Cayman falls further in financial centres global index

| 21/09/2010

(CNS): The Cayman Islands, along with most other offshore financial centres, has fallen down the ratings in the latest edition of The Global Financial Centres Index. The GFCI started in 2005 and examines financial centres from the perspective of those who use them as well as the instrumental factors such as the data and statistics about the actual business. The index authors examine 75 places with a financial services industry and this year all of the offshore centres have again lost ground in the ratings showing larger falls than average. The Cayman Islands lost 23 points and fell six places since the last assessment in the index to position number 38. When the survey started Cayman was in the top 20.

 
The report revealed that all offshore centre show larger falls than average, continuing a trend, authors say, since the financial crisis began.  “The Caymans and the Bahamas are just not places to be seen doing business right now – they still have (probably unfairly) a dirty reputation,” a Trust Fund Manager based in New York who took part in the survey said.
 
While London and New York remain on top of the GFCI 8 index Hong Kong is now in 3rd place and only ten points behind the two cities having been 84 points behind them eighteen months ago. “Hong Kong has joined London and New York as a genuinely global financial centre,” the report said. “Singapore may well join this trio soon.”
 
The authors also found that confidence amongst financial services professionals has fallen since GFCI 7, as shown by lower overall ratings – 53 centres have lower ratings in GFCI 8 compared with just 17 centres having higher ratings, while five have the same.
 
All of the Asian centres are climbing with Shanghai increasing its rating by 25 and Hong Kong by 23 points.
 
“Asia continues to exhibit enhanced competitiveness with Shanghai entering the top ten and Seoul moving into the top 25,” the report revealed. When asked which financial centres are likely to become more significant in the next few years respondents pointed to Shenzhen, Shanghai, Singapore, Seoul and Beijing.
 
The report stated that the business environment is still viewed as the key area of competitiveness and is now mentioned in responses far more often than people or infrastructure. “One of the themes that emerges from the GFCI 8 responses is the need for predictability and stability of regulation and taxation,” thereport said.
 
Uncertainty over regulation and tax levels is the issue that worries those who were surveyed the most and changes in taxation, economic and business freedom, government support for the finance sector, transparency and predictability of regulation and the reputation of financial centres are all seen as key
determinants in their likely success.
 
The three centres with the highest reputational advantage were Shenzhen, Shanghai and Beijingreinforcing the popularity of the Asian jurisdictions and China’s increasing importance on the global financial stage.
 
Formerly sponsored by the City of London Corporation for the GFCI 8 was sponsored by the Qatar Financial Centre Authority.
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Comments (32)

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  1. So says:

    So if most of you are correct the big bucks are coming form the East now? Well whydont we tear up all of those agreements that Mac has been signing and start ignoring the USA, UK, France, Germany etc as it is obvious that they are on the decline and focus our marketing on the Eastern nations? Perhaps we need to also start teaching Mandarin in our schools and introduce Eastern literature and focus more on Eastern Geographyand social studies? The USA is doomed, everybody knows that, they wont fail completely but they will diminish in influence and power. The Chinese already own most of the power in the USA as it stands. Hey maybe Casto can put in a word for us ? Mac you can send me to Cuba with the message. Or maybe I could speak to Mr Chavez instead.

     

     

  2. anonymous says:

    He is probably going to Hong Kong to sign more agreements and shoot himself in the foot again.  By next year we will fall further and further..

  3. Anonymous says:

    No surprises here!

  4. Anonymous says:

    So we fall…  just get back up again and move on…

  5. Anonymous says:

    Cayman has to live up to the fact that its financial service industry is in terminal decline.  This will lead us on an unhappy path to property price collapses, a massive reduction in government income and all the problems that that spiral will bring.

    • Anonymous says:

      Congratulations McKeeva Bush. You are once again taking us in the wrong direction. You promised us sooooo much before & after the elections but you have delivered sooooo little!

  6. Anonymous says:

    Never mind, Tony Travers will write them a letter (on behalf of the Premier) and they will have to do it all over again.

  7. going, going, gone says:

    No big surprise there!  And since the premiere approach to problems is to make them worse Next year it will be far worse until Caymans once great financial center is just a memory.  How will he pay for all his first class travel then.  And more important how will the people of Cayman deal with the loss?  We will find out.

    • Lachlan MacTavish says:

       The financial, legal and accounting firms in The Cayman Islands are some of the best in the world. The issue we have now is the leadership and the Government. The islands tourism has eroded due to lack of attention from the CIG. Now it looks like the professional services will suffer as well.

      • Joe Mamas says:

        The financial, legal and accounting firms that have already left Cayman are some of the best in the world.  And the Smartest.  The rest are just waiting for their leases and permits to run out.  Not like any of them expect it to get better just because of the promises of your mostly absent and unreliable leadership.

      • offshore finance, back onshore says:

        Hey Lach, I hate to say it but the firms are contracting as the business migrates out to jurisdictions that are less expensive, more inviting and stable for the hired talent, and are not so, er, "impacted" by the reputation Cayman carries forward from the days of booking deposits out of suitcases. 

        Of course Mac has done nothing to stem the out-flow, and both recent governments of Cayman have made it greatly more expensive, much less inviting to the hired talent, and frankly less attractive as a "stable and reliable" jurisdiction. (So no PPM v UDP crap, OK? They’ve both xxxxed it up for everyone.)

        And yes, "The financial, legal and accounting firms in The Cayman Islands are some of the best in the world", however they are more and more located in other jurisdictions, and it would be nice if they came back at least to visit. 

  8. Anonymous says:

    what a mess …..

  9. whodatis says:

    There is a very simple explanation for all of this:

    The ‘West’ is centralizing itself in order to better compete (albeit a losing battle) against the ‘East’.

    London, New York, Chicago (say wha’?!), Zurich etc …

    Even if we were the best of the best in the industry right now it would never be acknowledged.

    Politics rule yet again.

    (The ‘West’ is now officially a pathetic joke on its last legs. Very interesting times we are in.)

    Weaponry and the great "Climate Change" sham of a scam (projected "Green economy / jobs") are its last 2 (WMD) tricks in the bag.

    Nonetheless, the naysayers simply refuse to see the simple truth before them.

     

    • Anonymous says:

      Wow, whodatis, even by your extraordinary standards, this is truly impressive.

      • whodatis says:

        Why, thank you oh so much – really, you’re far too kind.

        :o)

        • Caymanian 2 Da Bone says:

          You do know that over 99% of scientist beleive that the climat is changing don’t you.

           

          PLease provide some evidence that the world’s climate has remaiained static for the last billion years?

          You must have some evidence to back up your "Climate change scam theory"

          • Pauly Cicero says:

            The scam is the notion that humans can change it

            • whodatis says:

              @ Pauly:

              Thank you.

              That is perhaps the shortest and most effective response to this issue that I have ever heard!

              :o)

              (It is amazing what the masses will swallow down as a collective.)

              • Pauly Cicero says:

                De nada.

              • Caymanian 2 Da Bone says:

                Yep that’s up there with the:

                The earth is round scam

                The Evolution existing scam

                The Holocaust scam

                The Smoking kills scam

                The light is a wave scam

                and the concentric solar system scam

                I know it’s amazing people believe these things 😉

                • whodatis says:

                  Why does this discussion always devolve into these ridiculous and childish sentiments?

                  At the very least we should be able to stick to the topic at hand – no?

                  Yet another reason why I have stopped participating in drawn out debates on this issue.

                  It truly has become the latest religion – and we all know better than to debate religions.

                  Just one piece of advice – search beyond the headlines of the mainstream international media … in this and all other issues.

                  • JIM says:

                     you brought the subject up in the firstplace, so heed your own advice.

                    As for searching beyond headlines, try some reading yourself beyond the national enquirer and don’t put to much stock in "scientific" reports produced under fossil fuel company grants. After all oil companies are using the same quasi science "labs" as the old tobacco companies used.

                    Quick fact, last year oil companies spent close to 10 times more on lobbying their interests in the US, than enviromental groups spent.

                    trying to muddy the waters on either smoking being bad for your health or that humans can’t affect our climate is very big business indeed

                     

                     

              • Real Scientists says:

                You brainiacs really take the cake in misleading people.  I suppose you want people to think the world is flat as well. People, don’t believe these flat-Earthers!!!

                Reality: The US Environmental Protection Agencyranks the major greenhouse gas contributing end-user sectors in the following order: industrial, transportation, residential, commercial and agricultural. Major sources of an individual’s greenhouse gas include home heating and cooling, electricity consumption, and transportation. Corresponding conservation measures are improving home building insulation, installing geothermal heat pumps and compact fluorescent lamps, and choosing energy-efficient vehicles. Carbon dioxide, methane, nitrous oxide and three groups of fluorinated gases (sulfur hexafluoride, HFCs, and PFCs) are the major greenhouse gases.  Since about 1750 human activity has increased the concentration of carbon dioxide and other greenhouse gases.   Measured atmospheric concentrations of carbon dioxide are currently 100 ppmv higher than pre-industrial levels. As a species we belch gasses like certain politicians, and while there are natural sources of these gasses we can’t ignore the fact that WE’RE pumping them out at a very UNNATURAL rate. 
                 
                Either way though,  heating up the Earth could push it to be like Venus, which  has the densest atmosphere of all the terrestrial planets in our solar system consisting mostly of carbon dioxide. Venus has no carbon cycle to lock carbon back into rocks and surface features, nor does it seem to have any organic life to absorb it in biomass. A younger Venus is believed to have possessed Earth-like oceans, but these evaporated as the temperature rose, leaving a dusty dry desert… That’s what Whodatis wants to turn Earth into.
                • Pauly Cicero says:

                  The Earth will cleanse herself regardless of what we humans do. Too bad we weren’t around during the last Ice Age. Between human propagated greenhouse gas emissions and dinosaur farts we could have spared the world from global freezing. I do not deny that global climate change is happening but I deny that we can stop it. If the Earth is going to roast us off her face that’s what is going to happen, unless we poison ourselves out of existence before Earth gets around to us. I embrace the science and fact that the earth is round (actually very nearly round). I do not doubt science. I do not doubt that Earth goes through catastrophic warming and cooling cycles. I do not embrace the religion-like scam theory that man can do a damn thing to stop it. What I can get my head around is the theory that man can reduce the process where we are hastening our demise through pollution. However, buying ourselves a few hundred or thousand years will not halt the global cycle and humans will eventually be purged from Earth should the scientifically predicted events arise.

                  Braniac flat-Earther? I think you have me mixed-up with someone else.

    • Slowpoke says:

      You need to stick to one point in your posts.

      What you wrote is like asking a student "Do you like your teacher, are you happy with your grade and will you do well next year? Rate from Strongly Agree to Strongly Disagree 1-7".

      I agree with some of your points but disagree with others.  It’s OK to have more than one comment on CNS. 

      • whodatis says:

        Context is everything and everything is relative.

        I encourage you to avoid looking at the major issues facing the (Western) world today in isolation.

        Do your (proper) research, study (real) political, financial, and organizational history – the amount of overlap you will uncover will astound you.

  10. Department of deFinance says:

    We all know there isn’t a net on our future.  We can fall right through the floor on this, and we’re dropping like a rock already.  Notably Asia is the rising sun in the world of finance (as ours sets), so Mac is certainly and literally heading in the right direction to try to drum up some business for us.

    I remember back in the day when Cayman tried to hold itself out as the world’s fifth largest financial centre.  That was not true then, but certainly we were at the top of our game.  Down to 38 though – my how the once mighty have fallen! 

    As for who to watch out for, Hong Kong is now in the same league as London and New York, so look out for business migrating that way.  I wonder if anyone’s looking at what Hong Kong is doing right contrasted to what Cayman is doing wrong?  That could have been us but for….

    • Common Sense says:

      This is not a ranking on the size of Cayman’s financial industry or other OSFC in terms of deposits held but rather on other factors such as "the perspective of those who use them".

      Be mindful of these so called rating firms/agencies. Those who pay the most are ranked the best.  No surprise that London ranks second. After all it once sponsored this report.

      With the goal of high tax jurisdictions to crush all Offshore Financial Centres, there should be no surprise that OSFC’s are all "slipping" in rankings created by a high tax jurisdiction.

       

      • whodatis says:

        That’s basically what I said – just in another way … however, when I do it I get showered with significant negative feedback.

        Regardless, everyone wants to jump down the back of the Cayman government and our policies (fees, costs, immigration) etc. and pretend as if such issues are actually the impacting factors in this scenario.

        This takes me back to my controversial ‘self-respect’ post that I submitted a few days back.

        Too many of us are playing dumb just to have something to say.

        I thought we imported bright and brilliant minds to ‘help’ move along our economy?

        Quite pathetic.

      • offshore finance says:

        Either way, would the last one to leave the Island please turn off the cash machine?