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Seoul lags as an international financial hub

The Corporation of London has just launched a new index: the Global Financial Centres Index. It’s a way of ranking various cities that aspire to being recognised as international financial services centres. It was launched in Cannes last week at MIPIM, the international property industry boondoggle. The occasion provided the opportunity to update the City’s report on the leaders and laggards in international finance. Here’s a bit of background from the report.

We believe that this categorisation identifies four types of financial centre:
Cover from the City's Global Financial Centre Index report

  • Leaders: obviously London and New York, but also centres with strong sub-sectors and strong domestic markets;
  • Minor: cities that are not rated as highly, and are unlikely to improve in the near term. It is interesting to note that Rome, Moscow, Mumbai, Seoul and Warsaw fall into this category. Each of these centres have large domestic markets, but seem unlikely to change their poor ratings soon;
  • Volatile: cities that are not rated as highly, but might be able to move upwards rapidly if they could fix some factors. Interestingly, Athens has gained from improvements in infrastructure due to the 2004 Olympic development, but needs similar improvements in the other four groups of factors to improve its competitive position;
  • Evolving: cities with high ratings, but susceptible to change. It is interesting to see that Dubai and Shanghai are already matching established centres such as the Channel Islands and Hamilton. Dubai has clearly focused on attracting regional business, while Shanghai has been the focal point for its domestic business. As their financial services broaden and deepen, we expect these two centres to move towards the “leaders” box.

The report ranks 46 cities using this index. Here’s the bottom of the league table

40 Warsaw
41 Prague
42 Lisbon
43 Seoul
44 Budapest
45 Moscow
46 Athens

The full report is available here. Read how the index is constructed to see if Seoul’s lowly position is justified.

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