The global financial centres index (GFCI) 3 - Z/Yen

The Global Financial Centres Index
What change in the ratings is considered significant At this
stage in the development of the GFCI, a movement of less than
ten points (1% on a scale of 1,000) is considered insignificant 4 .
A movement of between 10 and 30 points signifies that the
competitiveness of a financial centre needs to be watched.
A movement of more than 30 points shows that a major change
in the competitiveness of a financial centre may be under way.
The top eight centres remain unchanged in rank since the
previous index, with Sydney dropping below Tokyo from 9th to
10th. Eight centres new to GFCI made the top 50 this year.
Major movers include Jersey (+35), Guernsey (+31), Shanghai
(+27), Bahrain (+59), Johannesburg (+48), and Qatar (+51). As in
the previous two editions of the GFCI, this can be a result of a large
variance in centre assessments (some respondents rate them
highly and some respondents rate them poorly), or a high
sensitivity to instrumental factors (their ratings react strongly
to changes in instrumental factors), or both. Osaka showed
the greatest fall in the ratings (-33), followed by Sydney and
Melbourne (-15 each).
Dubai and Qatar, both identified in GFCI 2 as emerging, volatile
centres, have continued to gain significance in GFCI 3,
highlighting their role as important regional financial hubs in the
Middle East and beyond. The consistently high price of oil and
massive investments by national governments in the creation of
financial hubs have helped to raise these two centres in the Index.
Whether they can continue to climb depends on many factors,
not least of which is broad improvement in all five competitive
aspects, in particular financial infrastructure, where both received
relatively low scores.
Some centres are no longer in the top 50 of GFCI 3, for a variety of
reasons. Some are now substantially lower in rank without a
corresponding drop in rating (Mumbai, Rome, Seoul, Wellington,
Sao Paulo, Prague and Warsaw) as a result of new centres being
added and scoring more highly in the Index. Osaka, in contrast,
dropped 18 ranks, but also lost 33 points in the GFCI ratings, which
indicates that more than just a ‘displacement’ effect is taking
place since GFCI 2.
Other centres deserve note as well. Wellington, which had
fallen 61 points in GFCI 2 and was highlighted as particularly
sensitive, dropped completely out of the top 50 in GFCI 3.
Shanghai again demonstrated its volatility, rising 27 points after
dropping 49 in GFCI 2.
4 In GFCI 2 we estimated
significance at 25 points,
and highlighted that the
threshold would fall with
the expansion of the
data set and duration of
the GFCI.
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