THE Isle of Man dropped three places in the Global Financial Centres Index in March.

The Index, which is published twice a year by Z/Yen Group, provides profiles, ratings and rankings for 75 financial centres.

The aim is to examine the major financial centres globally in terms of competitiveness.

The report, published in March, showed the Island was trailing fellow offshore centres Jersey and Guernsey on the list.

Jersey, which slipped one place since the last report, was ranked 23rd, Guernsey was in 27th place and the Isle of Man was 35th, down from 32nd.

The majority of financial centres - 47 - have a lower rating than in the last index while only 25 centres are rated higher.

The then Economic Development Minister, Allan Bell MHK, said: "The index offers an interesting indication of perceptions but perceptions are not necessarily an indication of performance."

He added: "The Isle of Man continues to be recognised across the world as a well-regulated high-quality financial centre offering innovative products and a wide range of business solutions and we remain committed to maintaining this status.

"However in recent years it has actively diversified its economy to ensure continuing prosperity and growth.

"The Island has now established and positioned itself as a true international business centre and become one of the leading environments in the world for e-gaming, aircraft and ship registration, as well as having a high-tech manufacturing sector serving a global blue chip client base.

"It has also established a successful space commerce sector and is increasingly becoming known as one of the most dynamic locations for conducting space-related activities.

"All this has meant we have retained our AAA credit rating in the midst of the world wide economic turmoil, the economy is expected to grow in the region of four to five per cent in the current financial year and current unemployment is around two per cent, highlighting the fact that the Island continues to be successful and attract investment from businesses across a range of sectors.

"This diversification has been facilitated by strong and effective links between government and the private sector as well as offering financial assistance for companies including capital grants."

Update: The Isle of Man lost its AAA credit rating in November. For more on this click here.

This story is part of isleofman.com's Review of the Year 2011.