The 21st Global Financial Centres Index puts London ahead of New York, despite Brexit.
The Global Financial Centres Index was first published in 2007 “to provide evaluations of competitiveness and rankings for the major financial centres around the world”, and is now produced by two agencies; the China Development Institute in Shenzen and Z/Yen Partners in London.
The report is released twice a year, in March and September, and tends to generate headlines, as everyone wants to know who’s best, obvs.
This year, there are 88 financial centres in the list, plus 18 “associate centres” – Guangzhou has been promoted to the main list, whilst Karachi, Chengdu and Hangzhou have been given associate centre status.
The index comprises 101 “instrumental factors”, provided by the likes of the World bank and the Economist Intelligence Unit, United Nations and OECD. Additionally, the GFCI financial questionnaire is circulated amongst financial leaders and has received 3,008 responses to date.
The top 5 cities were unchanged; London, New York, Singapore, Hong Kong and Tokyo. The next five are San Francisco, Chicago, Sydney, Boston and Toronto, with Zurich, Washington and Shanghai just missing out on the top ten.
The big news was that Brexit nearly cost London the no. 1 spot – London dropped 13 points (t0 782), but perhaps strangely, New York dropped by even more points, 14, to 780, with Singapore now hot on the Big Apple’s heels. Blame Trump?
The report also notes volatility amongst Western European financial centres with 16 of the centres in the region declining, and 12 rising. Besides New York, America performed well, Latin America struggled, the Middle East rose, and offshore centres experienced “mixed fortunes”.
The report blames political and social upheaval for the volatility, but notes that after the initial shock of Brexit, London has performed fairly well.
Otherwise, it is hard to pick a “surprise city” from the list – if somebody asked you to pick out your top 80 financial centres, we’d wager you’d pick most of these; Talinn (42nd), Casablanca (30th, one place behind Paris) and the Cayman Islands jumped out at us, and we’d perhaps expect Moscow (85th) to come in higher.
Such are the vagaries of reports like this, however readers – the top 10 may grab the headlines, but delve further into the report and there is a mine of information, from deep-dives into specific regions, to financier’s views on how their “home centres” stack up against global competitors, to up and coming centres – look out for Busan, Istanbul, Abu Dhabi and Dublin, folks.