Seoul ranked second in the world after Munich, Germany in the institutional sector of "future potential" among global cities. It jumped three spots from fifth last year. While its future potential was rated world-class, its current standing slipped slightly. Analysts say the AI era has laid bare Seoul's clear strengths and fatal weaknesses at the same time.
According to the 2025 Global Cities Report released by Kearney, a global consulting corporations, on the 22nd (local time), Seoul ranked second in this year's Global Cities Outlook (GCO), which is calculated based on a city's future potential, following Munich, Germany (No. 1).
Kearney evaluates 158 major cities worldwide each year using two key indicators and releases the rankings. The Global Cities Outlook ranks scores across four areas: personal well-being index, economy, innovation, and governance. The Global Cities Index (GCI) measures current influence and competitiveness. It uses five areas as criteria: business activity, human capital, information exchange, cultural experience, and political engagement.
Seoul showed strength in the GCO, which assesses future potential. In the GCO rankings, Seoul outpaced Singapore (No. 3), San Francisco in the United States (No. 4), and Copenhagen in Denmark (No. 5).
Five years ago, in 2020, Seoul fell to 42nd in the GCO rankings. At the time, Seoul was assessed as having an "uncertain future." However, it surged to 36th in 2022 and to fifth last year, before rocketing to second this year. In five years, it climbed from a city with an uncertain future to one of the world's most promising cities.
In this year's report, Kearney said that "Seoul rose to second place on the strength of 'sustained innovation and governance performance.'" Governance is evaluated by comprehensively assessing how transparent and efficient a city's operating system is and its stability.
The report said, "Seoul is rapidly taking shape as a global tech powerhouse," noting that "a vibrant Start - Up community, world-class universities, and strategic government investment underpin this." The analysis is that innovation and administrative efficiency have explosively lifted the future value Seoul holds.
By contrast, Seoul ranked 12th in the GCI, which reflects current urban influence. That is down one notch from 11th last year. After steadily climbing from 17th in 2020, its upward momentum stalled this year.
Experts pointed to a slight dip in the personal well-being score as the reason Seoul lagged in the GCI compared with the GCO. Kearney defines personal well-being as encompassing safety, health care, social equity, and environmental performance. It is an indicator directly tied to the "quality of life" that citizens actually feel. According to Kearney, Seoul is favorable for corporations (innovation) and administratively efficient (governance), but a tough city for residents (decline in well-being).
From first to fifth in the GCI were New York in the United States, London in the United Kingdom, Paris in France, Tokyo in Japan, and Singapore. The report said that "these five legacy hubs held their positions with no changes from last year," adding that "in a world of greater volatility, this shows how strong the existing leaders' resilience is." They were followed by Chinese cities such as Beijing (No. 6), Hong Kong (No. 7), and Shanghai (No. 8).
Busan (No. 82) and Incheon (No. 84) also newly entered the GCI rankings this year. In the GCO rankings, Busan and Incheon newly entered at 49th and 55th, respectively, demonstrating growth potential.
Shigeru Sekinada, chair for the Asia-Pacific region at Kearney, said, "Asian cities like Seoul are maintaining firm leadership in a changing global environment by focusing on technological innovation and regulatory reform (governance) and strengthening climate resilience (environment)."