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London retains global finance crown despite Brexit

Kalila Sangster
·3-min read
The Scalpel skyscraper centre.
London came out on top for tech and innovation in financial services, according to a new report. Photo: Getty

London retains the top spot for financial and professional services globally, when compared to other destinations around the world, including financial hubs such as New York, Singapore, Hong Kong and Frankfurt, according to new figures.

London consistently performs strongly across all key dimensions, including innovation, reach of financial activity, resilience and business infrastructure, talent and skills, and regulation, according to the research by the City of London Corporation entitled ‘Our global offer to business: London and the UK’s competitive strengths in a changing world,’ which considers 91 different metrics.

The UK’s capital took the crown with an overall competitiveness score of 62, followed by New York (54) and Singapore (53). The rankings were rounded out with Frankfurt (41), Hong Kong (40) and Tokyo (32).

This is despite Brexit uncertainty as the trade deal secured on Christmas Eve does not include financial or professional services. These sectors are still waiting on more clarity on the future trading relationship with Europe.

UK-based companies’ ability to trade across the EU is reliant on the EU confirming Britain’s financial frameworks are aligned enough with its own rules under its “equivalence” system.

READ MORE: Brexit and COVID-19 pushes UK finance sector to cuts jobs and re-evaluate the need for offices long-term

The EU was the City of London’s biggest customer pre-Brexit.

More than 7,500 jobs and at least £1.2tn ($1.6tn) of assets have been moved from Britain to the EU since the referendum in 2016, according to consultancy EY.

London came out on top for tech and innovation in financial services and is home to most of the Fintech 100 firms, according to the City of London Corporation report.

The UK leads among major economies for its regulatory and legal framework “as it sets international standards,” the report found.

London is Europe’s leading destination for investment in financial services, with net financial services exports in the UK coming in higher than the value of Singapore, Hong Kong, and Germany’s combined in 2019.

London is also home to the ‘greenest’ stock exchange in the world and is a leading centre for sustainable finance. The capital offers the most “future-ready talent pool on sustainability issues,” according to the report.

READ MORE: London property developer offers stamp duty holiday extension for six months

The US holds the title for the most international financial activity, but the UK comes a close second and is the largest centre for international debt issuance, commercial insurance and reinsurance, and foreign exchange trading globally.

However, it is worth noting that the ranking was compiled by the City of London Corporation, the municipal governing body of the City of London, the location of much of the United Kingdom's financial sector — therefore London’s place at the top of the table is perhaps unsurprising.

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