Brexit ‘uncertainty’ to hurt UK financial industry: TheCityUK lobby group

An EU flag and a Union flag held by a demonstrator during anti-Brexit protests near Elizabeth Tower (Big Ben) and the Houses of Parliament, March 25, 2017. (Photo by AFP)

Britain’s pending exit from the European Union and the “high levels of uncertainty” surrounding it might take away the country’s leading position as a financial hub, a top lobbying firm has warned.

TheCityUK lobby group published a blueprint in coordination with PricewaterhouseCoopers (PwC) on Thursday, saying that their guidelines retain its financial prowess in a post-Brexit Europe.

“Brexit has created high levels of uncertainty and the UK's leading position is being tested and challenged as other international centers develop rapidly,” said Head of Financial Services at PwC Andrew Kail.

The so-called “roadmap to change” included a series of regulatory, industrial, and governmental changes that it said would guarantee economic growth despite the unknown future that awaits the British economy.

Researchers behind the report promised a 9 percent (£16 billion) increase in the UK financial industry’s gross value by 2025 if the changes were successfully implemented.

Around three-quarters of the increase would be out of London, the report added. It further noted that the growth would eventually lead to £43 billion in additional gross domestic product for the UK economy.

The trust issue

To achieve the long-term goal, the report put emphasis on the importance of "rebuilding trust" in the financial sector through more ethical and consumer-centric policies.

“The financial services sector is among the least trusted industries in the UK and has struggled to repair trust after the financial crisis,” the report noted.

“Past scandals and poor engagement” were the other factors that, according to the report, had taken away people’s trust.

British Prime Minister Theresa May (Photo by AFP)

While the report admits that the future might not bring what London has been hoping for, it still remained optimistic about the possibility of an optimal Brexit deal with the EU.

This is while in reality, the government of Prime Minister Theresa May has been pushing for a “good deal or no deal” scenario, raising the alarms about a possible “hard Brexit.”

Experts have warned that a hard Brexit, which among other things means losing access to the EU Single Market, would slash the UK financial industry’s revenue by £38 billion.

Facing strong opposition in parliament after a miscalculated call for snap general election, May has been struggling to keep up with her own Brexit plans.

Despite pledging a strong showing in the EU talks, the UK began the marathon negotiations last month by giving in to the bloc’s demands on how the talks should be held.