As the UK marked four years of freedom from the stifling grip of Brussels rule in the EU last week a major new report by the Corporation of the City of London revealed how Brexit has helped the UK maintain its position as number 1 in the world for financial services.
According to the report London came top again and maintained its lead over it main rival New York because it has been boosted by Brexit freedoms to deregulate and introduce lighter touch rules.
The revelation is yet another humilation for Remainers who confidently claimed that thousands of jobs would be lost in the City and Paris, Amsterdam or Frankfurt or all three would replace London as Europe’s top financial centre as part of the “project fear” campaign against leaving the EU.
Not only have they been proven wrong, according to the report, but with Brexit London appears to be becoming stronger.
Policy Chairman of the City of London Corporation, Chris Hayward, said: “I am pleased to see London retain its crown as the leading global financial centre after tying with New York City last year, but our competitive edge must be revived. These report findings are a testament to the success of recent regulatory changes which have sparked business optimism by removing barriers to international talent and ease of doing business.”
He went on: “However, further reforms are needed. We cannot ignore the challenges we face in our capital markets ecosystem. Our flagship report, Vision for Economic Growth, outlines a long-term plan for the prosperity of the UK into the next decade – now is the time for the financial services sector to work closely with Government and regulators to realise this roadmap.”
Previously, Hayward has revealed that thousands of extra jobs have arrived in the City since leaving the EU as well as the world’s biggest investments by major financial investors.
The success of the City of London is coupled with other important Brexit victories including the Comprehensive and Progressive Trans Pacific Partnership super £12 trillion trade deal, the Australia and New Zealand deals, and the UK over taking France in manufacturing and growing more than the major EU economies.
Britain has also become Europe’s centre for new e-vehicle production and technology with investments by Jaguar Landrover, Nissan and Ford.
Boris Johnson recently laid out many of the gains in an article including getting the covid vaccine rolled out first.
The Corporation’s report benchmarked the performance of the world’s leading financial centres across 101 metrics including a new metric measuring business infrastructure resilience.
It noted that London “ranked top in both sustainable finance and talent and skills”.
London’s regulatory quality and openness to businesses through the newly introduced Financial Services and Markets Act and the Edinburgh Reforms landed it in the top position with an overall competitiveness score of 59, down from 60 in 2023, while New York decreased its score by 3 points to 57.
None of the European centres were even in the top 3 with Singapore placed third again dropping three points to 48.
The EU’s centres trailed in far behind with Frankfurt sitting fourth with 44 and Paris fifth with 40, despite claims London would lose out to them.
Lord Mayor of the City of London, Professor Michael Mainelli, said: “Amid a range of macroeconomic and geopolitical challenges, this latest report shows how the UK’s financial services are key to driving growth and promoting the breadth of specialist expertise available in the City of London.
“With over 104 unicorns in London alone – many of them in the tech sector – it’s imperative that the UK strives to stake its claim as a tech superpower by maintaining its leadership in AI innovation and regulation and implementing world-leading digital transformation.”
London saw significant gains in regulation and talent and skills with foreign direct investment increasing by 68 percent from 2021 to 2022 to more than £2 billion as asset managers, fintechs and investment banks opened offices in London creating 15,000 jobs.
London is the leader in sustainable finance with UK companies committed to ESG and transition policies and investors allocating to sustainable finance strategies.
London’s office vacancy rates have decreased to 7.3 percent in 2022 while New York’s has grown to 22.2 percent – London’s office prices are also half those of New York.
The UK is the world’s second largest asset management hub with £4.2 trillion managed for overseas clients.
There are 138 unicorns in the UK – startups valued at $1bn – more than France, Germany and Singapore combined.
