Chris Hayward (City of London) : Seeking Partnership in Europe
Chris Hayward, Policy Chairman of the City of London, expects Luxembourg’s longstanding relationship with the City of London to continue and strengthen, despite Brexit. While the UK is developing its own regulatory regime, he believes Luxembourg and the UK should keep conversations alive to exchange lessons learned and success stories.
How has Brexit affected the financial relationships between the UK and Luxembourg?
The business communities in Luxembourg and the UK have long fostered their deep-rooted financial relationship. Both sides will have to adapt to this new relationship with firms in both centers benefitting from continued access to each other’s markets. Despite the predicted “doom and gloom” reports, only 7,000 jobs have relocated to Europe in response to Brexit. As close neighbors and each other’s largest trading partners, the partnership between the UK and EU is too important to put to one side. With the recent UK and EU agreement, the Windsor Framework, there is now an opportunity for UK financial services to engage productively once again with our partners in the EU for the benefit of both our economies.
“Luxembourg and the UK should keep conversations alive to exchange lessons learned and success stories”
What are the main points addressed by the post-Brexit reform in the UK?
The Edinburgh Reforms announced by the UK government earlier this year, provide a vision for a global, competitive, sustainable, and technically advanced financial service sector. There is continuing demand for UK financial services expertise in Brussels. Britain and the EU are not engaged in a regulatory race to the bottom but in agile and flexible regulation in the interest of citizens and businesses. As the UK’s regulatory regime evolves definitions of activities like fintech and assets like cryptocurrencies must be made more precise to give market participants clarity. This highlights the importance of global coordination and the use of common principles across jurisdictions.
To what extent could the UK and Luxembourg relations in the financial sector be strengthened?
Luxembourg and the UK should keep conversations alive to exchange lessons learned and success stories. The UK and Luxembourg, as major players in EU finance, are facing a series of common challenges in financial services. These include delivering equitable and sustainable growth across our societies; tackling the transition to net zero and managing digital transformation. The UK and Luxembourg must collaborate with these ends in mind. Finding solutions to these challenges will rely on open, functioning global markets. From London’s point of view, it can contribute its fundamental strengths such as its vast international reach, pragmatism, and spirit of innovation. With that in mind, we are confident that our unique city will continue to thrive for decades to come.