Where tomorrow’s finance powerhouses are rising

Tallinn, Estonia

New York and London are still the two most powerful global finance centres, research by two think tanks suggests. But up-and-coming hubs in China are closing in, and tomorrow’s finance powerhouses are emerging across Asia, in Eastern Europe, and in the Middle East.

The Global Financial Centres Index (GCFI) was established in 2007 and is released twice a year by London-based Z/Yen and the China Development Institute. New York City and London have traded the top spot back and forth for at least half as long as the GFCI has existed. In September 2018, New York City eked out a two-point lead over London.

But the two hubs’ ratings have decreased in the past six months.

Nipping at their heels and vying for the top spot are Hong Kong, Singapore, and Shanghai, global finance centres whose competitiveness is fuelled by China’s economy and technological advances such as artificial intelligence and cloud technology.

Ten years after a meltdown in the US banking and financial services industry spread to Europe and recessions hit on both sides of the Atlantic, New York City and London are losing competitiveness amidst uncertainty about Britain exiting the EU and the US’s tariff issues with various countries.

Meanwhile, Hong Kong, Singapore, and Shanghai have solidified their position as prominent finance centres, and Germany is another rising finance powerhouse. Frankfurt leapt ten places into the 10th rank on the September 2018 GFCI. Zurich, which moved into 9th, and Frankfurt benefited from the Brexit uncertainty that cost London its top spot, according to the think tanks’ research. Other Brexit beneficiaries include Amsterdam and Vienna.

Emerging finance centres

The first GFCI ranked just four finance centres, London, New York, Paris, and Frankfurt. Since then, the number of hubs tracked has increased to 100, with emerging finance centres in Asia, the Middle East, and Eastern Europe.

Promising newcomers include Tallinn, Estonia’s capital, and Seoul. Infrastructure investments and financial sector developments are boosting the cities’ competitiveness. Also up-and-coming are Dubai and Abu Dhabi in the United Arab Emirates, Qatar’s capital Doha, and Cape Town in South Africa. In Latin America and the Caribbean, the fortunes of Bermuda, the Cayman Islands, and Sao Paulo are rising.

GFCI rankings are determined by competitiveness factors such as business environment, reputation, and infrastructure and a global survey that involves nearly 2,500 respondents. Survey respondents are asked which financial centres they think will become more significant in the next two to three years.

Shanghai, Qingdao, a port city in southeastern China, and Guajarat in India topped the list of 15 rising finance centres that survey respondents mentioned most in the past 24 months.

Top 10 global finance centres

Not much changed in the middle of the GFCI’s top ten list in the past six months, where Hong Kong and Singapore maintained their rankings, and Shanghai and Tokyo switched places. The bottom half of the top ten, however, looks quite different from six months ago. Sydney rose two places. Moving into the top ten, Beijing, Zurich, and Frankfurt improved their rankings significantly since March 2018, relegating Toronto, San Francisco, and Boston from the top ten to the top 20.

  1. New York City  (2nd in March)
  2. London  (1st in March)
  3. Hong Kong  (3rd in March)
  4. Singapore  (4th in March)
  5. Shanghai  (6th in March)
  6. Tokyo  (5th in March)
  7. Sydney  (9th in March)
  8. Beijing  (11th in March)
  9. Zurich  (16th in March)
  10. Frankfurt  (20th in March)

Sabine Vollmer ( is an FM Magazine senior editor.