The government has neglected the City of London in Brexit negotiations, according to the Lord Mayor of London.
Lord Mayor William Russel, a former investment banker, said he had been disappointed by the government’s approach and that it had “missed the point” of the City of London.
Russell is the 692nd Lord Mayor and acts as ceremonial head of the powerful City of London Corporation – an historic local authority.
It was revealed by City A.M. weeks ago that Square Mile firms were set to lose their current EU access on 1 January, with Brussels not planning on extending their “equivalence” arrangements with European markets.
This means UK financial services firms will have to rely on a patchwork of regulations that are mandated by individual EU countries, making it very difficult for major firms to operate throughout the bloc.
Many firms have already prepared for this possibility, with major banks setting up bases in EU cities such as Frankfurt.
The EU’s decision to not grant equivalence will be a serious blow for the City of London, which wanted a fresh EU-wide deal since the UK exports around £26bn of financial services to the EU annually.
Russell told the Sunday Telegraph that he was disappointed that industries such as fishing, which accounts for a tiny percentage of annual GDP, were the most discussed in negotiations.
The financial services sector makes up around 7 per cent of UK’s GDP annually.
“They probably look at us and say ‘they’re going to be all right’, but I think that they’re missing the point because we’re such a critical part of what we have in the UK,” Russell said.
Shadow chancellor Anneliese Dodds this week hit out at the government for being unable to secure a long-term deal for the UK’s financial services sector post-Brexit.
Dodds said the government should have sorted out this issue long ago and that financial services should have been a part of negotiations in UK-EU trade talks.
A Treasury spokesperson said: “By bolstering the dynamism, openness and competitiveness of the sector, we will ensure the UK moves forward as an attractive and well-regulated market, leading the world in pioneering new technologies and shifting finance towards a net zero future.”