Traditionally, city is the center for business such as market, manufacturing, trade and banking but with globalization, some cities now are “specialized” in certain function to contribute more to the world economy and draw more international companies to come in and operate. Global city is really an evolution of Technology parks where it grows from a limited designated area then spread all over a city as more businesses are drawn in due to the “Specialization” of the economic development.
There are four types of “Global city”: A global location focusing on finance, banking and trading where many international financial companies move in and operate such as Shanghai, Singapore, Hong Kong and New York. A global location focusing on information technology that provide services globally, this type of city is now the leading economic sectors. (For example, Bangalore, Dalian, San Jose) A global location focusing on manufacturing products, including both the old manufacturing such as equipments, machinery and the new technology production such as electronics. (For example Shenyang, Seoul and Tokyo) A global location focusing on research and innovations where global laboratories operate. (For example Boston, San Francisco, London). Depending on local government who has vision for their cities, certain type of “Global city” can take shape where specialized industries can structured and operate accordingly and emerge as transnational locations for foreign investment, for the production, services, financial, and for various international markets.
As highly specialized centers in the structure of the world economy, global cities are well known for their economic power. They become the locations for global companies, institutions, and organizations to move in to operate, manage, and provide certain economic aspects across the world. Basically, global cities perform a dual role at the intersection of the global economy and the host nations. What contributes to growth in these global cities also contribute to growth in the host nations. As global cities are places of production and distribution of products and services globally, it also accumulate a lot of investment capitals where distribution of jobs and financial circulation are organized and managed.
While each country may have different reasons for establishing global cities, generally the primary goal is to increase the number of “entrepreneurial, knowledge-based small and medium-sized companies” in an global economy because these companies are the backbone for the growth of the local economy. Developing countries with no local expertise in technology, may designate a city to focus on a specialty, for example “Information technology city” to attract foreign direct investment and to create more local jobs and tax revenues. There are several successful global models such as Bangalore, Hyderabad, Dalian, Shenyang, and Shanghai, where these cities contribute significantly to the country’s economy.
The infrastructure needed to support a global city vary widely based on the specialization. For a city want to specialize in information technology (IT), good Internet connectivity is a key requirement. This generally extends to the availability of fiber optics networks offering at least megabit transmission speeds and redundant connectivity, either through multiple fiber providers or through a combination of different transmission media, such as fiber optic cables and satellite transmission. Additionally, a reliable and abundant power supply is also necessary to run large data centers, which typically consume 50W/square foot. With the average data center estimated at 30,000 square feet, this corresponds to 1.5 MW per data center as a minimum. Of course, global city must have more than just good infrastructure but also skilled workforce. Another key requirement is having several universities with certain specialization in the surroundings to provide the needed skilled workers.
Given the competitive nature of business today, another important factor of a global city is proximity to transportation infrastructure, particularly airports, seaports, and highways. Frequent flights and short distances to major international cities are a prerequisite to attract significant foreign investment. Public transportation and rail networks can also be important to ease traffic problem. Special-purpose facilities may also be needed depending on the specialty of the global city’s activities and the needs of the business. For intensive manufacturing operations such as semiconductor chip manufacturing, access to chemical suppliers, metals and a large supply of fresh water are important. For technology area, a location with several universities with strong training programs to provide highly skilled workers and basic services with convention centers, hotels capable of hosting international conferences are key factors to draw foreign investment.
There is another side of global cities where social polarization does happens in occupational and income structure. This view considers that people who work in global city are mostly well-educated, socially mobile, and earn high incomes than those who live in nearby cities. Because global cities are the command centers for the world economy, workers who have received higher education continue to earn more while people who do NOT have the education and skill will not have much chance and the social inequalities increase. A low-skilled and low-paid working class that support global cities do exist alongside, but usually in a separated from the professionals. In other word, Global city is a place of exceptional wealth and affluence, but they are also places of severe disadvantage and deprivation. To reduce the chance of conflict, a strong vocational education to develop supporting workers for better wages along side with the higher education for skilled workers would be highly desirable.
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Prof. John Vu, Carnegie Mellon University
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Source: SEGVN