Ambitions grow overseas to succeed Wall Street as global finance capital
SHANGHAI — Looking down from his building's 87th floor at the glittering signs of multinational banks along the river here, Fan Dizhao declared confidently that Wall Street's reign as the world's No. 1 financial hub is coming to an end.
The United States is grappling with its worst economic crisis since the Great Depression, but these are go-go days in China.
Venture capital, private equity and foreign direct investment are at all-time highs. Although Shanghai's stock exchange has lost close to two-thirds of its value this year, China's big banks have been largly unscathed by the credit crunch, and the economy continues to expand briskly.
Fan, an investment manager at Guotai Asset Management Co., which oversees funds valued at around $5.1 billion, said that despite the country's inexperience in the financial sector, China had a rare trump card: mountains of cash.
"It is inevitable," he said, "that we will take the U.S.' place as the world leader."
But Shanghai is just one of several cities harboring ambitious -- and to some analysts, fanciful -- aspirations while the global finance industry is reshuffled.
Tokyo has lifted some regulations on banks and insurance groups and has begun to do something it resisted for a long time: print securities documents in English. The Singapore government, which through its massive sovereign wealth funds has increased its private equity and other financial holdings in recent years, has said it is looking to invest in more distressed assets in the United States.
And Dubai, riding the Middle East's oil-fired boom, has declared itself the center of Islamic finance and says it aims, in the words of Dubai's government, to "develop the same stature as New York."
With U.S. investment houses tumbling into bankruptcy, consolidating operations or transforming themselves into more closely regulated commercial banks, Wall Street's reputation as the prime address to raise capital, seek investment advice or trade securities is no longer rock solid.
The flow of capital had already begun moving away from the United States this summer. A survey released last week about the competitiveness of world financial centers found that New York and London, which are often neck-and-neck in such rankings, were still at the top.
