Canadian cities have great potential and offer excellent conditions for foreign investments, according to the annual "Cities of the Future" list published by fDi Magazine. Even though the current global economic climate is full of uncertainties, with a 16 per cent decline in foreign direct investment in 2012, Canadian cities maintained their decent reputation and ranked among the most promising destinations around the world for inward investment. Three major Canadian cities made it to the list of the top 10 overall American cities of the future, with Toronto at third place, followed by Montreal and Vancouver in fourth and fifth place. The title went to New York City, and São Paolo grabbed second place. Furthermore, Calgary ranked tenth in the top 10 overall North American cities of the future list. In the large cities category, Ottawa ranked top of the FDI (foreign direct investment) Strategy category, followed by Edmonton in second place.
Canada did well also in the mid-sized and micro city categories with Mississauga ranking second in economic potential in the mid-sized category and Waterloo being sixth in the top 10 micro American cities of the future list. Waterloo experienced a great increase in FDI, topping the human resources category of micro cities.
Canadian cities had great results in the attraction of knowledge-intensive FDI, and they dominated the category for business friendliness across all city sizes. The report explained the reasons for this success:
A sound financial system, relatively low corporation tax rates and an open and affluent economy.
Toronto finished second in business-friendly category, followed by Montreal in the third spot. Toronto’s conditions for investment were described as combining stable, transparent financial and regulatory systems with a society that enjoys some of the most advanced freedoms in the world. Montreal benefited from retaining and developing relationships with existing investments. Moreover, Canadian cities ranked at top positions for business friendliness in other city categories. Vancouver was first among large cities, Mississauga took first place in the mid-sized category, Victoria won among small cities, and Waterloo ranked first in micro cities, just ahead of Delta.
Montreal’s first place in the best major American city for FDI strategy ranking was a great success, followed by Toronto, which came in second. Montreal beat all 126 other competitors across North and South America that submitted data concerning their FDI strategies. The metropolitan Montreal region’s economic development strategy, according to Montreal International, focused mostly on high-tech clusters, and in particular aerospace, life sciences, and health technologies as well as information and communications technology. Jacques St-Laurent, president and CEO of Montreal International, suggested,
Greater Montreal’s outstanding performance shows just how attractive our region is thanks to the vitality of its high-tech sectors, its excellent universities and research centres, and its highly skilled, talented and bilingual workforce. We are extremely pleased and proud that the quality of our FDI strategy was recognized by such a prestigious publication.
Toronto was recognized for being a major player in the North American market, particularly for being “the financial services capital of Canada, and the fastest growing financial centre in North America."
In addition, Ottawa ranked first in the list of large cities for the FDI strategy category because it's “innovating, collaborating and moving at the speed of industry to achieve sustainable economic growth." Edmonton placed second in the same category, and Hamilton was the number one among mid-sized cities.
Canada also dominated in the mid-sized American cities of the future category, with Mississauga, London, Hamilton, and Quebec City occupying the first four spots and Surrey and Brampton taking seventh and eighth place, respectively. The top positions in the categories of small and micro American cities of the future also went to Canada. Victoria won the small category, followed by Richmond in third place, Richmond Hill in fifth place, St. John’s in ninth place, and Sherbrooke in 10th place. Fredericton won the micro category, with three three Canadian cities making it into top 10 (Pickering, Kamloops, and Waterloo).
The American Cities of the Future lists are part of fDi Magazine’s “Locations of the Future" series, which determines cities with the best conditions for future inward investment around the world. Data for the American Cities of the Future ranking were collected for 422 cities under five categories, including economic potential, human resources, cost effectiveness, infrastructure, and business friendliness. There was an extra category called "FDI Strategy," in which 127 cities submitted information concerning their current strategy for FDI promotion. Cities could score a maximum of 10 points under each data-point, which was weighted by its significance to the FDI decision making process. Moreover, cities were divided into different categories according to the population of the immediate city area and of the metropolitan area.