Uncertainty of Brexit: Puts the Top Financial Center at Risk
Trading relations between Britain and European Union is still uncertain, which poses risk to London being the world’s top financial center based on the business survey on Monday.
There was a slowed growth in the financial sector based on the quarterly survey from business lobby CBI and consultants PwC for the three succeeding quarters in the last three months of the year. For two year, the flat trend or a decline phase has been prominent in the period of two years, although, the general transaction was steady as a whole.
Majority of the businesses are looking for certainty in Britain regarding its trade relations in the future, based on the survey done. A CBI Chief Economist, Rain Newton-Smith, said that clarity is needed to gain back business confidence which would dictate on the good opportunities against the bad ones as “consequences of failure”.
On Monday, it is anticipated for the European Union to approve criteria on negotiations as a transition period of Brexit until March 2019 that includes new trading rules.
The head of financial services at PwC, Andrew Kail, said that the transition period will probably take place but the financial sector needs to prepare to function outside the bloc.
They needed to have a counter measure to sustain its trading status and business model.
Other cities such as Luxembourg, Paris, and Frankfurt Dublin are attempting to gain financial services from London to proceed with their transactions with EU customers after Brexit. Paris could surpass London as the leading financial center in few years time, according to the French Finance Minister, Bruno Le Maire, a statement on Reuters.
Gains from financial companies proceeds to grow in the final quarter of 2017, which is also anticipated to be similar the first three months of the year, based on the recent survey.
When it comes to the workforce, eighteen percent comes from the eurozone, which increased from 8 percent ten years ago. The municipal officials for the capital’s “Square Mile” financial district, a report says that almost one for every five workers in 2016 was from a European country, which has been the highest figure recorded so far. Meanwhile, around 59 percent of employees came from outside of Europe.
Another survey shows 54 percent out of 02 companies wanted to make it simpler to attract more workers for Britain’s financial technology or fintech sector.