Restarting Economic Growth: Where Asian Economies, IFCs Combine

Elise Donovan, 21 October 2020


The author of this article argues that as Asia and the rest of the world begin to rebuild their economies, the role IFCs play will continue to be of great importance.

The way in which Asia’s economies, and the international financial centres they interact with, are able to re-start global growth and help other economies recover from the ravages of COVID-19, is an important topic. Learning from Asia’s experience of handling SARS and other outbreaks, and the region's rapid growth prior to the pandemic, will be crucial to our understanding of how quickly global progress can happen.

The role of IFCs in channelling funds to those who are able to invest in them for the strongest returns is also important - and often not given enough credit in the court of wider public opinion. IFCs can remove certain frictional costs, foster cross-border investment, and are hubs of experts. One such IFC is the British Virgin Islands which, along with some of its peers, is keen to tell its story to Asia, an important source of clients. 

To discuss these themes is Elise Donovan, chief executive of BVI Finance. (More details on the author below.) The editors are pleased to share these views; this publication does not necessarily endorse all views of guest writers. Email the editors at and

The pandemic has had a profound effect on the world economy with major markets coming to a near standstill. COVID-19 has disrupted global investment and moved the world towards de-globalisation. It has changed the way we work and businesses’ ability to trade. It has also accelerated underlying market trends such as the shift to remote working and digital transactions. 

Around the world, countries are facing a new battle to avoid a deep recession, coupled with rising concerns over the likelihood of a second wave of infections and further lockdowns. There is heated debate as to what approaches global economies should take, what recovery will look like and how long this will take. 

Against this backdrop, Asian economies such as China, Hong Kong, Japan and Singapore, are showing the way towards stimulating a return to global economic growth. According to the most recent Global Financial Centres Index, these four Asian international financial centres were ranked in the top six globally, following New York and London, strengthening their position as stable centres during a year of unprecedented financial-market volatility and uncertainty. In fact, according to a recent report by the BBC, Hong Kong's status as a premier Asian financial hub is expected to remain intact in spite of this uncertainty. The report referenced the $11 billion raised on the Hong Kong stock exchange from 59 new listings in the first half of 2020. This is likely to increase with the forthcoming debut of the Hong Kong flotation of the Chinese financial technology company Ant, which is expected to raise more than $30 billion and be the largest stock market debut this year. Clearly this is evidence of the continued attraction of Hong Kong as a hub for global capital markets, investment and finance. 

Other Asian economies such as Japan are looking at new ways to bounce back, with Prime Minister Yoshihide Suga recently telling the financial news outlet Nikkei that his government will consider lowering tax rates and promoting diversity in boardrooms to attract foreign talent in an effort to reinvent Tokyo as a global financial hub.

As the first economy to be affected by COVID-19, China was also the first to emerge from the turmoil of the pandemic, and its economic recovery is gaining momentum. The majority of businesses are now open, manufacturing has largely resumed to pre-COVID-19 levels of production, and domestic consumption is picking up once more. In fact, several economists have upgraded their forecasts for China and are expecting it to be the only major economy to grow this year. In this way, China has provided a blueprint for the return to economic growth for not only other Asian economies, but also globally.

The Asian economic bounce back should be a sign for governments around the world that in spite of the current uncertainty, their own economic activity will eventually return. As we all seek to minimise risk and manage any further outbreaks, there is growing realisation that this is the “new normal” and that we must prepare to operate in a landscape of continued uncertainty.

This is where the role of international finance centres comes in. While IFCs vary in size, areas of expertise, geographical coverage and the services they offer, they are ultimately renowned for providing a resilient and trusted platform for business establishment, growth and diversification – areas that are crucial in order to stimulate global economies and facilitate their recovery.

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