Reasons cited include growth of private wealth management in country
WASHINGTON: New York has withstood the worst economic crisis in seven decades and remains the leading global financial centre, followed by Singapore, which pipped London as investors' preferred place for doing business, according to the Bloomberg Global Poll.
Twenty-nine per cent of respondents in the quarterly poll of investors, traders and analysts who subscribe to the Bloomberg terminal said New York will be the best place for financial services two years from now. Singapore was chosen by 17 per cent of respondents while London was the pick of 16 per cent. Shanghai had 11 per cent, while Tokyo, once considered a global hub, got the nod from only 1 per cent.
'Despite the carnage of 2008, I still expect the 'new new' thing in financial services to be developed and nurtured here (in New York), and ultimately exported to the world,' said respondent Peter Rup.
On a separate question, respondents said China, Brazil and India offered investors the best opportunities for making money. The United States, Europe and Japan were seen to have less potential.
Both US and British lawmakers are working to rebuild a web of financial regulations and raise taxes after the credit crisis and recession wiped out trillions of dollars in household wealth and more than 10 million jobs.
Investors said they expected the US administration under President Barack Obama to be more restrained in reining in risk-taking than that of British Prime Minister Gordon Brown.
The quarterly Bloomberg Global Poll of investors and analysts in six continents was conducted between Oct 23 and 27. It was based on interviews with a random sample of 1,452 Bloomberg subscribers, representing decision-makers in markets, finance and economics.
The ascent of Singapore and the decline of London reflect the rise of specialised financial centres that cater to specific segments of the industry.
Many hedge funds have left the British capital because of a new top income tax rate of 50 per cent and regulations planned by the European Union that restrict the amount they can borrow.
Singapore and Shanghai are growing in popularity as firms look for ways to tap the wealth that has accumulated in China and the rest of Asia. Private wealth management, in particular, is growing in Singapore, which has no capital gains tax.
'Everything in Singapore is so well organised. Everything is so efficient. Everything works,' said Mr Gary Addison, a partner at private equity firm Actis Capital. He worked in London, then Tokyo, before moving to Singapore two years ago.
Singapore's investment climate also attracts firms seeking high returns.
Dubai, like China and Singapore, remains a popular regional financial centre for investors who want to take advantage of the oil wealth in the Middle East. The sheikhdom was the preferred locale of 5 per cent of those polled.
Source: Straits Times, 31 Oct 2009