the best city of opportunity is London, which ranked highest for technology readiness, economic clout and as a gateway city.

The city beat out New York, which ranked second best (top in 2013), as well as Singapore, Toronoto and San Francisco, which rounds out the five best cities of opportunity.

Although London takes the top spot in our rankings for the first time, it was evident from our last report that it was coming up quickly on New York,” PwC said.

“This year, London clearly takes the lead and is also the only city to finish first in three indicators. New York, on the other hand, while missing out on the top rank in all indicators, shows continuing superior consistency across most of the indicator categories.”

Johannesburg indicators

Rankings are from best (30) to worst (1)

Johannesburg, while still considered one of the 30 biggest cities of opportunity in the world, compares unfavourably against its global counterparts in most of the indicators covered by PwC.

The city does, however, perform strongly in at least one category, and hits the middle-ground in three others.

Joburg’s strongest indicator point is in cost.

The cost indicator encompasses the general cost of living in the city – and Joburg ranks highly for a corporate tax rate (6th best), cost of business occupancy (2nd best), cost of living (6th best) and purchasing power (4th best).

In this indicator, the city performed the worst in the iPhone Index category (Working hours required to buy an iPhone 4S 16GB), where it ranked 13th worst.

Los Angeles and Chicago were the only other two cities palcing higher than Joburg in term of city costs.

Joburg’s worst performing indicator – transport and infrastructure – ranked poorly due to the city’s low-ranked public transport systems (3rd worst), mass transit coverage (3rd worst), licensed taxis (6th worst), housing (7th worst) and construction activity (worst of all cities analysed).

Technology readiness

The technology readiness indicator is split into four datapoints, namely Internet access in schools, broadband quality, the digital economy and software development and multimedia design.

Johannesburg hit middle-ground performance in terms of the latter two categories, but performed extremely poorly in broadband quality and having internet access in schools.

Joburg’s broadband quality was ranked as 8th worst across all 30 cities, while Internet access at schools was stone last.

London was ranked as the best city overall in the technology indicator, followed by Seoul, Stockholm and Hong Kong.

London ranked highest for software development and multimedia design, while Seoul came out on top for broadband quality. Stockholm ranked highest for its digital economy and Singapore (8th best overall for technology) for its Internet connectivity in schools.

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