Johannesburg has fallen from 69 to 83 on the Global Financial Centres Index, a sharp decline in its reputation as a top financial centre. Cape Town’s standing dropped from 73 to 91.
The index is compiled every six months by London-based think tank Z/Yen and the China Development Institute.
The index ranks 121 cities according to surveys of 147 factors, including the state of the local business environment, human capital, infrastructure, financial sector development, and reputation.
South Africa’s standing as a reputable financial hub has taken a big hit after being greylisted by the Financial Action Task Force (FATF).
The FATF is an intergovernmental body that sets global standards to combat money laundering and terrorist financing.
The FATF’s decision signals to global banks, financial institutions, and investors that South Africa is not fully compliant with anti-money laundering and terrorist financing standards.
The move puts South Africa in the company of countries such as Syria, Haiti, Yemen, and Mozambique.
The Johannesburg Stock Exchange (JSE) has also suffered an exodus of key listings, including Mediclinic, PSG, and Distell.
In 2021 alone, it lost 25 listings. This week, major gold producer AngloGold Ashanti moved its primary listing to the New York Stock Exchange.
According to the index, Casablanca (ranked 54th) continues to be the leading African centre. Mauritius (68), Kigali (81), and Nairobi (90) all gained ten or more places in the rankings.
New York remained the world’s top financial centre, followed by London, Singapore, and Hong Kong. Washington, DC, and Geneva replaced Seoul and Boston in the top 10 rankings.