The success of the Square Mile is of paramount interest to the European Union and the Eurozone, chancellor George Osborne told peers yesterday.
“The health of the City is an EU and Eurozone interest,” Osborne told the Lords Economic Affairs Committee.
But responding to a question from Lord Kerr of Kinlochard, Osborne also said that European Union regulation often made it difficult for London to compete as a global financial centre.
“There is a frustration that some of the requirements to run a globally competitive wholesale financial services centre are not always understood in all parts of the European Union,” he said, adding that if the City lost its global status, another EU capital was unlikely to take its place.
“If this financial centre was not in London, it would not be in Frankfurt or Paris,” Osborne told the Lords. “It would either be in Zurich or it would be in New York or in Singapore.”
Earlier this week, Osborne told City A.M. that the government would put the City’s interests at the forefront of its bid to renegotiate Britain’s relationship with the EU, saying:
“One of the greatest threats to the City’s competitiveness comes from misguided European legislation. A central demand in our renegotiation will be that Europe reins in costly and damaging regulation.”
Yesterday the chancellor said that pro-Europeans should also want a better deal. “You can be a very ardent europhile and still think this is incredibly important for the UK,” he said.