2025
Ibon Gil de San Vicente
Basque Institute of Competitiveness - Deusto Foundation
Abstract
Europe is facing industrial restructuring amid geopolitical tensions, ecological transition and financial concentration. This process poses particular challenges for its peripheral industrialised regions. The Basque Country, as one such region, faces the challenge of strengthening its financial centre so that it can serve as a catalyst for these industrial transformations.
This thesis analyses the role of local financial centres in peripheral industrialised regions, taking the Basque Country as a case study. Although these centres are essential for financing the real economy, they have lost capacity due to the centralisation of activity in global financial centres, financialisation and the process of banking restructuring. The study shows that the territory remains a key factor in access to finance, especially for companies with unconventional needs such as industrial companies.
The weakening of local financial centres has structural consequences for long-term investment, innovation and territorial cohesion. The research proposes a financial architecture based on proximity, diversity of actors and strategic collaboration, and highlights the need to align industrial and financial policies with local realities.
The capabilities of the local financial centre in the Basque Country are analysed, identifying both its weaknesses — such as its poor connection with other financial centres and low institutional innovation — and promising opportunities, including the consolidation of locally based investors and the existence of proprietary instruments and active public-private collaboration.
The study concludes that strengthening the local financial centre is key to advancing industrial transformation and balanced economic development. To this end, strategies are proposed to strengthen the local financial centre by offering a variety of solutions, fostering connections with the region and other financial centres, promoting shared governance, and using its activity to drive industrial policies.
Keywords: Local financial centers; business financing; industrial regions; financialization
