Competition between the world’s top financial centres is levelling out, according to a new survey.
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Although New York, London, Hong Kong and Singapore continue to dominate the rankings, the difference between Wall Street and the City of London is just a wafer thin margin of a single point, says the latest Global Financial Centres Index from researchers Z/YEN.
Marked out of 1,000 points across a broad range of factors, thousands of bankers and financiers worldwide contributed their opinions to the study.
Most of the top 30 world financial centres failed to perform well.
Only two of the top 15 improved their ratings – San Francisco (Up 8 points) and Vancouver (Up 2 points), while just seven in the top 30 rated higher than last year.
Overall, many financial centres worldwide saw their ratings fall as government attitudes to regulation and taxation of offshore assets post-downturn tightened up.
Offshore centres
Offshore centres like Jersey, Guernsey and the Isle of Man without exception saw their stars wane along with the top 10 Western European onshore financial centres.
The tax crackdown led by the USA Foreign Account Tax Compliance Act (FATCA), which came into force in July, along with an unrelenting attack from the US Justice Department against tax evasion advice from Swiss banks, has affected many jurisdictions badly.
Traditional banking bastions such as Zurich, Geneva and Luxembourg all saw their popularity decline.
Meanwhile financial centres untainted by allegations of tax evasion saw their scores rise.
Istanbul, Almaty and Prague all increased their scores, while Moscow’s financial woes with a free-floating rouble, high inflation, falling oil prices and economic sanctions imposed over the annexation of The Crimea returned a disappointing rating.
Other poor performances were returned by financial centres in the Asia Pacific and North America, with the occasional shining light, like San Francisco and Vancouver.
The rankings
The best performances were in the Middle East and Africa.
Dubai and Abu Dhabi in the United Arab Emirates and Riyadh, Saudi Arabia, all displayed improvement in their ratings, reflecting a move towards tighter financial regulation, especially in the Emirates.
Qatar dropped some points compared with the last ratings, but still climbed a few places. However, the country’s banks are dogged with controversy about support and money laundering for terrorism, including the militant Islam State.
In Africa, Johannesburg, South Africa, and Casablanca, Morocco, both moved up a dozen places.
The top 10 rankings were:
- New York 778
- London 777
- Hong Kong 756
- Singapore 746
- San Francisco 719
- Tokyo 718
- Zurich 717
- Seoul 716
- Boston 705
- Washington DC 704
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