TheCityUK: London Slips In Rankings Due to Brexit
The Z/YEN Global Financial Centres Index (GFCI 24) released today found New York overtaking London to take the index top spot for first time since March 2015.
Miles Celic, Chief Executive Officer, TheCityUK, said:
“In a competitive world we cannot afford complacency. London and New York have long vied for the top spot of this index and the uncertainty around the future shape of Brexit is likely to be factor in their latest switch in positions.”
“Most notable in this latest version of the GFCI is the continuing steady rise of the Asian centres. Hong Kong is now just three points behind London for the first time. Singapore, Shanghai and Tokyo are close behind. Given the fall in a number of North American centres as well, it is Asia, not Europe, where the challenge to London and the UK will come from in the years ahead.
“While a couple of the European centres might have had ‘Brexit bump’, there are now fewer European centres in the top 50 as a whole. Despite concerted efforts to attract business, Paris rose just one place to 23rd and cities such as Dublin, Munich, Copenhagen and Stockholm have actually lost ground to global competitors.
“Ultimately these rankings are all about perception. The world is watching to see if the UK and the EU can overcome the political hurdles around Brexit and secure a deal that makes economic sense. It is vital that policymakers focus on this to ensure that Europe remains an attractive and competitive place to do business.”
Regulators need new tools as financial market activity moves from London to EU27.
EU counterparties have to wait until closer to exit date to novate contracts.
As market infrastructure is sticky, trading will stay in London -- at least for now.
Under a no-deal Brexit, no new UK-related data will be received and processed by ESMA.
The deals come into force if the UK leaves the EU without a withdrawal agreement.