London’s finance and professional services sectors beat global counterparts in foreign investment
London attracted foreign investment in more financial and professional services projects than any of its global peers last year, according to a new report from the City of London Corporation.
The city accounted for 114 of the UK’s 186 deals in 2021, surpassing peers such as Dubai, which recorded 104 projects, 103 in Singapore and 54 in New York.
The UK as a whole came in second behind the US as the country attracting the most projects.
A third of all UK projects were focused on the fintech sector, according to the report, easily outpacing the 10% of projects that were in banking and the 10% focused on private equity or venture capital.
While one would expect figures from the City of London Corporation – the governing body of the Square Mile – to shed a positive light on the financial district, they add to a growing body of research suggesting that the capital has effectively managed to retain a large part of its financial services. prowess in the wake of Brexit.
EY’s latest Brexit tracker and Schroders’ latest Global City Index, both released last month, show London has retained its top spot among global hubs and the pace of job moves out of the capital continued to shrink.
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While country-level trade deals struck since the EU split with countries like Australia, Japan and New Zealand have drawn criticism for adding negligible amounts to Britain’s economy , the figures suggest that the city’s private sector continues to attract outside interest. .
City of London Lord Mayor Vincent Keaveny, who is also a partner in law firm DLA Piper, described the combination of time zone, language, legal system, global talent and financial services ecosystem of the capital as “unique”.
“Our position at the crossroads of Europe’s largest financial and technology sectors makes us one of the world’s leading innovation hubs,” he added.
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“Our fundamentals remain strong and the UK’s continued attractiveness to investors is demonstrated by a strong portfolio of projects both in the capital and in other regions,” said Catherine McGuinness, Chairman of the City of London. Corporation. “It is essential that we continue to build on this success. We must future-proof the sector and ensure that we remain globally competitive as we open a new chapter in our business history.
Innovation and competition have been the government’s watchwords for the City since Brexit. He is currently consulting on plans to force regulators at the Bank of England and the Financial Conduct Authority to give London’s international stance more weight when writing their rules, as well as “assessing compliance with relevant trade agreements” as part of its Review of the future regulatory framework.
While the government has pushed to open Britain’s financial sector to new economies, Europe remains a key source of foreign direct investment in financial and professional services firms, according to figures from the City of London Corporation – around one third of the projects in the UK were funded by Europe.
Switzerland, France and Germany were all among the top five investors in the UK financial and professional services sector.
The city’s importance to the wider UK economy was also highlighted, with London noted for accounting for nearly two-thirds of investment projects in the study and nearly half of jobs created.
To contact the author of this story with comments or news, email Justin Cash