Dubai in Top 5 financial centres

A new ranking puts Dubai among the top 5 financial centres for new office openings this year, among the likes of Singapore, Hong Kong, London and Shanghai.

The just published Global Financial Centres Index, which tracks competitiveness among 77 international financial hubs, also sees Dubai regain its top slot among regional financial centres, overtaking Qatar once again as the regional hub of finance.

Source: Global Financial Centres Index 2011

Overall, Dubai improves its global ranking from #36 in 2010 to #29 in 2011 even as London, New York and Hong Kong and Singapore retain the top 4 slots globally in the Index published twice annually by the Z/Yen group. Tokyo replaces Shanghai at the No. 5 slot this year.

“Of the four Middle Eastern centres in the GFCI, Dubai has overtaken Qatar to regain the status of leading Middle Eastern centre,” the report says, adding that Qatar’s strong fundamentals mean that it will remain a challenger to Dubai.

“We believe that Qatar has strong underlying fundamentals to challenge Dubai,” it said. Qatar dropped eight slots to land at #38 in the latest rankings compared with #30 in the previous edition.

At #48, the UAE’s capital city, Abu Dhabi, joined the rankings for the first time since the Index was first published in 2007, but is already ahead of Bahrain, which dropped two slots to land at #57 in the latest rankings. “Abu Dhabi is a new entrant to the GFCI and has come in just above Bahrain. Johannesburg [#55] and Istanbul [#61] do not yet fulfil their potential,” the report stated, adding that analysts at Z/Yen “expect Istanbul to become more significant in the medium term.”

With a global ranking of #70, Saudi Arabia’s Riyadh brought up the bottom of the regional financial hubs.

Source: Global Financial Centres Index 2011

The report maintains that although the trend of large jumps in the Asia/Pacific financial centres’ rankings is subdued this year, it is only a matter of time before they emerge as global leaders.

“The past trend of large rises in the ratings of Asia/Pacific centres has paused,” it said, adding that the overall scores of Hong Kong, Singapore, Tokyo, Shanghai, Beijing, Taipei and Shenzhen all declined in the latest rankings. “Centres on the mainland of China have seen significant declines with Shanghai down 37 points and Beijing down 11. Hong Kong sees a 16 point drop and is now 27 points below London,” the report said.

“We believe that these results in Asia are just an interlude in the long-term trend of the increasing importance of the region rather than a fundamental change in fortunes,” the report maintains. “Overall respondents think that the Asian centres will continue to become more significant. Some respondents question whether financial centres on mainland China will be able to continue their growth without relaxations in currency controls. It is worth noting that Seoul and Sydney are the only centres in Asia/Pacific showing higher ratings than in GFCI 10.”

The GFCI provides ratings for financial centres calculated by a ‘factor assessment model’ that uses two distinct sets of input: Instrumental factors (external indices that contribute to competitiveness) and Financial centre assessments, by means of an online questionnaire.

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