Port Cities and Trading Networks in China, Japan and Southeast Asia, 13th–21st Century
Chapter 16: Hong Kong, Shanghai, or Peking: Where Will China’s International Financial Centre be Located?
A financial centre is a market where large concentrations of financial capital are assembled, swapped, debited, or exchanged. It is usually a city where ‘for historical, cultural, regulatory, or fiscal reasons . . . there is a concentration of market players (such as banks, insurance companies, management companies, brokers etc.) which enter into multiple relationships between themselves, with no direct connection to their locality, and conduct operations in various primary and secondary financial markets. Then there are other enterprises (such as information technology providers, credit assessment agencies, advisory services, training centres etc.), which are organised around these direct market players.1 Every financial market draws on a wide range of professional expertise, and involves the free co-operation between players with specific and clearly-defined areas of competence who bring high levels of added value. Only by collaborating in an international financial centre are they able to achieve enormous surpluses without making any tangible investments. For example, it is estimated that in 1999, 7 per cent of Britain’s GDP was earned by the million employees working in the square mile of the City of London,2 while the French financial sector’s 700,000 employees are responsible for 4.5 per cent of national GDP – twice the size of the automobile industry.3 It must be said that people in charge of these operations often seek face-to-face meetings, and also that the main stock exchanges and financial markets are ports which enjoy a reputation as ‘open cities’. It is clear that despite the dematerialisation of the processes of production,...
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