(FORTUNE Magazine) – YOU COULD SPEND a lot of time looking up in Hong Kong. This island city is spectacularly vertical, and still sending up shoots like so much concrete bamboo. But don't pause too long to contemplate the architecture lest you cause a major pileup of people. People who are in a hurry. People who are in a hurry to do business, too busy to worry that a new landlord will be taking over in 1997, when mother China will reassert her sovereignty over this runaway child of capitalism. And by all indications, the mainlanders view reunification with Hong Kong as an extension of dynasty. Like much of the rest of the world, China realizes that Hong Kong is at the vortex of an economic boom that will transform not only China but all of Asia and, indeed, the entire global economy. And that's why Hong Kong tops FORTUNE's list of Best Cities for Business. Hong Kong is the first foreign city to be so honored, and for a good reason: this is the first year that FORTUNE has expanded its best-cities charter to include the whole world. Going global editorially is, of course, a natural. The FORTUNE 500 | industrial companies and their service company counterparts derive ever- increasing amounts of sales and earnings from overseas operations. And as they shift their focus abroad, they face new competitors -- of all shapes and persuasions -- in the world's commercial capitals, cities ranging from old standbys, like London and New York, to such relative newcomers as Singapore and Atlanta. In fact, nearly every growth-oriented company in business today is pulled by global forces. Mix the North American Free Trade Agreement with the beckoning economics and pent-up markets in the Pacific Rim, South America, and Eastern Europe, and the need to view business as a global enterprise is undeniable. So FORTUNE cast its net across the planet and commissioned unprecedented research to help us with our choices. (For more on how the list was compiled, see box.) Additionally, FORTUNE staff correspondents have contributed on-site reporting from many locales, including San Francisco, Frankfurt, London, Singapore, Paris, Taipei, Bombay, Miami, and Hong Kong. In second place, New York heads a roster of five U.S. cities in the top ten, a surprisingly strong result if you buy the line that the U.S. is high cost and underproductive. It is neither, of course, and the weak dollar only adds to this country's attractiveness for foreign investment. "For all the talk of the U.S. losing the trade wars -- to Japan, to Europe, to Southeast Asia -- it is refreshing just how well the U.S. did in the survey," says Ken Kuhl, a consultant with Moran Stahl & Boyer, a location consulting firm that conducted research in 32 countries for this article. "More importantly," Kuhl adds, "the executives surveyed see great potential for growth in the American market." Nearly half said the U.S. is second only to the Asia/Pacific region in that respect.

HONG KONG This city is the crowded entryway to that highest-growth region. Anyone who has been jostled in the daily bustle of the business district, Central, knows that Hong Kong has a pace that can make walking even in New York feel like mere perambulation. A brisk stroll through Central can also be remunerating. "I can walk a few blocks here and raise a billion dollars," says Joseph Ferrigno III, an American who previously lived in London and New York and has been in Hong Kong for a decade, first working for Lehman Brothers and currently as managing director of Bechtel Enterprises, Asia-Pacific. "There is a can-do attitude that is stronger here than in the West."

Hong Kong offers unique access to the planet's fastest-growing economy and biggest potential market, China. The city is an ideal base from which to manage businesses spread across Asia; it has arguably the most pro-business government in the region, a personal income tax rate of 15%, and fabulous office views. But Hong Kong's greatest advantage may not be its tax rate nor the happy accident of its geography. It is the city for the next century because its residents -- both ethnic Chinese and Westerners -- are well equipped to seize the many opportunities unfolding before them. Obviously, they understand China and, indeed, much of Asia, better than their counterparts in New York or London. Better still, they may possess more of the entrepreneurial energy and speed that torrid economies demand than managers and dealmakers in the West. Even this British Crown Colony's scheduled reversion to mainland China in 1997 doesn't seem to provoke anxiety, despite some sticky negotiations. China, which needs Hong Kong, has guaranteed that Hong Kong citizens will retain all the rights they now enjoy for a minimum of 50 more years. The two entities, in fact, have never been more interdependent. And the crush of business is so dizzying that it can overwhelm politics. Consider Sheldon Kasowitz, a director with Jardine Fleming, the Hong Kong securities firm, who arrives breathless and late for lunch. It's been that kind of week. Earlier he'd attended a road show presented by a Chinese power company about to proffer an equity offering. Then he'd turned to Pakistan's Hub River power project, which was in the process of listing an unusual $325 million equity offering. "That's a microcosm of what's going on," says Kasowitz as he rushes back to his 46th-floor office to get ready for a trip to Karachi. GEC Alsthom, an Anglo-French manufacturer of rail and power equipment, chose Hong Kong as its regional headquarters to manage far-flung outposts in countries like China, Australia, and India. Michel Reveillon, who moved to Hong Kong in August after managing the Asia-Pacific region out of Paris, says Hong Kong's location gave it the nod over Singapore. What about Hong Kong's high costs? GEC Alsthom, Reveillon says, elected to use fewer people and hire more locals. The current head count is 30, and Reveillon thinks it will rise to about 50. The company has offices all across the Asia/Pacific region, making it easier to run a lean regional headquarters. * GEC Alsthom wisely chose to set up in a brand-new office tower across the bay in Kowloon, eschewing the astronomical rents of Central, where financial firms are tearing up and reconfiguring entire floors of real estate.

Having increased its staff in Hong Kong from 80 people to 300 in the past 18 months, Salomon Brothers has rented additional floors to keep pace. Still, step off the elevators into their 19th-floor offices in Exchange Square and you'll see yet-to-be-unpacked computers spilling into the elevator bank area. The main reason for all this activity: the flood of new issues and the rapid growth of investors in Asia. In telecommunications alone, government and private companies in the region will raise $7 billion by the end of 1995, Salomon estimates. Goldman Sachs has doubled its staff to 400 here in the past year or so. The hordes of obscenely paid Americans have pushed up rents in the already expensive Peak area and even spawned a crop of expensive coffee bars.

SINGAPORE The No. 6 city on our list hopes to cash in as a discount Hong Kong. With its lower rents, well-trained work force, and better quality of life, this blushing, rather too Victorian bridesmaid has enticed companies like Whirlpool and General Motors to locate regional HQs here rather than in Hong Kong. In Singapore the phrase "have a nice day" might be construed as government policy. Yet Singaporeans enjoy one of the highest standards of living in Asia. The city is so thoroughly modern and studded with towering high-rises that first-time visitors are sometimes disappointed. The place looks more like Houston than the teeming Asian capital they expected. But if it's a less-than- exotic city to visit, Western business people say it's a great one in which to live. Nearly astride the equator, Singapore is hot year-round, but there's usually a breeze blowing through the nearby Straits of Malacca and the flora is outstanding. Howard Banwell, a London-born manager for Citibank, has been in Singapore for two years, after spending nearly 20 years in other parts of Asia, particularly Hong Kong and Malaysia. "No place is perfect," he says, "but Singapore comes close." He cites a litany you hear again and again: "Infrastructure is first class. Communication is good and getting better. It's a clean, safe, hassle-free environment, and relatively crime-free." Indeed, Singapore's authoritarian views on law and order were grimly demonstrated by the hanging of a Dutch national on drug charges and the caning of an American for vandalism. The city-state is just as serious about business. "Our job in government is to promote other people's prosperity," says Tan Chin Nam, chief executive of Singapore's Tourist Promotion Board and formerly managing director of the Economic Development Board. "The whole administration of Singapore is pro business." Nobody disagrees.

LONDON Order is a quality fully appreciated in this city, which placed third: The old maxim said that if you stopped to light a cigarette on the street, a queue would form behind you. The world's richest and most influential city in the 1700s and 1800s, London has seen its political power decline ever since, but it remains the unchallenged financial and communications heart of Europe. The weather notwithstanding, it also may be about the most pleasant place to call home. Bob Solberg, deputy chairman of Texaco's U.K. subsidiary, has lived in 12 U.S. cities in the past 22 years and always chose to reside in the suburbs. In London he lives smack in the heart of the city, close to Harrods, with his wife and two teenage daughters. Says he: "We feel more comfortable here than in most U.S. cities. The kids can travel on their own on the tube ((subway)) in complete safety." As for the working environment, Texaco recently leased a building in Canary Wharf, the development in London's docklands that bellied up in 1992 and nearly took down Canada's billionaire Reichmann family. Says Solberg: "It's the most modern building in the world. The communications are the best you can imagine." The presence of Texaco may help restart Canary Wharf, which is only 50% occupied. As for people, Mike Cowan, chief administration officer for Merrill Lynch in London, says that recruiting the best-qualified local staff is also easier in London than elsewhere: "Germans want to work for the big German banks, and the same for the Swiss. The British university graduate thinks more globally."

FRANKFURT Although never a center of power, this city, which placed ninth, has a long commercial heritage. It has hosted trade fairs for 750 years and is celebrating its 1,200th anniversary, enjoying a great location. Germany's famed autobahn network fans out from here, and Europe's most convenient airport with the continent's largest route network is located only 15 minutes from downtown. Some 105 scheduled airlines serve Frankfurt, linking the city with a total of 240 destinations in 100 countries, including nonstop routes to < such Russian outposts as Novosibirsk and Sverdlovsk. Frankfurt is also the continent's undisputed banking and service center. Already home to Germany's biggest banks, it was recently designated the site of the European Monetary Institute, the forerunner to a planned European Central Bank. All these advantages are packed into a manageable area. Says mayor Andreas von Schoeler: "We don't want to be a metropolis of ten million like London or Paris ((Frankfurt has a population of 654,000)). But we are an easier place to live, an international and interesting place." Frankfurt and its surrounding region of Hesse has the highest per capita gross domestic product in Germany, which itself is Europe's richest state. More than half Frankfurt's output comes from high-growth "intelligent" services such as advertising and publishing. After German unification, some Frankfurters feared that they would lose their lead to Berlin, which was set to become the country's political capital. That hasn't happened. Says mayor von Schoeler: "Let Berlin have the politics. We will remain Germany's preeminent international business city." Given this sentiment, it's little wonder cynics call the city dull. "I call it Bankfurt," says Eila Mellin of the Finnish publisher Otava. "This is a business city, full of money but nothing else." Authorities have tried hard to add cultural spice. There are now 45 museums, including the masterly Museum of Decorative Arts designed by Richard Meier, along the banks of the Main River.

ATLANTA Like Frankfurt, Atlanta, No. 4, is in the vanguard of a new breed of globally focused cities that are taking full advantage of geography, trade policy, and their own particular strengths to make themselves vital links to both the developed and developing markets.

The city has lured hundreds of businesses from around the world by providing a compelling combination of attributes, including transportation, low costs, and good quality of life. This former railroad terminus is making its bid for global glory, having snagged the 1996 Summer Olympics. "We think the Olympics can be a transcending event. We consider it to be an international seal of approval that we are doing something right and different that merits international attention," says Cecil Phillips, managing director of Phillips International, a merchant banking limited partnership that includes three private European banks. A trade organization called Operation Legacy was created specifically to convert interest in the games into expansion to the area by international firms. Nearly 250 foreign-owned service firms are located here, according to Peat Marwick.

MIAMI The goal of No. 10 is to be to South America what Hong Kong is to Asia. Says John Anderson, CEO of the Beacon Council, which promotes Miami internationally: "The elements here are ones you can't find anywhere else -- the combination of latitude, longitude, climate, and cultural diversity. This isn't the old economy of the manufacturing age but a more dynamic service-based economy driven by immigrants." Miami boasts scads of immigrant and foreign-owned startups, each employing only a handful of people but with the potential for much greater things. Tourism is the core of the economy, but banking -- both legal and illegal -- is also a focal point: More than 60 international banks operate here. Many Latin American companies conduct business with one another using banks in Miami as a catalyst. "Miami is the only place where you can do business in the Latin way under the influence of American law," notes R.W. Sturm, AT&T's regional vice president for the Caribbean and Latin America. This Sunbelt city is working to strengthen ties with other parts of the world too. "Ten or 12 years ago, if Latin America sneezed, Miami caught a cold," says Carlos Palomares, a Cuban immigrant who has worked for Citibank all over the world and is now CEO of its Florida operations. Swedtel, Barclays Bank, and Rimoldi Necchi, an Italian industrial sewing machine manufacturer, have all set up regional offices here. Acer, the Taiwanese computer maker that ships the most PCs to Latin America, operates from Miami. Sharp will open a Latin American sales office in 1995. Although its tropical setting makes Miami seem like an urban paradise, the city has urban problems that match many older Northern cities, as grievously highlighted by the recent murders of foreign tourists.

NEW YORK In surprising contrast to Miami, the Big Apple seemed safer, judging by the record number of tourists who made it in and out this past summer. Their challenge was to find a choice theater ticket or a table at the priciest restaurants. Conspicuous consumption is back in town, and that's a good sign. Another positive indicator: Large blocks of office space have become scarce, and money is flowing in from Europe. Says Arthur Mirante II, CEO of Cushman & Wakefield, the real estate firm owned by the Rockefeller Group: "As real estate becomes a preferred investment choice again -- and it is -- this city is on everybody's list." A new mayor, Rudolph Giuliani, is making the city's minor annoyances, anything from panhandling to illegal street venders, a focal point in law enforcement policy. Times Square, once a modern-day Gomorrah, is literally being swept clean by workers hired by public-private partnerships. A leading indicator: the Walt Disney Co., that bastion of wholesome entertainment, has seen fit to produce the musical Beauty and the Beast on the Great White Way and is exploring the prospect of renovating a rundown theatre and other Times Square properties in partnership with the city. Although businesses find the cultural side attractive, they are justly concerned about high taxes, particularly the occupancy tax the city imposes for the privilege of being on the tax rolls. "Every time we do a financial analysis, it sticks out like a sore thumb," says Mirante. To make the tax situation a little more bearable, the city has cut deals with a number of large companies, particularly financial houses such as Morgan Stanley, to keep them anchored here. In the past nine months, according to John Dyson, deputy mayor for finance and economic development, the city has kept 30,000 jobs from straying, thus maintaining the city's pool of high-octane, tax-paying talent. (See the following pages for more on the top ten cities and the 50 runners- up.)

IT'S QUITE LIKELY that FORTUNE's Best Cities list will change quickly in the next few years. In the global environment, capital, both monetary and intellectual, is flowing at light speed toward its best return. American cities will compete less and less with each other and more and more with places they never dreamed of: Beijing or Bombay. Expect challenges from places such as Mexico City, Prague, Warsaw, Vancouver, and Santiago. What will these cities bring? Perhaps a better infrastructure, more qualified workers, lower costs, and high value for money. Somehow each whispers, as do this year's top ten, that to go elsewhere would be a mistake. Get ready. The competitors may change; the competition will not.

BOX: THE TOP TEN

1. Hong Kong 2. New York 3. London 4. Atlanta 5. Chicago 6. Singapore 7. Toronto 8. San Francisco 9. Frankfurt 10. Miami