(MENAFN- Gulf Times) For the City of London, achieving Brexit terms with the EU that ensure its viability and sustainability is of vital importance. In his response to UK Prime Minister Theresa May's speech on Tuesday in which she outlined the key Brexit objectives for the UK, the City of London Corp's policy chairman, Mark Boleat, said: 'The Prime Minister's speech today added a degree of clarity for the government's Brexit strategy.
He welcomed the Prime Minister's 'ambition to retain the greatest possible access to the single market, which is important to the UK's financial and professional services industries.
The City of London, with its 392,400-strong workforce, is recognised world-wide as a great financial engine. It handles $2.7tn of foreign exchange turnover each day, representing some 41% of global foreign exchange. The 529 foreign companies listed in London represent 20% of the global foreign equity listings. The City is home to 251 foreign banks and is the leading western centre for Islamic finance, with 22 banks supplying Islamic financial services, five of which are fully Sharia compliant.
Over 18% of cross-border lending is arranged in the UK and The City accounted for $330bn of worldwide premium insurance income in the UK in 2013.
Commenting on passporting rights, Boleat said: 'Passporting rights and access to leading talent — facilitated by the single market — has, in part, helped make Britain the world's leading financial centre, but the government fully recognises that protecting these vital industries is a priority.
Within the EU, banks and other financial companies can be authorised to do business in one member state of the EU, or the slightly wider European Economic Area (EEA), and trade across the region without having to be separately authorised in each country.
The EEA is a grouping made up of the EU, plus Norway, Iceland and Liechtenstein who have access to the EU's single market.
A bank using this system can provide services by offering them from its home base to a customer in another country, or it can establish a branch abroad.
It is widely used by financial firms (not just banks) in the EU. It is also used by companies from outside the EEA, such as Switzerland and the US.
Many financial firms operate out of London as the continent's dominant financial centre, and use the UK as their headquarters for selling services across the single market.
On trade partnerships, Boleat observed: 'Trade between the UK and the European Union has helped make our country prosperous. We welcome that government recognises the value and importance of EU companies seeking access to the services of the City of London. 'We also welcome the decision to trade more with existing and new international partners — this has the potential to be the prized trophy of the UK's decision to leave the EU.
He took a strong line on the question of transitional arrangements, stating: 'The City has been vocal on the need for a transitional arrangement from the time Britain formally leaves the EU and when the new arrangements come into effect. Following today's announcement, this becomes an even greater necessity. We would like to see a transitional agreement announced as soon as possible.
'Government's phased implementation plan must avoid a cliff-edge and will be beneficial for firms across all sectors, especially financial and professional services firms. The government must stick to this commitment.
Finally, on the matter of access to talent, he said: 'Britain has long been a magnet for global talent. To continue the sector's success, with 12% of City workers made up of European staff, it is important the flow of leading talent to the UK continues. We support the wish to maintain the rights of EU citizens currently working in the UK.
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