In the face of megatrends, the capacity of leaders and territories to innovate, capitalise on new potential and manage policy trade-offs varies both within and across advanced and emerging countries. Lower trade costs for goods and ideas created benefits for firms and consumers, but not all cities will reap the gains from globalisation. Although the world is growing more urban everyday, many cities are struggling to meet the needs of a changing population profile. The ongoing production and technological revolution has the potential to boost smarter urban solutions, but it also puts some jobs at risk of automation, creates a digital divide, raises privacy concerns for citizens and jeopardises urban security. Climate change exerts pressure on the demand for food, water and energy, but also opens avenues for innovative models to foster resource efficiency and transition to a low-carbon economy.