LONDON (Reuters) – Britain’s huge financial services industry will lose more jobs to Europe in the coming years due to Brexit, the City of London political leader told Reuters, warning people not to be fooled by the low rate of job relocations to the continent far.
FILE PHOTO: Catherine McGuinness, Chair of the Policy and Resources Committee of the City of London Corporation, poses for a picture in London, Britain on Jan. 17, 2018. REUTERS / Hannah McKay
Home to global forex, bond and fund management businesses and more banks than any other financial center, the City of London is on the verge of upheaval as companies decide whether to move jobs to continental Europe to continue serving clients after the UK should leave the EU in two weeks.
Catherine McGuinness, the political director of the financial district’s municipal corporation, warned that the country’s largest export sector and source of corporate income tax have no “God-given right” to global financial supremacy.
“The announced job changes are currently quite small. We would expect these to rise, ”said McGuinness in an interview in a room outside the seat of power of the local government in the medieval town hall. “It’s not the end of the story. This is a high risk moment for the city. “
Since the UK voted to leave the European Union three years ago, London’s financial services industry has been shaken by the prospect of ending four decades of regulatory integration and losing access to the bloc in one fell swoop later this year.
McGuinness said business leaders had been frustrated with more than three years of uncertainty and worries about some of the political momentum that lagged behind the no-deal exit.
“We need the government to stop playing around and regulate our long-term future on the basis that will allow us to develop harmonious relationships with our EU partners in the future,” she said.
Britain and the EU will meet at a summit in Brussels on Thursday to agree on a divorce settlement. Failure to do so will ask the UK for an extension or a disorderly departure.
“A disorderly Brexit would be a bad thing, and I don’t think anyone is excited about enlargement. We don’t want cans to be thrown down the street, ”said McGuinness.
Given that global banks are not loyal to anyone, she called on the government to help the city continue to recruit international talent, build decent housing and transportation, and keep banks competitive after the US cut taxes.
When asked if she would prefer Britain to leave the EU without a deal or a socialist government led by opposition leader Jeremy Corbyn, McGuinness said it was a difficult question to answer.
“A destructive exit would be a very bad thing,” she said. “Any color government that only takes into account the overall needs of the entire economy would be a better solution.”
Reporting by Huw Jones and Andrew MacAskill, editing by David Evans