COMPETITIVENESS OF CITIES
Competitiveness of cities is the ability of a city region to produce and market products when competing with comparable products from other urban regions. Local Economic Development refers to the “New Competitiveness,” or the belief that cities need to develop their own competitive strategies to prepare for the benefits and potential negative economic impacts of opening/accessing their markets to the world markets. The key reason for increasing urban competitiveness is to raise the standard of living for people who live in the urban areas. By increasing the economic productivity of an area and marketing its most productive goods and services, the community can develop and grow at its greatest potential. Economic investment, well targeted and strategically focused, is a proven method for improving the vitality of a community. Since strong export economies make the city more competitive, it is beneficial for the city to support the export economy of the city. Moreover, if a city increases its competitiveness, the standard of living for the people in the city region will rise.
World Bank Group : Urban Competitiveness Assessment in Developing Country Urban Regions: The Road Forward (2006) defined competitiveness can be measured through various lenses. Each measurement indicates a valuable incentive to invest in the area. If an area rates high in any of these categories, than that category is an asset of that area. These categories are not separate or interchangeable but are mutually necessary for determining urban competitiveness.
The following are measurements of competitiveness:
- Economic structure -- economic composition, productivity, output and value added, and investment-foreign and domestic.
- Territorial endowment -- non tradeables, such as location, infrastructure, natural resources, amenity, cost of living and doing business, and an urban region’s image.
- Human Resources -- extent to which activities in cities can move up value chains.
- Institutional milieu -- business culture
THE GLOBALISATION PROCESS FOR KUALA LUMPUR AS COMPETITIVENESS OF CITY TOWARDS A WORLD- CLASS CITY
The decline in trade barriers, the vast improvements in transportation and communication systems and networks over the last few decades have enhanced the volume of international trade in goods and services. Accompanying these are the enhanced international mobility of human resources, short and long-term capital and the growth in the number, strength and influence of transnational companies. The world economy has consequently become more integrated and global in nature. Major economic activities especially manufacturing have become more dispersed globally as processes within the production chain of increasingly more complex consumer and capital goods move to places that offer the best competitive advantage.
The global dispersion of production and marketing activities of transnational companies requires the global dispersal of management, control and support. This is achieved by the establishment of regional headquarters offices in strategically located cities which can offer suitable infrastructure, supporting services, living environment and other ancillary activities. Many cities that have assumed an important role by providing a base for the efficient conduct of international business have attained the status of ‘world cities. Examples of top ranked global city are London, New York, Paris and Tokyo. Others that play more of a regional or sub global role within the Asia Pacific Region are cities such as Hong Kong, Singapore and Sydney.
In addition to the globalisation trend, another factor that is and will influence the growth of the nation and that of Kuala Lumpur is the increase in the importance of the knowledge-based economic activities especially those relating to the development of information and communication technology (ICT). Industries that generate knowledge such as research and development in biotechnology, computer software multimedia applications, new technology for the computer and other hardware and industries that process distribute and manage information such as educational institutions, telecommunication and Internet systems, advertising and professional services are the key drivers of the Knowledge-Based Economy (K-Economy).