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The Economist Intelligence Unit (EIU) is a business within The Economist Group providing forecasting and advisory services through research and analysis, such as monthly country reports, five-year country economic forecasts, country risk service reports, and industry reports.
The business rankings model measures the quality or attractiveness of the business environment in the 82 countries covered by The Economist Intelligence Unit’s Country Forecast reports. It is designed to reflect the main criteria used by companies to formulate their global business strategies, and is based not only on historical conditions but also on expectations about conditions prevailing over the next five years. This allows the Economist Intelligence Unit to utilise the regularity, depth and detail of its forecasting work to generate a unique set of forward-looking business environment rankings on a regional and global basis.
Where will business opportunities in urban China arise as a result of rapid increases in populations, incomes, infrastructure and economic activity? Five years ago The Economist Intelligence Unit (The EIU) looked to answer that question. We devised an emerging city rankings index and published a report on the subject, CHAMPS: China’s fastest growing cities, which highlighted the rise of inland Chinese cities. It identified 2007 as a pivotal year for the economy, when inland China started to grow at a faster rate than the more developed coastal region. The aforementioned CHAMPS came not from the east, but from north-eastern, central and western parts of the country: Chongqing, Hefei, Anshan, Maanshan, Pingdingshan and Shenyang.
But five years is a long time for any economy, especially one changing as quickly as China’s. In the period since we published CHAMPS, a new national leadership has been installed, with a different set of priorities. In 2010 the government was still in stimulus mode, focused on responding to the events of the 2008-09 global financial crisis. Now, the priority is unwinding the credit bubble and excess industrial capacity that formed during that period. Structural reforms to put the economy on a more balanced, sustainable path, with growth driven by consumption rather than investment, have been promised.
These changes have persuaded us that it is an opportune time to update our analysis of China’s most promising cities. Prospects have altered dramatically over the past five years. Many have found themselves exposed to weaker domestic demand for commodities. Others have seen the bursting of real-estate markets. Some cities have taken to heart the central government’s advice to focus on industrial innovation, environmental sustainability and urban liveability. All have been grappling with the consequences of tighter restrictions on debt issuance and a crackdown on investment incentive policies.
Our emerging city rankings index aims to identify fast-growing cities. As such, it is based on growth indicators, such as changes in GDP, population, income and infrastructure. The index combines historic data with forecasts provided by Access China, our China Regional Forecasting Service.
1. The Democracy Index is based on five categories: electoral process and pluralism; civil liberties; the functioning of government; political participation; and political culture. Based on their scores on a range of indicators within these categories, each country is then itself categorized as one of four types of regime: “full democracies”; “flawed democracies”; “hybrid regimes”; and “authoritarian regimes”.2. Categorization of country based on overall score (on scale of 0 to 10)10≤Full Democracies≤88
Liveability assesses which locations around the world provide the best or the worst living conditions. The Economist Intelligence Unit’s liveability rating quantifies the challenges that might be presented to an individual's lifestyle in any given location and allows for direct comparison between locations.
Every city is assigned a rating of relative comfort for over 30 qualitative and quantitative factors across five broad categories: stability; healthcare; culture and environment; education; and infrastructure. Each factor in a city is rated as acceptable, tolerable, uncomfortable, undesirable or intolerable. For qualitative indicators, a rating is awarded based on the judgment of in-house analysts and in-city contributors. For quantitative indicators, a rating is calculated based on the relative performance of a number of external data points.
The scores are then compiled and weighted to provide a score of 1–100, where 1 is considered intolerable and 100 is considered ideal. The liveability rating is provided both as an overall score and as a score for each category. To provide points of reference, the score is also given for each category relative to New York and an overall position in the ranking of 140 cities is provided.
The liveability score is reached through category weights, which are equally divided into relevant subcategories to ensure that the score covers as many indicators as possible. Indicators are scored as acceptable, tolerable, uncomfortable, undesirable or intolerable. These are then weighted to produce a rating, where 100 means that liveability in a city is ideal and 1 means that it is intolerable.
For qualitative variables, an "EIU rating" is awarded based on the judgment of in–house expert country analysts and a field correspondent based in each city.
For quantitative variables, a rating is calculated based on the relative performance of a location using external data sources.
The analysis and content in the reports are derived from extensive economic, financial, political and business risk analysis of over 203 countries worldwide.
80–100 - There are few, if any, challenges to living standards;70–80 - Day–to–day living is fine, in general, but some aspects of life may entail problems;60–70 - Negative factors have an impact on day-to-day living;50–60 - Liveability is substantially constrained;50 or less - Most aspects of living are severely restricted.
Over the past decade or more, there have been several efforts to find out which are the world’s best-performing healthcare systems. The pioneer was the World Health Organisation (WHO), which used its annual World Health Report in 2000 to perform a systematic global analysis. The work that The Economist Intelligence Unit has previously carried out in the area of value-based healthcare has made it clear that value is a vexed term
"Hot spots is an EIU research programme, commissioned by Citigroup, which ranks the competitiveness of 120 of the world’s major cities. The research drew on two main initiatives: • A unique Index that compares 120 of the world’s major urban agglomerations across eight distinct categories of competitiveness and 31 individual indicators. These cities collectively represent about 29% of the global economy, with a combined GDP of US$20.2tr. A detailed note on definitions and methodology is provided in the appendix. • Hot spot conducted in-depth interviews with ten city experts, mayors and corporate executives, to get their insights on city competitiveness."