Shanghai ranked sixth in the latest edition of the Global Financial Centers Index published by the City of London, the highest since the index was launched four years ago. This means Shanghai has again ranked among the top-10 financial centers in the international authoritative financial center rankings after the Xinhua-Dow Jones International Financial Centers Development Index.
The changes in Shanghai’s position in the international financial center rankings have revealed the rise of the Lujiazui Financial City along the banks of the Huangpu River. The Lujiazui Finance & Trade Zone, the only financial and trade zone among China’s 185 national-level development zones, has hosted 553 various types of domestic and foreign financial institutions in 190 office buildings over the past five years and has become a core functional area to develop Shanghai into an international financial center.
Framework of Shanghai as an international financial center has been established
The Pudong New Area Financial Map published in December is not only China’s first finance-themed map, but also uses both front and back sides to show detailed information on financial institutions within the Lujiazui Financial City. “There are so many financial institutions here and even dozens of financial institutions within one building that the two-sided map can hardly cover all of them,” said Dong Qin, deputy head of the Financial Services Bureau of Pudong New Area.
Among over 500 financial institutions within the Lujiazui Financial City, there are 96 domestic and foreign banks, including 17 foreign legal-person banks with aggregate assets exceeding 1 trillion yuan. There are also 29 fund management firms that manage about 36 percent of China’s total fund assets, and 11 firms whose businesses involve factor markets of security, futures, diamond, oil, financial futures, property rights, human resources and real estate.
“The appeal of the Lujiazui Financial City is closely associated with the ideas to plan at a high starting point and to make large-scale development during its initial development stage,” Shanghai Lujiazui Group general manager Yang Xiaoming said. The Lujiazui Financial City symbolized by the three super-high-rise towers of the Jin Mao Tower, Shanghai World Financial Center and Shanghai Tower has become Shanghai’s powerful economic growth pole thanks to the concentration of domestic financial institutions, sound factor markets and strong capital accumulation and distribution capacity.
Driven by the Lujiazui Financial City, the number of financial institutions within the Pudong New Area has been on a rapid rise during the “11th Five-year Plan” period. The number of financial institutions under supervision climbed from 361 to 640, an increase of 279 institutions or 77 percent, and that of financial institutions without supervision increased from 94 at the end of the “10th Five-year Plan” period to the current 459. The Lujiazui Financial City has successively made innovations in the financial sector such as the pilot trust registration legislation project, the launch of the credit transfer market and the establishment of the Shanghai Equity Trust Transaction Center.
The more important change is the Lujiazui Financial City’s significantly louder voice in the international financial market compared with five years ago. In 2009, the Shanghai Stock Exchange ranked third among worldwide stock exchanges in terms of trading volume and sixth in terms of the total capitalization of listed companies, and the trading volume of six key commodities including rubber, copper and zinc on the Shanghai Futures Exchange all ranked first across the world.