Bank of England Governor Andrew Bailey has warned that the EU could cut off UK financial Services.
Financial Services, the UK's biggest export was excluded in the Brexit Trade deal and Mr Bailey suggests EU demands are unreasonable but both sides have been working together to reach an agreement by the March 2021 deadline and both sides should then recognise each others regulations as equivalent.
In his annual Mansion House speech address to the City, Bailey wrns that the UK cannot be dictated to by the EU in determining what rules and standards the UK must follow.
He continued to say: “It would be a mistake if the EU decide to cut off the UK and we have to state the argument for global standards and markets and openness if everyone agrees to that then there is no need for the EU to cut off the UK from its financial markets".
Since the 1st January the London has lost £135 billion to hubs such as Amsterdam.
However, Brussels will not be rushed into a decision on granting UK financial firms access to EU markets and wants to see how far UK rules will diverge from their own rules, this follows fears that the UK may move to a Singapore model and adopt a low-regulation style that would undercut the EU.
Mr Bailey said: “Despite the current situation London would still continue as one of the worlds leading financial centres and whilst some UK rules would change post-Brexit, sudden deregulation was not in the cards and the EU is holding the UK to unrealistic high standards”.
During the Brexit transition 7,000 finance jobs had been relocated from London to rival EU centres which is lower than the 'armageddon' predictions of 50,000 job losses.
We believe whilst it is clearly easier and better initially for the financial services industy to have EU access, perhaps it is time to further develop strong ties with the rest of the World.