A lot of fears and predictions have been made in the light of Brexit in all sorts of areas and industries. In the financial sector in London there has been some surprising data recently.
At commercial thinktank and consultancy firm Z/Yen, they have a global financial centres index (GFCI) which ranks 92 financial centres worldwide.
It recently revealed that London’s score fell by only two points this year. People were expecting a much bigger fall due to the uncertainty and precarious economic position the UK is in following the Brexit vote.
The report said: “Interestingly, despite the ongoing Brexit negotiations, London only fell two points, the smallest decline in the top 10. Overall assessments for the European centres continued to fluctuate as people speculate about which might benefit from London leaving the EU.”
London’s main rival New York on the other hand had fallen by 24 points, which makes it the largest fall among the top 15 centres. Z/Yen suggested that this was because of the America’s own concerns “presumably due to fears over US trade” because of Trump’s presidency. Trump has already pulled out of the TTIP trade agreement throwing a lot of uncertainty into the mix for many US businesses.
Z/Yen also revealed that London also came ahead of other rivals like Hong Kong and Singapore.
There has been a great deal of fear that London would lose its place and reputation in the world, particularly in the financial sector. With many companies and banks already moving their workforce overseas, this report has come as a surprise to many.
Relocation of British firms and banks
One of the concerns has been that businesses will up and leave and choose another European base for their business. This could potentially lead to economic strain and instability as well as a huge loss of jobs.
Z/Yen say that Frankfurt has risen in the chart to take the number 11 spot. Dublin has moved up to 30. Both of these cities are currently among the most popular options to battle for any business leaving the UK because of Brexit.
Morgan Stanley has already picked Frankfurt and plans to relocate around 200 members of staff there. Citi said they are also expanding in the same city.
TheCityUk, Britain’s most powerful financial lobby group has called for more clarity regarding Brexit so that companies can plan ahead.
Miles Celic, Chief Executive Officer of TheCityUK said: “Absent this, many firms have already started to activate their contingency plans and others will undoubtedly follow suit if these aren’t confirmed as soon as possible – and by the end of this year at the very latest.”
What do you think of the latest index? Are you concerned about businesses leaving the UK or are you looking to join them? Let us know what you think in the comments below.