Partnering with the City of London Corporation, we developed the ‘Vision for Economic Growth — a roadmap to prosperity’ report, which sets out a growth plan to help the UK’s financial and professional services firms continue to drive jobs and prosperity.
It can be easy to take the UK’s financial centre for granted, or even criticise its influence, as many did in the wake of the global financial crisis of 2007-2009. But if we hope to revive Britain’s growth rate, extend prosperity across the country, and build a sustainable economy that will deliver for future generations, we need to celebrate our financial centre and empower it to play a leading role in meeting the biggest challenges of our time.
The UK financial centre embodies so many of the qualities that make Britain great. It is a magnet for the best and the brightest talents in a wide variety of professions, from banking and insurance to asset management, consulting, the law, and accounting. The density of these skills in and around the City of London make it an attractive place to do business and facilitate easy collaboration with policymakers, business leaders, and civil society representatives.
The UK has a truly global financial centre. Its openness, legal and business traditions, time zone, and global connectivity make the UK a place where the world comes to do business. The UK is home to the largest share of international bank lending and borrowing, and the largest centre for foreign exchange trading. This openness, in turn, helps drive innovation in our financial ecosystem. The UK attracts more fintech investment than the next 10 European countries combined, and globally ranks second only to the US. This ability to attract money and talent is an asset few rival centres can match.
These strengths extend benefits far beyond London. Financial and related professional services employ one in every 13 workers in this country, two-thirds of them outside of London. In 2020, 43% of financial and related professional services exports originated from other regions and nations across the UK.
The UK cannot rest on its laurels, though. Rival financial centres from Europe, Asia, and the Americas are elevating their game, and new challenges are knocking at the door. The world needs to raise massive sums of money in the coming years to combat climate change and green the economy. And the UK must be able to keep up as countries around the world experiment with new technologies that have the potential to transform the financial system and make it more accessible.
This report provides a roadmap to build on the UK’s existing strengths and bolster our financial centre to meet these challenges. It proposes nine big moves, including developing a long-term growth strategy for financial and professional services based on partnership between government and the industry; implementing regulatory and structural reforms to unleash greater domestic investment by UK pension and insurance funds; becoming a digital first economy by forging internationally competitive data standards and promoting digital verification, asset tokenisation, and artificial intelligence; and aligning policy and industry standards on climate to accelerate financing for the transition to a low-carbon economy.
The opportunity is there for the taking. It’s time for government and industry to join together to help create a more prosperous and sustainable future.