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Jersey's biggest industry has received a glowing report from a global think-tank, ranking it as the world's 40th most competitive finance centre... but its findings have been welcomed with a degree of caution.
The Global Financial Centre Index is a list of 100 jurisdictions compiled every six months by Z/Yen, a City of London consultancy founded by Lord Mayor Michael Mainelli and backed by the China Development Institute (CDI) which has previously provided services to the Channel Islands.
The index was launched as a barometer in the year 2000 to track the competitiveness of finance centres across the world.
Its results are based on thousands of financial centre assessments from an online questionnaire together with more than 100 indices from organisations such as the World Bank, the Organisation for Economic Co-operation and Development and the Economist Intelligence Unit.
But some have queried the questionnaire methodology used, while national press has questioned the think-tank's link with the CDI, whose founder is a controversial figure who has been accused of human rights abuses.
The think-tank said that the island had gained "significant ground" in comparison with the previous report, in which it ranked 52.
Jersey is among the top 15 Western European centres and is ahead of the other Crown Dependencies.
While Jersey rose in the rankings, the Isle of Man (68) and Guernsey (69) slid down by nine and 11 places respectively.
It was, however, behind rival centre Luxembourg (17), it jumped ahead of Cayman (79) and Bermuda (106).
New York was named as the number one finance centre, ahead of London and Singapore.
Jersey Finance, which represents the Island's industry, said that the Global Financial Centres Index ranking is a good sign, but urged caution about interpreting the findings.
Jersey Finance CEO Joe Moynihan said: "The GFCI provides a useful general benchmark, though we are cautious to draw too many firm conclusions from it.
"However, it is positive to note that Jersey has risen significantly in the rankings and has been ranked in the top 15 centres in Western Europe, a particularly encouraging indicator that helps to demonstrate our increasing profile in European markets.
"The rankings also illustrate both how competitive and changeable the environment is and reinforce how important it is to continue to tell our story to give investors certainty and clarity."
Pictured: Jersey Finance CEO Joe Moynihan.
Guernsey Finance CEO Rupert Pleasant also questioned the methodology used by the think tank.
The questionnaire uses respondents' ratings of different financial centres on a scale ranging from very poor to excellent, alongside questions about factors influencing competitiveness.
"It is important to note that rankings will climb one year and drop another," he said.
"If we consider Guernsey's position in last year's ranking, we saw a 12-point increase, reflecting that Guernsey's offering is strong, but also recognising that there is considerable variation across centres' rankings on this particular index and the methodology used by Z/Yen, which relies on surveys and questionnaires to compile its data. "
The report also featured an index of leading FinTech, or financial technology, centres. The island ranked as number 85 in the FinTech rankings — which was up four places from the previous report — but one place behind Guernsey — which is ranked as 84 and had risen 13 places from the previous year.
New York retained its leading position in the FinTech ranking, followed by London, then San Francisco.
Tony Moretta, CEO of Digital Jersey said: "It is good to see Jersey’s overall high positioning and increase in FinTech rankings."
"However, it’s hard to see what data they base their conclusions on beyond mention of ‘questionnaires’."
Meanwhile, Z/Yen has also recently scrutiny in the national press for its links with the China Development Institute, which is a 'platinum sponsor' and whose logo features on the latest rankings report.
Based in Shenzhen, Guangdong, the research institute is chaired by Ye Xiaowen, a former Chinese politician accused of human rights abuses. Reports by The Mail on Sunday revealed concerns over the connection between Z/Yen and Ye, who has been linked to Beijing's repressive measures against Tibetan Buddhism.
In a column, former Conservative Party Leader Iain Duncan-Smith said that CDI's sponsorship of finance report author Z/Yen should be a matter of "genuine concern", going on to note: "MI5 has told British business China's 'covert pressure across the globe' was 'the most game-changing challenge we face'."
He said the revelation of the link between Z/Yen and the CDI may fuel "concerns that Prof Mainelli – figurehead of the Square Mile – is 'naive' and potentially 'unfit' to help the City combat threats from Beijing".
To read the report in full click HERE.
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