The rising importance of Asian financial centres
The latest Global Financial Centres Index (“GFCI”) was issued earlier this month by the China Development Institute in conjunction with Z/Yen Group. The GFCI is updated in March and in September each year and receives considerable attention from the global financial community.
The latest index analyzed 114 financial centres of which 104 are now in the main index using quantitative measures provided by third parties including the World Bank, the Economist Intelligence Unit, the OECD and the United Nations. The index provides the ranking of global financial centres and the score based on several parameters, such as the business environment, the human capital, the level of the infrastructure, the financial sector development and the reputation.
The Asian financial centres performed well, with six centers among the TOP 10 in the index being located in Asia.
Hong Kong confirms its third position after New York and London, followed by Singapore.
Shanghai, the first financial centre in China Mainland, is just 12 points behind world number 2 London (773) which dropped 14 points in the last six months, with a no-deal Brexit a near inevitability it seems likely that London will fall further down the rankings and soon be surpassed by Shanghai. Other Chinese cities are emerging as global centres: besides the TIER-1 cities as Beijing (7th), Shenzhen (9th), Guangzhou (23rd), the GFCI highlights the rising of Qingdao (33rd), Taipei (34th) and Chengdu (73rd).
Other important financial centres in Asia are in Japan (with Tokyo and Osaka respectively 6th and 27th), South Korea (Seoul 36th and Busan 43rd) while the leading centers in the ASEAN countries all ranked in the TOP10 (Kuala Lumpur 45th, Bangkok 50th, Jakarta 91st, and Manila 97th).
A new FinTech index accompanies the GFCI for the first time. The Fintech index is dominated by Chinese cities which fill five out of the top seven places with by Beijing and Shanghai taking pole position.
Fintech has penetrated a wide variety of financial services in China, ranging from digital payments, digital insurance to online banking, and mobile wealth management.
At the back of the industry's robust growth are primarily two factors, one being the rapidly growing domestic consumption countrywide, the other factor lies in the fact that China has spearheaded in the adoption of relevant cutting-edge technologies among consumer-oriented financial services.