Karen P. Y. Lai

Differentiated Markets: Shanghai, Beijing and Hong Kong in China’s Financial Centre Network

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.

Integrating Finance into Global Production Networks

Coe N. M., Lai K. P. Y. and Wójcik D. Integrating finance into global production networks, Regional Studies. While successful in its aim of ‘globalizing’ regional development, the global production network (GPN) approach has thus far paid less attention to the role of finance in the dynamics of the global economy and regional development. This lacuna is significant as finance is arguably even more globalized and networked than production. To address this gap the paper distils the concept of the global financial network (GFN) from financial geography and related scholarship, with advanced business services, world cities and offshore jurisdictions at the core. Interactions between the GPN and the GFN are discussed, focusing on the financing and financializing of GPNs and the co-evolution of globalization and financialization. Integrating finance into GPN research entails more than a simple extension of the approach; it would also enrich it conceptually, and enable it methodologically and empirically.

Editorial Introduction to the Special Section: Deconstructing Offshore Finance

abstract Recent scandals involving large corporations including Amazon, Apple, Google, Starbucks, and HSBC have highlighted the problems of tax avoidance, evasion, and offshore financial activities. Considering their significance to growing inequality and financial instability, renewed media and public attention is well justified, and new research on these topics urgent. At the same time, however, there is confusion in the very use of the term offshore finance. Some apply it interchangeably with tax havens; others go as far as to use it as a synonym of international finance. We argue that offshore finance needs a precise definition and careful positioning in a broader economic geographical framework. We suggest a definition based on the legal and accounting, in addition to financial, aspects of offshore finance, and we propose the concept of global financial networks to situate offshore jurisdictions and offshore finance in the firm–territory nexus and in relation to global production networks. This sets the stage for the three research articles presented in this issue, which map offshore financial networks at global and regional scales, and investigate their causes and mechanisms.

The Lehman Minibonds Crisis and Financialisation of Investor Subjects in Singapore

Using the case of the Lehman Minibonds crisis in Singapore, this paper aims to elucidate processes of financialisation and geographies of investor subjects by investigating the reshaping of retail banking consumers into investor subjects. Instead of painting all investor subjects with a broad brush as part of a generic financialisation process, the Minibonds crisis demonstrates how the consumption of financial products is geographically specific and moderated by local factors, such that financial subjects are incorporated unevenly into global financial markets. Greater geographical sensitivity is therefore needed to tease out how distinctive groupings or ecologies of financial knowledge, practices and subjectivities emerge in different places with uneven connectivity and unequal material outcomes. The paper concludes by discussing the incomplete and contingent nature of subject formation and implications for understanding neoliberal subjectivities.

Conceptualizing Islamic banking and finance: a comparison of its development and governance in Malaysia and Singapore

ABSTRACT In response to the limited engagement with critical social science concerning the governance of Islamic banking and finance (IBF), this paper compares and conceptualizes the development and governance of IBF in Malaysia and Singapore. We argue that IBF governance in Malaysia and Singapore can be distinguished on the basis of ethnic politics, moral suasion, product demand, product innovation, and the character of state practices. Concerning the latter, we contend that the political economy of both countries can be characterized as broadly involving a ‘neoliberal-developmentalism’, but we nuance this by positing a transition in Malaysia from a ‘semi-developmentalism’ in the 1980s to what we call an ‘Islamic and internationalising ordoliberalism’ beginning in the 2000s. In turn, the governance of IBF in Singapore involves a combination of neoliberal developmentalism, which nonetheless also entails some form of Islamic ordoliberalism.

Review of world city network

This second edition contains a refreshing engagement with some key criticisms of the World city network (WCN) analysis. The first strand of criticism came from Robinson’s (2002, 2005) postcolonial critiques in terms of how the WCN analysis appears to privilege Anglo-American centres, and argues for moving beyond finance and advanced producer services (APS) since those only represent one dimension of cities in globalisation. The second critique came from Therborn (2011) regarding inadequate theorisation of the state, as city–state relations are dynamic and often reconfigured in response to changing economic conditions, technological breakthroughs, geopolitics and regime changes and shifts in consumer markets. The shift in emphasis from national states to cities and municipal governments appears to gloss over complex city–state relations. While the authors offered some responses in the earlier section of the book, there is a missed opportunity to tie in more explicitly the interlocking network model (INM) in the middle section in order to explain how this could extend, affirm or challenge ideas of urban systems and global economic change. For instance, how do the empirical cases of non-governmental organisations, maritime services and media firms address the above criticisms? This is important to the book’s key argument that the INM is amenable to wider analyses of global city-making and processes of global connectivity beyond APS. The final section reflects on this to a certain extent, but the response to Robinson’s and Therborn’s critiques could be much tighter to demonstrate the relevance and value of the WCN approach to other actors, criteria and forms of analyses for contemporary urban studies. APS firms, alongside finance, are not just intermediaries but powerful actors in their own right in the construction and maintenance of WCNs. If we are to take a forwardlooking view of dynamic WCNs, other sectors are becoming increasingly vital in reshaping networks across cities and regions as global business processes evolve. Data management, security and IT solutions are increasingly vital, but so far these have been lumped together with routinised services and remote access functions in midand back-office activities. In practice, these often require frequent and close client interaction, establishing trust and creating customised solutions. The demands of data management, infrastructure and analysis could therefore be creating multi-layered networks