London as a Finance Hub

London as a Finance Hub

The City of London is often spoken of as a financial ‘hub’. Indeed a September 2015 study by analysts at corporate risk think tank the Z/Yen Group not only ranked London as the world’s leading financial centre, but also ranked the UK capital as top of the league in all of the individual categories in its survey: the best business environment, the most developed financial centre, the most impressive infrastructure, the best human capital and the top overall reputation.

The following are all said to be reasons as to why London is a great place to work in finance:

  • The stability of the uk economy
  • The pro-business policies of the uk government
  • The breadth of financial activities carried out in the city
  • The availability of highly skilled staff from across the world due to a liberal immigration policy
  • A trusted legal system
  • The english language is the accepted ‘lingua franca’ of international finance
  • London is in a time zone allowing it to deal with most major world economies at some stage during the working day, so as the asian economies grew, the status of London grew at the expense of New York, for example
  • Top quality lawyers, accountants and consultants are available to support the financial sector in the city

There is even a historic reason for London’s advantage over other European cities, in that it was one of the Western European capitals that was least damaged by the Second World War bombings.

Companies based in Asia, North America and other regions of the world are more likely to choose the UK for their European headquarters than Germany, France, Switzerland or any other major European economy.

According to TheCityUK, which lobbies for the interests of City-based companies, the UK economy is massively dependent on the financial sector, which employs 7% of the nation’s workforce and provides 11.8% of the UK’s economic output.

There are also signs that London could still thrive as a finance hub following the vote by the UK electorate to leave the European Union (EU). The UK is likely to remain a low tax economy, the general pro-business stance of the UK Government is likely to continue and the advantages of being a country that speaks English will continue to be felt.

Concerns had also been expressed about the EU trying to stifle the City via excessive regulation, and also that future EU financial policy may be more driven by the interests of the 19 Eurozone countries than those of the UK and other countries that have kept their currencies.

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