A Summary of the Liveability Ranking and Overview August 2016 A report by The Economist Intelligence Unit A Summary of the Liveability Ranking and Overview Contents The findings of the latest liveability survey 2 Worldwide terrorism continues to shake up stability 2 Ten of the best - the most improved liveability scores over five years 3 Ten of the worst - the biggest declines in liveability scores over five years 3 Civil war in worst performers has been globally destabilising 5 The ten most liveable cities 6 The ten least liveable cities 6 About The Economist Intelligence Unit’s liveability survey 1 7 How the rating works 7 The suggested liveability scale 7 How the rating is calculated 8 © The Economist Intelligence Unit Limited 2016 A Summary of the Liveability Ranking and Overview The findings of the latest liveability survey Worldwide terrorism continues to shake up stability Melbourne in Australia remains the most liveable of the 140 cities surveyed, very closely followed by the Austrian capital, Vienna. In fact, only 0.1 percentage points separate the top two cities, and just 0.2 and 0.3 percentage points separate Canada’s Vancouver and Toronto, respectively, from Melbourne. Another Canadian city, Calgary, shares joint fifth place with Adelaide in Australia. Although the top five cities remain unchanged, the past year has seen increasing instability across the world, causing volatility in the scores of many cities. Sydney, for example, has fallen by four places, to move out of the ten most liveable cities, owing to a heightened perceived threat of terrorism. This has allowed Hamburg in Germany to move up to tenth place, although other German cities, such as Frankfurt and Berlin, have experienced declines in stability. Over the past six months 16 cities of the 140 surveyed have experienced changes in scores. This rises to 35 cities, or 25% of the total number surveyed, when looking at changes over the past year. Of these changes, the majority have been negative (29 in the past 12 months), reflecting deteriorating stability as cities around the world face heightened threats of terrorism or unrest. The continuing weakening of global stability scores has been made uncomfortably apparent by a number of high-profile incidents that have not shown any signs of slowing in recent years. Violent acts of terrorism have been reported in many countries, including Turkey, Australia, Bangladesh, Pakistan, France, Belgium and the US. This has been a year undoubtedly marked by terrorism. While not a new phenomenon, its frequency and spread have increased noticeably and become even more prominent in the past year. Terrorism has also been compounded by unrest and, in more extreme cases, civil war in some countries. Libya, Syria, Iraq and Ukraine remain the subject of high-profile armed conflicts, while a number of other countries, such as Nigeria, continue to battle insurgent groups. Meanwhile even relatively stable countries such as the US have seen mounting civil unrest linked to the Black Lives Matter movement, which has scrutinised the large number of deaths of black people while in police custody. Beyond this, the world has also seen increased diplomatic tensions between countries, weighing on stability. Russia’s own posturing in Ukraine and the Middle East has been well reported, but China has also been diplomatically more aggressive in the South China Sea, and tensions remain between India and Pakistan over the disputed Kashmir region. As a result, it is not surprising that declining stability scores have been felt around the world. However, those cities moving up the ranking are located largely in countries that have enjoyed periods of relative stability after previously reported falls in liveability. Despite continuing to rank in the lower tiers of liveability, Middle Eastern cities, such as Tehran in Iran and Al Khobar in Saudi Arabia, as well as the South-east Asian city of Bangkok in Thailand, have seen scores improve as civil stability has recovered. In total, there are just six cities with improved scores over the past 12 months. 2 © The Economist Intelligence Unit Limited 2016 A Summary of the Liveability Ranking and Overview The impact of declining stability is most apparent when a five-year view of the global average scores is taken. Overall, the global average liveability score has fallen by 0.9% to 74.8% over the past five years, and one-quarter of this decline has come in the past year. Weakening stability has been a key factor in driving this decrease. The average global stability score has fallen by 2.4% over the past five years, from 73.7% in 2012 to 71.3% now. Over five years, 96 of the 140 cities surveyed have seen some change in overall liveability scores. Of these cities, 71 have seen declines in liveability, up from 52 just six months ago. Two cities in particular, Damascus in Syria and Kiev in Ukraine, have seen significant declines, of 26 and 25 percentage points respectively, illustrating that conflict is, unsurprisingly, the key factor in undermining wider liveability. Ten of the best - the most improved liveability scores over five years City Country Rank (out of 140) Overall Rating (100=ideal) Five year movement % Tehran Iran Dubai UAE 126 50.8 +5.0 Harare Zimbabwe 74 74.7 +4.6 133 42.6 +4.4 Abidjan Cote d'Ivoire 128 49.7 +3.8 Kuwait City Kuwait 81 72.1 +2.5 Kathmandu Nepal 124 51 +2.3 Warsaw Poland 65 80.3 +2.1 Bratislava Slovakia 63 81.5 +1.7 Baku Azerbaijan 103 62.3 +1.6 Honolulu US 17 94.1 +1.3 Ten of the worst - the biggest declines in liveability scores over five years 3 City Country Rank (out of 140) Overall Rating (100=ideal) Five year movement % Damascus Syria 140 30.2 -26.1 Kiev Ukraine 131 44.1 -25.1 Detroit US 57 85 -5.7 Moscow Russia 80 72.8 -5.6 Bahrain Bahrain 91 68.8 -4.6 Tripoli Libya 139 35.9 -4.5 St Petersburg Russia 76 74.1 -4.4 Paris France 32 91.1 -3.7 Athens Greece 69 75.3 -3.4 Caracas Venezuela 123 51.3 -3.3 © The Economist Intelligence Unit Limited 2016 A Summary of the Liveability Ranking and Overview Although the most liveable cities in the world remain largely unchanged, there has been movement within the top tier of liveability. Of the 65 cities with scores of 80 or more, 17 have seen a change in score in the past 12 months. As global instability grows, these movements have been overwhelmingly negative, with no city in the top tier registering a score improvement. US cities have recently seen further declines in scores. This partly stems from unrest related to a number of deaths of black people either in police custody or shot on the street despite being unarmed in the past couple of years. Paris is another city that has seen a sharp decline in its ranking, due to a mounting number of terrorist attacks taking place in the city, and in other parts of the country, over the past three years. Nevertheless, with such high scores already in place, the impact of such declines has not been enough to push any city into a lower tier of liveability. Although 17.2 percentage points separate Melbourne in first place from Warsaw in 65th place, all cities in this tier can lay claim to being on an equal footing in terms of presenting few, if any, challenges to residents’ lifestyles. Nonetheless, there does appear to be a correlation between the types of cities that sit right at the very top of the ranking. Those that score best tend to be mid-sized cities in wealthier countries with a relatively low population density. These can foster a range of recreational activities without leading to high crime levels or overburdened infrastructure. Six of the top ten scoring cities are in Australia and Canada, which have, respectively, population densities of 3.1 and 3.9 people per square kilometre. Elsewhere in the top ten, Finland and New Zealand both have densities of approximately 18 people per square kilometre of land area. These densities compare with a global (land) average of 57 and a US average of 35. Austria bucks this trend with a density of 104 people per square kilometre. However, Vienna’s population of over 1.74m (2.6m in the metropolitan area) people is relatively small compared with the megacities of New York, London, Paris and Tokyo. It may be argued that violent crime is on an upward trend in the top tier of cities, but these observations are not always correct. According to the most recently released statistics, after a record low number of murders in 2013, Vancouver saw its murder rate increase in 2014, but 2013 and 2014 were still the years with the lowest national murder rates in Canada since 1966. Although crime rates are perceived as rising in Australia, the state of Victoria, where Melbourne is located, recorded a crime rate of 7,489.5 per 100,000 people in 2013/14. This reflected an increase of 3.7% compared with 2012/13, but despite the increase in the crime rate in three consecutive years, the 2013/14 rate was still 1.6% lower than ten years earlier. In Austria the murder rate was just 0.5 per 100,000 people in 2014. In the same year there were reports that only nine murders had been recorded in Vienna, a city of 1.74m people, with a murder rate matching the national average. Overall, crime rates have remained steady. These figures compare with a global average of 6.2 murders per 100,000 people (2013) and a US average of 4.5 per 100,000 (2014). Global business centres tend to be victims of their own success. The “big city buzz” that they enjoy can overstretch infrastructure and cause higher crime rates. New York, London, Paris and Tokyo are all prestigious hubs with a wealth of recreational activity, but all suffer from higher levels of crime, congestion and public transport problems than are deemed comfortable. The question is how much wages, the cost of living and personal taste for a location can offset liveability factors. Although global 4 © The Economist Intelligence Unit Limited 2016 A Summary of the Liveability Ranking and Overview centres fare less well in the ranking than mid-sized cities, for example, they still sit within the highest tier of liveability and should therefore be considered broadly comparable, especially when contrasted with the worst-scoring locations. Civil war in worst performers has been globally destabilising Of the poorer-scoring cities, 13 continue to occupy the very bottom tier of liveability, where ratings fall below 50% and most aspects of living are severely restricted. Continued threat from groups like Boko Haram acts as a constraint to improving stability in Lagos, Nigeria’s largest city. The liveability scores for Ukraine’s capital, Kiev, are still in recovery. Escalations in hostilities in Libya have prompted a sharp decline in liveability in Tripoli as the threat to stability from Islamic State (IS, an extreme global jihadi group) continues to spread across the Middle East and North Africa. Damascus has seen a stabilisation in its dramatic decline in liveability but remains ranked at the bottom of the 140 cities surveyed. The relatively small number of cities in the bottom tier of liveability partly reflects the intended scope of the ranking—the survey is designed to address a range of cities or business centres that people might want to live in or visit. For example, the survey does not include locations such as Kabul in Afghanistan and Baghdad in Iraq. Although few could currently argue that Damascus and Tripoli are likely to attract visitors, their inclusion in the survey reflects cities that were deemed relatively stable just a few years ago. With the exception of crisis-hit cities, the low number of cities in the bottom tier also reflects a degree of convergence, where levels of liveability are generally expected to improve in developing economies over time. This long-term trend has been upset by the heightened, widespread reach of terrorism over the past five years. Conflict is responsible for many of the lowest scores. This is not only because stability indicators have the highest single scores but also because factors defining stability spread to have an adverse effect on other categories. For example, conflict will not just cause disruption in its own right, it will also damage infrastructure, overburden hospitals and undermine the availability of goods, services and recreational activities. With the exception of Kiev, the Middle East, Africa and Asia account for all 13 cities, where violence, whether through crime, civil insurgency, terrorism or war, has played a strong role. 5 © The Economist Intelligence Unit Limited 2016 A Summary of the Liveability Ranking and Overview The ten most liveable cities City Melbourne Country Rank (out of 140) Overall Rating (100=ideal) Stability Healthcare Culture & Environment Education Infrastructure Australia 1 97.5 95 100 95.1 100 100 Vienna Austria 2 97.4 95 100 94.4 100 100 Vancouver Canada 3 97.3 95 100 100 100 92.9 Toronto Canada 4 97.2 100 100 97.2 100 89.3 Calgary Canada 5 96.6 100 100 89.1 100 96.4 Adelaide Australia 5 96.6 95 100 94.2 100 96.4 Perth Australia 7 95.9 95 100 88.7 100 100 Auckland New Zealand 8 95.7 95 95.8 97 100 92.9 Helsinki Finland 9 95.6 100 100 88.7 91.7 96.4 Hamburg Germany 10 95 90 100 93.5 91.7 100 The ten least liveable cities 6 City Country Rank (out of 140) Overall Rating (100=ideal) Stability Healthcare Culture & Environment Education Infrastructure Kiev Ukraine 131 44.1 20 54.2 48.6 75 42.9 Douala Cameroon 132 44 60 25 48.4 33.3 42.9 Harare Zimbabwe 133 42.6 40 20.8 58.6 66.7 35.7 Karachi Pakistan 134 40.9 20 45.8 38.7 66.7 51.8 Algiers Algeria 134 40.9 40 45.8 42.6 50 30.4 Port Moresby PNG 136 38.9 30 37.5 44.2 50 39.3 Dhaka Bangladesh 137 38.7 50 29.2 43.3 41.7 26.8 Lagos Nigeria 138 36 10 37.5 53.5 33.3 46.4 Tripoli Libya 139 35.9 20 41.7 37.5 50 41.1 Damascus Syria 140 30.2 15 29.2 43.3 33.3 32.1 © The Economist Intelligence Unit Limited 2016 A Summary of the Liveability Ranking and Overview About The Economist Intelligence Unit’s liveability survey How the rating works The concept of liveability is simple: it assesses which locations around the world provide the best or the worst living conditions. Assessing liveability has a broad range of uses, from benchmarking perceptions of development levels to assigning a hardship allowance as part of expatriate relocation packages. 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 suggested liveability scale Companies pay a premium (usually a percentage of a salary) to employees who move to cities where living conditions are particularly difficult and there is excessive physical hardship or a notably unhealthy environment. The Economist Intelligence Unit has given a suggested allowance to correspond with the rating. However, the actual level of the allowance is often a matter of company policy. It is not uncommon, for example, for companies to pay higher allowances—perhaps up to double The Economist Intelligence Unit’s suggested level. Rating Description 80–100 There are few, if any, challenges to living standards 70–80 7 Suggested allowance (%) 0 Day–to–day living is fine, in general, but some aspects of life may entail problems 5 60–70 Negative factors have an impact on day-to-day living 10 50–60 Liveability is substantially constrained 15 50 or less Most aspects of living are severely restricted 20 © The Economist Intelligence Unit Limited 2016 A Summary of the Liveability Ranking and Overview How the rating is calculated 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. Category 1: Stability (weight: 25% of total) Indicator Source Prevalence of petty crime EIU rating Prevalence of violent crime EIU rating Threat of terror EIU rating Threat of military conflict EIU rating Threat of civil unrest/conflict EIU rating Category 2: Healthcare (weight: 20% of total) Indicator Source Availability of private healthcare EIU rating Quality of private healthcare EIU rating Availability of public healthcare EIU rating Quality of public healthcare EIU rating Availability of over-the-counter drugs EIU rating General healthcare indicators Adapted from World Bank Category 3: Culture & Environment (weight: 25% of total) 8 Indicator Source Humidity/temperature rating Adapted from average weather conditions Discomfort of climate to travellers EIU rating Level of corruption Adapted from Transparency International Social or religious restrictions EIU rating Level of censorship EIU rating Sporting availability EIU field rating of 3 sport indicators Cultural availability EIU field rating of 4 cultural indicators Food and drink EIU field rating of 4 cultural indicators Consumer goods and services EIU rating of product availability © The Economist Intelligence Unit Limited 2016 A Summary of the Liveability Ranking and Overview Category 4: Education (weight: 10% of total) Indicator Source Availability of private education EIU rating Quality of private education EIU rating Public education indicators Adapted from World Bank Category 5: Infrastructure (weight: 20% of total) 9 Indicator Source Quality of road network EIU rating Quality of public transport EIU rating Quality of international links EIU rating Availability of good quality housing EIU rating Quality of energy provision EIU rating Quality of water provision EIU rating Quality of telecommunications EIU rating © The Economist Intelligence Unit Limited 2016 Our subscription and consulting services Subscription services The world’s leading organisations rely on our website and databases to keep them constantly informed about what is happening around the world now and what it will look like tomorrow. 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