Hong Kong poised to challenge London and New York as top financial centre, says GFCI creator

An Asian city will eventually overtake London and New York as the world’s leading financial centre, with Hong Kong well placed to compete for the top spot given its legal predictability and low tax burden, according to the creator of a closely watched ranking of financial hubs.

“It’s going to happen because it’s so tight,” said Michael Mainelli, chairman of London-based think tank Z/Yen Group, in an interview with the South China Morning Post on Tuesday, referring to the narrowing gap between Hong Kong and the traditional leaders.

In the March edition of the Global Financial Centres Index (GFCI) – compiled twice a year by Z/Yen and Shenzhen’s China Development Institute – Hong Kong placed third, trailing London by a single point and New York by two. The next edition is set for release later this month.

Mainelli attributed the tightening race to a broader structural shift towards Asia, which now accounts for roughly 40 per cent of global finance.

“At some point, there will be an event,” he said, meaning a change at the top of the rankings.

Recent macroeconomic volatility, including geopolitical tensions in the Middle East, had weighed on the ratings of some major hubs, but Hong Kong’s underlying framework was unusually resilient, Mainelli said.