This paper examines the roles of Shanghai, Beijing and Hong Kong as financial centres by utilising interview and secondary data to analyse the decision-making of financial and regulatory actors, and the different functional roles of foreign banks in those cities. Their intercity relations demonstrate a complex mix of competition and collaboration that embeds them in evolving networks of interdependence. Empirical findings indicate differentiated markets leading to the distinctive development of Shanghai as a commercial centre, Beijing as a political centre and Hong Kong as an offshore financial centre, with all three financial centres performing distinctive and complementary roles within the regional banking strategies of foreign banks. The analysis first explains Hong Kong’s continued dominance in the region and, secondly, reveals insights into changing intercity relationships between these prominent Chinese cities that contribute to their distinctive development as financial centres.
Get full access to this article
View all access options for this article.
References
1.
AldersonA.BeckfieldJ. (2004) Power and position in the world city system, American Journal of Sociology, 109, pp. 811–851.
2.
AldersonA.BeckfieldJ. (2007) Globalization and the world city system: preliminary results from a longitudinal data set, in: TaylorP.DerudderB.SaeyP.WitloxF. (Eds) Cities in Globalization: Practices, Policies and Theories, pp. 21–36. London: Routledge.
3.
AldersonA.BeckfieldJ.Sprague-JonesJ. (2010) Intercity relations and globalisation: the evolution of the global urban hierarchy, 1981–2007, Urban Studies, 47, pp. 1899–1923.
4.
AllenF.QianJ.QianM. (2005) Law, finance and economic growth in China, Journal of Financial Economics, 77, pp. 57–116.
5.
BassensD.DerudderB.WitloxF. (2009) Searching for the Mecca of finance: Islamic financial services and the world city network, Area, 42, pp. 35–46.
6.
BassensD.DerudderB.WitloxF. (2011) Setting Shari’a standards: on the role, power and spatialities of interlocking Shari’a boards in Islamic financial services, Geoforum, 42(1), pp. 94–103.
7.
BeaverstockJ. (2006) Connecting world cities: organizational labour mobility in transnational banking, in: KoetoekA.van der HammenJ.VelemaT.VerbertM. (Eds) Cities and Globalization, pp. 34–53. Utrecht: Nederlandse Geografische Studies.
8.
BeaverstockJ. (2007) World city networks ‘from below’: international mobility and inter-city relations in the global investment banking industry, in: TaylorP.DerudderB.SaeyP.WitloxF. (Eds) Cities in Globalization: Practices, Policies and Theories, pp. 52–71. London: Routledge.
9.
BeaverstockJ.DoelM.HubbardP.TaylorP. (2002) Attending to the world: competition, co-operation and connectivity in the world city network, Global Networks, 2, pp. 111–132.
10.
BeaverstockJ.HoylerM.PainK.TaylorP. (2001) Comparing London and Frankfurt as world cities. Anglo-German Foundation for the Study of Industrial Society, London.
11.
BeaverstockJ.HoylerM.PainK.TaylorP. (2005) Demystifying the Euro in European financial centre relations: London and Frankfurt, 2000–2001, Journal of Contemporary European Studies, 13, pp. 143–157.
12.
BeaverstockJ.SmithR.TaylorP. (2000) World city network: a metageography?, Annals of the Association of American Geographers, 90, pp. 123–134.
13.
BeckfieldJ.AldersonA. (2006) Reply: whither the parallel paths? The future of scholarship on the world city system, American Journal of Sociology, 112, pp. 895–904.
14.
BergerA.HasanI.ZhouM. (2009) Bank ownership and efficiency in China: what will happen in the world’s largest nation?, Journal of Banking and Finance, 33, pp. 113–130.
15.
CaiJ.SitV. (2003) Measuring world city formation: the case of Shanghai, The Annals of Regional Science, 37, pp. 435–446.
ChuY. (2008) Deconstructing the global city: unravelling the linkages that underlie Hong Kong’s world city status, Urban Studies, 45, pp. 1625–1646.
23.
CrangM. (1997) Analysing qualitative materials, in: FlowerdewR.MartinR. (Eds) Methods in Human Geography: A Guide for Students Doing a Research Project, pp. 183–196. Harlow: Longman.
24.
DanielsP. (1993) Services Industries in the World Economy. Oxford: Blackwell.
25.
DerudderB. (2008) Mapping global urban networks: a decade of empirical world cities research, Geography Compass, 2, pp. 559–574.
26.
DickenP.KellyP.OldsK.YeungH. (2001) Chains and networks, territories and scales: towards an analytical framework for the global economy, Global Networks, 1, pp. 89–112.
27.
DurfeeD. (2009) As Shanghai rises, Hong Kong asks ‘What’s next?’. Reuters, Hong Kong, 10December.
28.
The Economist (2002) Rivals more than ever: which city, Hong Kong or Shanghai, will prosper most in the new century?, 30March.
29.
EnrightM.ScottE.DodwellD. (1997) The Hong Kong Advantage. Hong Kong: Oxford University Press.
30.
FaulconbridgeJ. (2004) London and Frankfurt in Europe’s evolving financial centre network, Area, 36, pp. 235–244.
31.
FergusonM.McGuinessP. (2004) Chinese securities reform: the role of QFIIs in the corporate governance process, Business Horizons, 47, pp. 53–61.
32.
FriedmannJ. (1986) The world city hypothesis, Development and Change, 17, pp. 69–83.
33.
FriedmannJ.WolffG. (1982) World city formation: an agenda for research and action, International Journal of Urban and Regional Research, 6, pp. 309–343.
34.
GrahamS. (1999) Global grids of glass: on global cities, telecommunications and planetary urban networks, Urban Studies, 36, pp. 929–949.
35.
GrahamS. (Ed.) (2004) The Cybercities Reader. London: Routledge.
36.
GreenS. (2004) The Development of China’s Stockmarket, 1984–2002: Equity Politics and Market Institutions. London: RoutledgeCurzon.
37.
HertzE. (1998) The Trading Crowd: An Ethnography of the Shanghai Stock Market. Cambridge: Cambridge University Press.
HuangY. (2001) China’s Last Steps across the River. Canberra: Asia Pacific Press.
40.
HughesA. (2007) Geographies of exchange and circulation: flows and networks of knowledgeable capitalism, Progress in Human Geography, 31, pp. 527–535.
41.
JonesA. (2008) Beyond embeddedness: economic practices and the invisible dimensions of transnational business activity, Progress in Human Geography, 32, pp. 71–88.
42.
KarremanB.KnappB. van der (2009) The financial centres of Shanghai and Hong Kong: competition or complementarity?, Environment and Planning A, 41, pp. 563–580.
43.
KnoxP.TaylorP. (Eds) (1995) World Cities in a World-system. Cambridge: Cambridge University Press.
44.
LaiK. (2009) New spatial logics in global cities research, Geography Compass, 3, pp. 997–1012.
45.
LiD. (1995) Enter the dragon: Hong Kong’s growing role in world finance, The Columbia Journal of World Business, 30, pp. 35–40.
46.
MeyerD. (2002) Hong Kong: global capital exchange, in: SassenS. (Ed.) Global Networks, Linked Cities, pp. 249–272. New York: Routledge.
47.
MeyerD. (2009) Hong Kong’s transformation as a financial centre, in: SchenkC. (Ed.) Hong Kong SAR’s Monetary and Exchange Rate Challenges: Historical Perspectives, pp. 161–188. Basingstoke: Palgrave Macmillan.
48.
NgI. (2000) A clash of two cities, TIME, 11December.
49.
PainK. (2008) Examining ‘core–periphery’ relationships in a global city-region: the case of London and South East England, Regional Studies, 42, pp. 1161–1172.
ShiY.HamnettC. (2002) The potential and prospect for global cities in China, Geoforum, 33, pp. 121–135.
61.
SmithD.TimberlakeM. (2001) World city networks and hierarchies, 1977–1997: an empirical analysis of global air travel links, American Behavioral Scientist, 44, pp. 1656–1678.
62.
SmithD.TimberlakeM. (2002) Hierarchies of dominance among world cities: a network approach, in: SassenS. (Ed.) Global Networks, Linked Cities, pp. 117–141. New York: Routledge.
63.
The Standard (2009) Shanghai’s 2020 vision is ‘alarming’ news for SAR, 31August.
64.
State Council (2006) Regulations on the administration of foreign-funded banks. China Banking Regulatory Commission, 11November.
65.
StraussA.CorbinJ. (1990) Basics of Qualitative Research: Techniques and Procedures for Developing Grounded Theory. London: Sage.
66.
TaylorM. (1997a) Hong Kong’s economy and its global connections: prospects for 1997 and beyond, in: BrownJ.FootR. (Eds) Hong Kong’s Transitions, 1842–1997, pp. 166–191. London: Macmillan.
67.
TaylorP. (1997b) Hierarchical tendencies amongst world cities: a global research proposal, Cities, 14, pp. 323–332.
68.
TaylorP. (2004) World City Network: A Global Urban Analysis. London: Routledge.
69.
TaylorP. (2006a) Comment: parallel paths to understanding global intercity relations, American Journal of Sociology, 112, pp. 881–894.
70.
TaylorP. (2006b) Shanghai, Hong Kong, Taipei and Beijing within the world city network: positions, trends and prospects. GaWC Research Bulletin No. 204 (http://www.lboro.ac.uk/gawc/rb/rb204.html; accessed 21 March 2011).
71.
TaylorP.DerudderB.GarciaC.WitloxF. (2009) From north–south to ‘global’ south? An investigation of a changing ‘south’ using airline flows between cities, Geography Compass, 3, pp. 836–855.
72.
ThriftN. (1987) The fixers? The urban geography of international commercial capital, in: HendersonJ.CastellsM. (Eds) Restructuring and Territorial Development, pp. 203–233. Beverly Hills, CA: Sage.
73.
TIME (2000) One door is not enough, 11December.
74.
WalterC.HowieF. (2003) Privatising China: The Stock Markets and Their Role in Corporate Reforms. Singapore: John Wiley & Sons.
75.
WasserstromJ. (2009) Global Shanghai, 1850–2010: A History in Fragments. New York: Routledge.
