Hong Kong to be world's biggest financial centre by 2016
Hong Kong is to overtake New York as the world’s biggest financial centre by 2016, the Centre for Economics and Business Research (CEBR) has stated.
According to the independent economics consultancy, there is going to be an intense proliferation of jobs in finance sectors within the city-state, with New York unable to match that over the next four years.
New York, in comparison to London, has been propped up by a comparatively stronger economy, relatively insulated from the turmoil on the eurozone.
London meanwhile, which had been the number one global financial centre across all categories –wealth, employees, influence – has been hit hard by both the recession and the ensuing economic malaise.
Having already lost the top spot to New York this year, it is set to slip further down the rankings, with Singapore “snapping at its heels”.
Unable to match the innate growth potential of emerging economies – an unfortunate reality of operating within a highly industrialised nation – the City of London is struggling to maintain its dominion over finance, the CEBR explained.
Douglas McWilliams, the consultancy’s chief executive, said that the shift from the west to the east has been inevitable, reflective as it is of the “changing economic geography”.
Furthermore, New York and London have suffered from “short-sighted overregulation” and “banker bashing”, with the general public – and politicians – cynical about whether financial institutions have really turned over a new leaf.
The impact of this will be exceptionally profound, especially for London, which could dent any hope of the UK achieving reasonable levels of growth.
Mr McWilliams elaborated: “Taking into account the loss of income from a much smaller City, from lower corporation tax, stamp duty and other city based taxes, I estimate that government revenues from the City in the current financial year are likely to be about £40 billion compared with the £70 billion which it received in 2007/08 at the peak of the cycle.
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