Experts say that London may soon lose its position as the world's top financial center. The divorce saga with the EU, aggressive sanctions policy, and the coronavirus pandemic-driven crisis have triggered a large-scale runaway of financial companies from the UK.
Thousands of large firms decided to take away hundreds of billions of pounds from the country. Apart from the financial outflow, the UK is also losing personnel as many immigrants go back to their home countries. Ernst & Young LLP, an audit inspection agency, reports that over the past four years of the Brexit saga, financial services firms operating in the UK have shifted more than 1.2 trillion pounds of assets as well as 7,500 employees to the European Union. In total, in the period from 2016 to 2020, 88 of the 222 UK companies have already moved or are preparing to move their business operations and their staff to one of the EU countries, while 26 companies are ready to relocate to other EU countries. Ireland is the leader among the most attractive countries for business as well as Germany, France, and Luxembourg. Omar Ali, an expert on financial services in the UK, pinpointed that many financial services firms implemented most of their relocation plans before the start of this year, and their relocations were less noticeable in the first half of the year.
Other companies are closely monitoring how negotiation between London and Brussels is unfolding. They will make a final decision about whether to stay or leave based on the results of the talks. Given the fact that Brexit talks have reached an impasse, London is likely to continue witnessing the runaway of large companies, consequently losing its financial throne.
