Fresh perspectives on fostering global financial resilience
Building stronger economies in the wake of the global financial crisis has become a priority for governments and policymakers. The EU-funded LUSIFUNDS (Securities markets, international financial centres, and regional resilience. A comparative analysis of Luxembourg and Singapore as strategic nodes in investment funds’ global production networks) project aimed to support this drive through a cross-analysis of two nations on different sides of the globe. Focusing on Luxembourg and Singapore in its study, the project examined the two nations’ specialised financial centres and their strategies to build resilient financial economies. As the finance sector has become an industry in itself that influences economic growth, the team looked closely at how the very specialised international financial centres operate. It particularly focused on the current ‘securitised’ financial system and asset management industry, examining onsite inter-firm and firm-regulatory relationships to unravel ‘the global’ financial situation. Critically, the comparative study between two specialised investment fund centres (one which represents the EU and the other which represents the ASEAN region) looked at how each builds local resilience. Project work involved studying the applicability of the framework of the global production network to finance, in addition to strengthening the understanding of finance in different ways. It helped explain the increasingly concentrated geography of financial production and explored how regional development strategies of financial centres rely on financial industries to foster economic growth (‘finance-led’ development). Among the project’s most notable outcomes is LUSIFUNDS’ proposal for an accurate definition of the term ‘financial centre’. It also highlighted the need to outline the role of the state in building the financial centre of the future and a more socially productive financial industry. These conclusions and results can be useful for policymakers and for financial centres, helping to push for a healthier and more resilient financial model on a global level.
Keywords
Financial centres, economic resilience, financial crisis, LUSIFUNDS, asset management
