Luxembourg, an emerging global contender
The Z7Yen Group has published its eighth Global Financial Centres Index (GFCI) covering 77 financial centres. The big change from six months ago is that Hong Kong has joined London and New York as one of the “Big Three” global financial centres. GFCI respondents believe that the Asian centres will continue to increase in significance in the medium to long term. Though there have been some improvements in Europe, the Euro crisis continues to be reflected in the ratings of financial centres like Madrid, Lisbon, Athens and Dublin.
London, New York and Hong Kong once again occupy the top three positions in the latest edition of the GFCI. The authors of this study continue to believe that the relationships between these three centres are mutually supportive. While some industry professionals still see a great deal of competition, others appear to recognise that collaboration on certain elements of regulatory reform is likely to enhance the competitiveness of these centres. Furthermore, London and New York must not believe that they are “untouchable”. Whilst some Asian centres have declined in the latest survey, the long-term trend of the leading Asian centres is upward.
This trend is also visible in the list of the top ten centres most likely to become more significant. Singapore comes out on top, followed by Shanghai and Hong Kong. The Luxembourg financial centre achieved a very good score, being placed in sixth position. Luxembourg is also found in the top ten centres where new offices will be opened.
Overall, the Grand Duchy comes in 24th place and loses one position relative to the previous study (March 2012). At the European level, Luxembourg ranks fifth and is overtaken by London (first in the overall ranking), Zurich (5th), Geneva (9th) and Frankfurt (13th).
When it comes to financial centre profiles, Luxembourg is considered, together with Moscow, to be a global financial centre in the "emerging global contender" category. Although its activities appear to be internationally recognised, the range of financial services is not yet considered to be broad and deep enough.
Finally, we find again in this study an analysis of the volatility of the various financial centres. In this context, Luxembourg is considered to be a “dynamic” centre. It can be found in between the financial centres considered "stable" and those considered "uncertain". This means that Luxembourg has the potential to move in either direction. CW