Making the Case for a Strong Dublin

Activating Dublin

Making the case for a strong DublinNovember 2013

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Presentation Overview

• Discuss the international perspective on cities & global trends

• What this means for Dublin and Ireland• Conclusions / Discussion

Jamie Cudden – Activating Dublin. Twitter: @jcudden

Why do Cities Matter?

Many observers talk about the 21st century being the century of cities. The world is not flat .

For the first time in 2010 over half the world's population now live in cities. 3.8 billion by 2015 (53%)

They drive global GDP. Generating more than 80 per cent of global GDP today.

Cities occupy just 2% of the world’s land surface yet they house more than 50% of the world’s population

Jamie Cudden – Activating Dublin. Twitter: @jcudden

Importance of Cities“ Most OECD metro-regions have a higher GDP per capita than their national average (66 out of 78 metro-regions), a higher labour productivity level (65 out of 78 metro-regions) and many of them tended to have faster growth rates than their countries”

“Cities such as Budapest, Seoul, Copenhagen, Dublin, Helsinki, Randstad-Holland and Brussels that concentrate nearly half of their national GDP whilst Oslo, Auckland, Prague, London, Stockholm, Tokyo, and Paris account for around one third”

"Successful cities attract talented young highly-skilled workers, are centres of

innovation and entrepreneurship and are competitive locations for global and

regional headquarters. The proximity of universities to research and production facilities means cities are where new

products are developed and commercialised. More than 80% of patents

are filed in cities.“OECDSource: OECD, competitive cities in the

Global economy

Jamie Cudden – Activating Dublin Twitter: @jcudden

We live in a spiky world

Source: Atlantic, The World is Spiky, 2005

“ Well over half of the world’s population now lives in cities, generating more than 80% of global GDP.

Already, global business is beginning to plan strategy from a city, rather than a country, perspective.

Given the rapid growth and development of many cities, particularly in emerging markets such as China and India, competition between them for business, investment and talent will only get fiercer”

Source: Economist Intelligence Unit 2011 / Citi Bank

Leading global cities are New York, London, Singapore and Hong Kong


“ While $8.1 billion was spent on smart city

technologies in 2010, by 2016 that number is

projected to reach $39.5 billion”

Source: ABI Research 2011

Dublinhttp://www.citigroup.com/citi/citiforcities/pdfs/hotspots2025.pdf

Dublin projected to be 22nd most competitive global city in the Overall 2025 City Competitiveness rankings table

120 cities ranked


http://www.citigroup.com/citi/citiforcities/pdfs/hotspots2025.pdf

The Top 600 Global Cities

Top 600 cities account for 60% of global GDP yet hold about 20% of the population


City GDP 2005

Source: McKinsey CityScope


City GDP 2025

• Over 100 new Chinese cities to enter the top 600 by 2025

• Not just megacities…


Cities represent the Biggest Commercial Opportunity in the coming decades

• One-third of the world’s population—2.6 billion people—live in emerging-market cities, and by 2030, that number will increase by an additional 1.3 billion.

• Middle-class population expected to rise 70 percent between 2010 and 2015. Effecting everything from where these individuals live to how they consume.

Source: Boston Consulting Group

• Metros drive economic growth, action shifts to Asia, Latin America, & Eastern Europe:

• 90% of the fastest-growing metropolitan economies among the 200 largest worldwide were located outside North America and Western Europe.

• By contrast, 95% of the slowest-growing metro economies were in the United States, Western Europe, and earthquake-damaged Japan.

Source: Brookings Metro Monitor, 2011

Source: Dublin Chamber of Commerce 2010, Making the Case for Dublin

What does this mean for Dublin?

“Dublin operates in an intensely competitive world where increasingly it is cities (and not states) competing for investment, talent, tourism, international students”


What does this mean for Dublin?Global trends:

• Increasing levels of human mobility and demand for skills (expected to double by 2020)

• Growth projections for international students (to triple by 2020) and transnational tourism (+75% by 2020)

• About taking these opportunities• Markets and cities that have never heard of Dublin

Sources:

• Dirks. S., Keeling, M and Gurdgiev, C., 2010, Smarter Cities for Smarter Growth, IBM Institute for Business Value. • UN World Tourism Organisation (2009)• Young-Chul Kim (2009): The Asia-Pacific education market and modes of supply. In: The Asia-Pacific education

market, eds. William Tierney and Christopher Findlay, quoted in Hawthorne 2008.


Dublin: A magnet for FDIPwC’s Global 100 Software Leaders

1 Microsoft2 IBM3 Oracle4 SAP5 Ericsson6 Symantec7 HP8 EMC (excl. VMware)9 CA Technologies

10 AdobeSource: Data was compiled by the Global Software Business Strategies Group at IDC.

Fortune 500 US Companies 2013

1 Apple 2 AT&T3 HP4 Verizon5 IBM6 Microsoft7 Amazon.com8 Dell9 Intel

10 Google

In Dublin

in Ireland

•9 of the top 10 Global Software Leaders are in Dublin and 8 of the top 10 US companies are here

•Dublin has one of the best track records for FDI in Europe. Voted the ‘Best to Invest’ European Metro in 2012 and third best in 2013.


IDA investment locations – concentrated in Dublin

Investment Locations by key (Gateway) areas

Williams, B., Foley, W., Cudden, J. & Shahumyan, H.


Example of the tech / Internet investment in Dublin



Source: Frontline Ventures Ireland Tech Start Up Guide


IDA investments and jobs

- Dublin continues to dominate, grabbing 6,389 or 54% of the jobs. - Dublin was far ahead of the second-best performing centre, Cork — where 1,979 or 17% of the overall FDI jobs were located. - Galway secured 859 jobs, Limerick 400, and Louth 386.


IDA Annual Report, 2013

• “The Greater Dublin Region in Ireland is the best European region of the future for economic potential, on account of the large amount of FDI per capita it has attracted, especially greenfield FDI projects in R&D. The banking crisis in Ireland does not seem to have affected FDI into the Dublin region; project numbers were up 15% year on year in 2011, following the banking bailout at the end of 2010. Investors in Ireland benefit from a favourable corporation tax regime; 20% of FDI projects in the Greater Dublin Region in 2011 were classified as headquarters”

• http://www.fdiintelligence.com/Rankings/European-Cities-and-Regions-of-the-Future-2012-13

http://www.fdiintelligence.com/Rankings/European-Cities-and-Regions-of-the-Future-2012-13

Talent and EducationDublin and a few key Gateways are the centres for talent and opportunity

The Economist Intelligence Unit ranked Dublin number one in having the best “human capital” in the world

Dublin is the only Gateway with more graduates than it produces

Dublin region is the leading education location in Ireland, with 50 percent of all students in the university sector based there, and 63 percent of all PhD students


Talent Attraction High skill work permits issued to Non EU persons

http://www.siliconrepublic.com/careers/item/34899-number-of-irish-work-permit

Dublin accounted for over 60% of the total..


“75% of Google staff have relocated from overseas to work in Dublin” - John Herlihy, VP of Online Sales and Operations, Google Ireland

“Competition for Foreign Direct Investment is significantly increasing and the availability of skilled labour is, amongst other things, one of the main deciding factors when companies are choosing a location for their overseas investments. The fact that Ireland continues to lead the way in availability of skilled labour adds significantly to our reputation as a host for FDI” – Barry O'Leary, CEO, IDA Ireland

http://www.siliconrepublic.com/careers/item/34899-number-of-irish-work-permit

Start up ecosystem rankings – cities not countries

- Dublin not in the top 20

Start up phenomenon....Two major global trends in tech start ups is the urban shift in the underlying model as well as the globalization of start-ups which creates great opportunities for Dublin

-Dublin is the centre of the start up scene in Ireland-Needs attention to make it a world leader

Source: Martin Prosperity Institute, 2013

http://online.wsj.com/article/SB10000872396390444914904577619441778073340.html

Spatial Representations of Population Change 2002-2011 and Job Density

Job Density in Ireland based on 2006 Census data

(Morgenroth, 2011)


Property Market – Dublin v Rest

- Pressure is building on the Dublin region.....


CSO, 2013

Latest Labour Force Stats

*unadjusted figures Source: CSO, 2013

Unemployment 10.5% in Dublin versus 13%


Business Locations

• Mapping of business locations across two High value sectors• Hot Spots in a few Key Gateways – Galway,

Cork, Dublin and Limerick

ICT Financial and Insurance Activities


•Mapping of Geo Directory Businesses (2012)

Agriculture, Forestry and Fishing Accommodation and Food Services

Different Strengths in Different Areas.....need to play to the strengths of the regions...


•Mapping of Geo Directory Businesses (2012)

Tax contribution

Data on tax contribution for the year 2008 delivered in response to a Parliamentary Question in 2010 found that citizens or companies located in Dublin[1]

– contributed 55.6% of all VAT in 2008, followed by Cork at 8.8% and Kildare 3.4– paid 62.4% of all Corporation Tax yielding €3.2bn out of a total tax of €5.1bn in

2008. – paid 50.6% of state PAYE in 2008 producing an estimated exchequer revenue

of €5 billion for the Government.– paid 38.8% of non-PAYE income tax followed by Cork at 11%, Galway 4.5%,

Kildare 4%, Limerick 3.9%, Meath 3.5%, Wicklow 3.4% and Tipperary 3.0%.– contributed 41% of all Capital Gains Tax intakes– Figures taken from response to parliamentary question July 2010 [2]

[1] A number of caveats are attached to these figures due to reporting discrepancies such as Corporation Tax being collated based on the county address of company HQ or the relevant branch for tax purposes.

• [2] http://www.leovaradkar.ie/?p=1076


Opinion on Dublin - SWOTSTRENGTHSAbility to attract, produce and retain talent- critical mass of talentGood business environment – cluster effectA city of global scale and/or importanceRelatively good quality of livingMuch improved transport infrastructure

WEAKNESSESHigh unemployment/Youth UnemploymentInterregional competitionOutdated planning and governance structuresInadequate ConnectivityEconomic crisis

OPPORTUNITIESAttracting new investment/entrantsIncreased collaboration across public and privateGrowing new creative industryEnhancing the tourism potentialEnhancing the built fabric and unlocking underdeveloped areasConnecting to emerging cities

THREATSLack of investment in critical infrastructure (water, rail)Skill shortagesCompetition from emerging marketsFactors undermining competitiveness-CongestionAntisocial behaviour

* Based on interviews with over 40 key stakeholders across the Dublin Region


Conclusions• By international standards Dublin is a medium sized or small

city, ranked 77th out of 78 cities in terms of population by the OECD.

• Dublin accounts for almost half of national GDP and its effective management and continued success is critical for the performance of the entire economy

• Dublin and its commuter counties face increased pressures as urbanisation and migration towards the east coast continues

• The Dublin region is expected to take a projected population increase of over 200,000 persons from 2010 to 2022 the Mid East has been apportioned 100,000 in the same period.


Conclusions• Dublin has the critical mass of skills and workforce to

attract international investment• Evidence base shows that Dublin has been resilient in

certain sectors such as ICT and Finance, actually growing the numbers of enterprises notably in ICT.

• Key areas such as transport, water and broadband infrastructure require future proofing to maintain the competitiveness of Dublin.

• International benchmarks indicate a need to improve our performance in these areas to maintain competitiveness


National Competitiveness Council

"As Ireland’s only city of international scale, continued investment in Dublin is necessary to maintain and improve its position as an internationally competitive location. A competitive Dublin can serve to strengthen the performance and attractiveness of other Irish cities and provide them with opportunities that may not be accessible otherwise“

NCC competitiveness council 2010

Recommendations

• A succession of ignored policy recommendations from the 1960’s on the form, funding and financing of local government....

• These reports generally support the interview opinion that local government should have greater levels of autonomy with the assigning of revenue generation powers to local government linked with expenditure responsibilities.

• Common messages included continued potential of the city region, inadequate broadband, need for greater levels of collaboration, threat of congestion, brownfield regeneration, skill and language deficiencies and the challenge of maintaining competitiveness......


Recommendations

• All the national and international evidence demonstrates that:

• It should be clearly recognised that Dublin is a unique case and national asset.

• No room for complacency in this regards – the international competition is intense....

• If we maximise the capacity of Dublin we maximise the potential of the entire country. Targeted investment in key infrastructure is necessitated e.g. Water


The Metropolitan RevolutionThe book argues that metro areas — or, cities and suburbs together — are powerful economic engines with considerable political influence, and that local leaders are more likely to take on the nation's big challenges than politicians in Washington.

“The country’s 388 metropolitan areas are home to 84% of its population and generate 91% of national GDP”

" ... Cities and metropolitan areas are really networks of leaders and institutions. They're very powerful on their own, but when they come together and they collaborate to compete, they can do grand things together.“

Video links: http://metrorevolution.org/videos/


http://metrorevolution.org/videos/

http://metrorevolution.org/videos/

Role of government....

• The point of the metropolitan revolution is not that these so-called higher levels of government do not matter. Rather, the point is that they must act in service of their metropolitan engines.

• Every metropolitan leader – and every national leader – must ask how national governments, local governments and other actors should interact to coproduce the economy. Waves of economic change have put cities and metros at the forefront.

• Will national governments ignore these changes, or will they recognise that supporting metropolitan areas is the new imperative?

• This is very relevant to Ireland…..so how does we respond to this to ensure that we maximise Dublin’s potential....(Activating Dublin model?)


Extra Material

• Selection of useful international indicators

Some Recent Coverage and indicators.....

“Emerging Tech: Dublin one of 9 International Startup Hubs to Watch”

“New Silicon Valley on the emerald isle”

“Ireland best country to invest in Western Europe. Dublin third best metro”

“Dublin is the Great Bike Hope among emerging bicycle cities... Dublin is an inspiration and a city to watch”


Dublin ranked overall the fourth most prosperous city in the 2012/13 UN prosperity index

Report: http://www.unhabitat.org/pmss/listItemDetails.aspx?publicationID=3387

News Article: http://www.irishtimes.com/news/dublin-ranked-fourth-most-prosperous-city-in-un-index-1.1313782

http://www.unhabitat.org/pmss/listItemDetails.aspx?publicationID=3387

http://www.unhabitat.org/pmss/listItemDetails.aspx?publicationID=3387

http://www.irishtimes.com/news/dublin-ranked-fourth-most-prosperous-city-in-un-index-1.1313782

http://www.irishtimes.com/news/dublin-ranked-fourth-most-prosperous-city-in-un-index-1.1313782

International examples of cities

• Germany’s top four metropolitan economies – Cologne-Dusseldorf, Hamburg, Frankfurt and Stuttgart – contain just over a quarter of the country’s population but generate more than 30% of national GDP.

• Barcelona, Madrid, Valencia and Seville represent 35% of Spain’s population, but nearly 40% of its GDP.

• The top 10 metro economies in the UK house just over the half its population, but produce nearly two-thirds of the country’s output, with more than one-third coming from Greater London alone.


Quality of Living• Dublin 35th city in the world for quality of living (Mercer, 2012)• Dublin 16th top city in the world for personal safety (Mercer, 2011)• Top 5 global cities are: Vienna, Zurich, Auckland, Munich,

Düsseldorf

Costs of Living• Dublin is now outside of the top global 50 cities for costs of living

(58th) from 42nd in 2010. Now 74th in 2013.• 6 years ago Dublin was 10th

• Top 5 global cities are Luanda (Angola), Tokoyo, N’djamena (Chad), Moscow, Geneva

Quality and Cost of Living


The biggest web summit outside of the US


• Dublin 13th friendliest place in world (Cork 20th and Kilkenny 9th , Conde Nast traveler survey, 2013

“Ireland’s most famous metropolis is also among its kindliest. This “big, bustling city with great museums” is “full of history and likeable people.” “The friendliest natives I have ever encountered,” gushed one visitor, “the gift of Irish gab lives!” Another Dublin enthusiast noted that every local they came across had “a smile in their voice and a joke at the ready.” With “so much to see and do” and, of course, “wonderful pubs,” “inviting” Dublin “should be on everyone’s bucket list.”

http://www.cntraveler.com/daily-traveler/2013/07/world-travel-dublin-auckland-cork-friendly-unfriendly-cities_slideshow_item7_8 Jamie Cudden – Activating Dublin Twitter: @jcudden

http://www.cntraveler.com/daily-traveler/2013/07/world-travel-dublin-auckland-cork-friendly-unfriendly-cities_slideshow_item7_8



Tourism and Cities – Nov 2013

Tourism Intelligence International launches its brand new study entitled, "Cities on the Rise -- Competitive Strategies for City Tourism

City tourism is growing faster and is more resilient than global tourism. It also explains that city tourism drives the development of the destination's tourism sector as a whole and is a vital force for economic growth

http://www.youtube.com/watch?v=pN9IX7titoY

http://www.youtube.com/watch?v=pN9IX7titoY

Making the Case for a Strong Dublin

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