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Daisy Wu

An Asian city will eventually overtake London and New York as the world’s leading financial centre, with Hong Kong well placed to compete for the top spot given its legal predictability and low tax burden, according to the creator of a closely watched ranking of financial hubs.
“It’s going to happen because it’s so tight,” said Michael Mainelli, chairman of London-based think tank Z/Yen Group, in an interview with the South China Morning Post on Tuesday, referring to the narrowing gap between Hong Kong and the traditional leaders.
In the March edition of the Global Financial Centres Index (GFCI) – compiled twice a year by Z/Yen and Shenzhen’s China Development Institute – Hong Kong placed third, trailing London by a single point and New York by two. The next edition is set for release later this month.
Mainelli attributed the tightening race to a broader structural shift towards Asia, which now accounts for roughly 40 per cent of global finance.
“At some point, there will be an event,” he said, meaning a change at the top of the rankings.
Recent macroeconomic volatility, including geopolitical tensions in the Middle East, had weighed on the ratings of some major hubs, but Hong Kong’s underlying framework was unusually resilient, Mainelli said.
Central to that, he said, was Hong Kong’s common law system, which let international firms sign and enforce contracts on terms they already understood.
Mainelli noted that while many jurisdictions lacked regulatory predictability, Hong Kong sought to retain confidence in the rule of law through its judicial independence.
He contrasted Hong Kong’s environment with regulatory friction in the United States. As an example he cited differing opinions from courts on whether Kalshi’s sports-related contracts were gambling subject to state laws or financial derivatives regulated federally – a conflict likely headed to the Supreme Court.
Fiscal discipline offered another durable edge for Hong Kong, Mainelli said. State expenditure as a share of gross domestic product – a better indicator of stability than individual tax breaks – was roughly 15 per cent in Hong Kong, compared with around 19 per cent in Singapore and more than 40 per cent across Europe, he said.
Following rival tax-incentive announcements from Singapore and Hong Kong, Mainelli cautioned that frequent policy shifts could erode business confidence.
“The more a centre flips its tax regime around to suit circumstances, the less confident I am your tax regime is stable,” he said, “Predictability is what international participants are after.”
The March GFCI survey revealed that predictability was the primary regulatory demand among businesses, outranking response speed, flexibility and overall quality. Cost was identified as the least significant consideration.

Mainelli dismissed concerns that fast-growing mainland Chinese hubs like Shanghai and Shenzhen – ranked sixth and ninth, respectively – would eclipse Hong Kong. Instead, he argued that their growth reinforced Hong Kong’s role as an open, common-law gateway to mainland capital.
The city’s investments in gold-trading infrastructure, including a central clearing and settlement system that began trial operations in July and a plan to expand vault capacity near the airport to more than 2,000 tonnes, would “benefit Hong Kong enormously”, Mainelli said.
Looking ahead, he said that the city’s main long-term challenge involved balancing mainland integration with global accessibility.
“The biggest real threat to Hong Kong … is probably the government losing sight of how much openness matters to business,” he said, adding that the one country, two systems framework remained highly effective as long as commercial openness was preserved.
Hong Kong’s eventual rise to the top of the ranking hinged on it continuing to “treat everybody fairly”, he added.


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‘It’s going to happen,’ creator of Global Financial Centres Index says, as long as city maintains openness and predictability


‘It’s going to happen,’ creator of Global Financial Centres Index says, as long as city maintains openness and predictability.


Hong Kong poised to top New York, London in finance-hub ranking: GFCI creator

.css-1c6uqr6{color:inherit;font-weight:inherit;font-size:inherit;font-family:inherit;line-height:inherit;overflow-wrap:break-word;}‘It’s going to happen,’ creator of Global Financial Centres Index says, as long as city maintains openness and predictability

‘It’s going to happen,’ creator of Global Financial Centres Index says, as long as city maintains openness and predictability