by CHAN King Cheung
Hong Kong slipped into the fourth place in the Global Financial Centre Index (GFCI) published by a UK research institute Z/Yen Group last week, trailing behind London, New York and Singapore. Coming in the heels of the separate downgrading of Hong Kong’s credit outlook by Moody’s and Standard & Poor’s from stable to negative, the drop of Hong Kong’s ranking has deepened the air of gloom over the city. Some people say Hong Kong has got a problem.
Hong Kong has given great concern to its international ranking in various ratings before and after the 1997 changeover. Economic freedom index. Competitiveness and financial centre index. The list goes on. Most, if not all, of those rankings are more “abstract” than “real.” Their impact is more about international perception than substance. The ups and downs of ranking have arguably had no major impact. The fact is they have become less important in the recent years.
The outlook ratings of credit-rating agencies is real, however. It will directly affect the cost of governments and enterprises in loan-raising. Their ratings tend to fluctuate from bad to worse and the other way round. They are more important than those rankings because they reflect the economic environment and risk of certain places, but not a rigid comparison between them and other countries and regions.
Singapore will be most happy with the GFCI. The Singapore newspaper Lianhe Zaobao’s headline read “Our nation supersedes Hong Kong to rank third in GFCI.” Their report stressed the Lion’s City ranks Number One in Asia. In the GFCI report, it has highlighted the deficiencies of Singapore. In term of reputation, Singapore ranks lower than Qingdao, Casablanca and Sydney.
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Full article: http://www.vohk.hk/2016/04/13/hk-financial-hub-ranking-fall-no-cause-for-worry/
