Leading article: A capital accolade that does huge credit to the whole of Britain

The Independent today announces the first winner of its annual world city of the year competition. It will be a disappointment to several natural contenders. The Big Apple has fallen. The City of Light has been dimmed. The sun has gone down on Tokyo. The city that rises above all others is our very own capital: London.

London's claim to be considered the world's pre-eminent financial centre is straightforward. The capital has made the most of its historic position as a commercial hub and its advantageous geographical location for global finance. More money flows through New York, but Russian, Chinese and Indian cash is more likely to be looking for a home in London now. Companies are increasingly raising money in the capital too, put off by strict corporate governance rules imposed in the US in the wake of the Enron scandal.

Of course, anyone who lives in London will know that, despite its financial success, the city's streets are not paved with gold. There are many things wrong with the capital, from a grossly inflated housing market to urban deprivation and an overstretched transport system. It is a hugely expensive place to live (although not for the global super-rich who are increasingly basing themselves in its most desirable neighbourhoods). But most Londoners also know that the city offers a fantastic quality of life in other significant ways.

The capital is a culinary paradise. There are more Michelin-starred restaurants than ever before. And you can eat your way around the world in London for reasonable prices, from Bangladeshi Brick Lane, Middle Eastern Edgware Road to Soho's Chinatown. Other world cities indeed other cities in the UK, such as Manchester and Liverpool have their ethnic quarters too, but few can match the sheer number of London's.

Like so many British cities, the capital is culturally blessed too. Tourists have always flocked to the neo-Gothic grandeur of the Houses of Parliament and the Renaissance elegance of the Banqueting House. But they also find impressive modern architecture, in buildings such as Norman Foster's "gherkin", nestling alongside the architectural legacy of previous ages.

The theatrical delights of the West End are well known. But London has also become a huge centre for contemporary arts in recent years, thanks to Tate Modern and the Frieze Art Fair. The Government's lifting of museum entry charges has given the capital's arts scene a shot in the arm. Local politics has been helpful too. Ken Livingstone's pedestrianisation and congestion charging programme have both facilitated London's cultural growth by freeing up the capital's public spaces.

Another driver of London's success has been its openness, not just to foreign money, but talent too. Many of those in positions of power and influence in the capital are not necessarily British. Public officials, company directors, even football managers are imported from abroad. This does not guarantee success, of course, but this willingness to hire without prejudice has served the capital well. Happily, this openness has extended throughout the city's economy. One in three Londoners was born abroad. Some 300 languages are spoken in London. It is a city of stunning diversity, a truly cosmopolitan capital.

Some have argued that London is no longer truly part of Britain, that it has become a cultural and financial island, adrift from the rest of the UK. On the contrary, we would argue that with its openness, its enterprise, its rich culture, and it grand architectural heritage, London, on a good day, represents all that is best about Britain. Long may its reign as the world's capital city continue.