Cape Town overtakes Joburg in latest financial rankings as economies evolve

The Global Financial Centers Index (GFCI 32) provides future competitiveness assessments and rankings for 119 financial centers around the world, including two cities in South Africa – Johannesburg and Cape Town.

The report, a collaboration between the China Development Institute (CDI) in Shenzhen and Z/Yen Partners in London, is updated and published every March and September.

It is compiled using 151 instrumental factors, grouped into five broad areas: Business environment, human capital, infrastructure, financial sector development and reputation. These quantitative measures are provided by third parties, including the World Bank, the Economist Intelligence Unit, the OECD and the United Nations.

The instrumental factors are combined with financial center ratings provided by respondents to the GFCI online questionnaire. GFCI 31 uses 66,121 ratings from 11,038 respondents.

New York tops the index, with London second, ahead of Singapore in third, which overtook Hong Kong in fourth. Paris returned to the index’s top 10, replacing Tokyo, which fell to 16th place, possibly reflecting a relatively slow recovery in consumption from the Covid-19 pandemic, the authors said.

The ranking of Chinese financial centers continues to climb steadily. A total of 12 financial centers on the Chinese mainland are on the list. Beijing retains its 8th place among global financial centers and Shenzhen moves up to 9th place.

Among the top 40 centers, three centers gained 10 places or more, and one lost more than 10 places. All but one of the centers in the top 40 have increased their rating in the index, and only 11 of the total 119 centers dropped in the ratings.

Middle East and Africa

Dubai and Abu Dhabi occupy first and second place in the region, with Dubai stable in the rankings at 17th place and Abu Dhabi falling one place in the ranking.

Casablanca continues to be the top African center, maintaining its 54th position overall, while other African centers have dropped in the rankings.

Cape Town beats Johannesburg, ranking 64th ahead of the country’s largest city, which ranks 65th. Both cities slipped down the rankings of the 31st edition of the index.

Middle East and Africa Centers

Great economic shift towards Cape Town

New building data for South Africa shows an economic shift between the two regions – with the Western Cape’s annual building plans adopted for 2022 likely topping those of Gauteng for the first time in recorded history.

“Years of building a popular ‘brand’ as a lifestyle and well-run region are looking to pay off more and more for the Western Cape’s economy and property market,” said John Loos, property strategist at the ETFs.

Loos said that for more than two decades, the FNB had noticed a growing trend of “net out-migration” of skilled, high-income households, particularly towards the Western Cape, but also towards some coastal areas of KZN.

“This has led to the expectation that the Western Cape economy will at some point start to outperform the others, as South Africa’s modern service-dominated economy is highly dependent on labour. skilled work, and the Western Cape is best placed to attract and retain them.”

On top of that, skilled migrants bring significant purchasing power to the region, he said.

FinTech

The China Development Institute (CDI) and Z/Yen Partners also evaluated 113 centers for their Fintech offering.

New York maintains its leading position in the Fintech rankings, followed by San Francisco, Los Angeles and London, with Shanghai and Beijing in fifth and sixth places.

Chinese, American and German hubs performed well in the Fintech rankings, with Atlanta, Chengdu, Berlin, Stuttgart, San Diego, Tianjin, Dalian, Nanjing, Hangzhou and Wuhan improving over 10 ranking places.

outside of these countries. Helsinki, Oslo and Lugano also moved up more than 10 ranking places.

Cape Town again ranks above Johannesburg for Fintech.


Read: Big economic shift to Cape Town creates problems for Gauteng

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