Dublin has again headed a survey of 78 European cities with the greatest economic growth potential over the short to medium term and the strongest demand for real estate.
The European Regional Economic Growth Index (E-REGI), compiled by Jones Lang LaSalle, shows Dublin maintained its top position in the index in 2000 for the second successive year. Overall, it found the results underlined the increasing importance of the "new economy" in shaping economic growth prospects and driving property demand in cities.
"Dublin has once again recorded the highest E-REGI score, with strong growth prospects and an attractive business environment stimulating high levels of foreign direct investment (FDI)," the report says. "IT software, new media and international financial groups are particularly active, and many of these companies have significant expansion plans."
Paris takes second place in the index as a result of what the report describes as an increasingly dynamic French economy. London is ranked sixth and with Paris and Frankfurt (ranked 11th) is seen as benefiting from powerful agglomeration forces as high value commercial functions are further concentrated into the large business centres.
"London is developing as Europe's most important location for new media, with the office market benefiting from strong demand from `dot com' companies. Frankfurt continues to see growth in financial services, which in turn is stimulating growth in other support activities," it says.
Conversely, regional centres in the UK have slipped on the index with Birmingham dropping from 26th to 50th position, Manchester from 35th to 48th, and Newcastle from 50th to 74th. Belfast also saw a slight drop from 65th to 68th position. The report says the sharp falls in British regional centres have much to do with the improved economic growth prospects of Continental Europe vis-a-vis the UK, but it also reflected structural factors with a gap emerging between London and much of the rest of the UK in "new economy" growth sectors.
It identifies the Nordic/Baltic Sea region as leading Europe's Internet revolution. It has become one of Europe's hottest regions for "new economy" sectors, scoring among the highest on almost every measure of technological progress. As a result, Helsinki (3rd), Stockholm (4th), and Copenhagen (9th) are all in the top 10 positions.
Other areas of Europe benefiting from the "new economy" include Munich, Germany's leading IT and biotechnology centre, Madrid, Bilbao, Milan and Amsterdam. Cities on the lower levels of the index include a combination of southern European ports, like Palermo and Oporto, and traditional "old economy" industrial cities in northern Europe like Sheffield and Liege, the report says.
