London and New York City have tied as the world’s top financial centres, marking the first year the Square Mile has not been the only occupant of the number one seat, according to a new report by the City of London Corp – Our Global Offer to Business: London and the UK’s Competitive Strengths in Support of Growth.
The report, which benchmarked the performance of the world’s leading financial centres across 95 metrics, found that London continued to perform strongly across all key dimensions, including innovation, reach of financial activity, resilience and business infrastructure, talent and skills and regulation.
However, other financial centres are growing faster. London received an overall competitiveness score of 60, up from 59 in 2022, while New York’s score rose by 2 points to equal London with 60 points.
Both centres were followed by Singapore, Frankfurt, Paris and Tokyo.
The report noted that the number of international companies listed in London is falling and fewer international companies are choosing to list in the city.
This is despite the UK government issuing a range of potential services reforms including bolstering the UK IPO market, as well as attempts to deregulate key sectors such as banking and insurance to drive new business.
There is a view that the US is a more attractive place to list and grow businesses, given the prospect of higher valuations and a less restrictive business culture.
For example, companies such as Cambridge-based Arm and CRH, the world’s largest building materials group, have recently said they would seek listings in New York.
Chris Hayward, policy chair at the City of London Corp, warned that the UK’s competitive advantage was at risk, despite being “one of the most open and global financial centres with better access to international markets than the US, France, or Japan”.
The City of London Corp recently launched a joint initiative with support from Lloyd’s, Schroders, JP Morgan, EY, KPMG, Barclays, Glasswall and CIPL to ensure the UK’s international competitiveness of its financial and professional services sector over the next decade.
The initiative, named Finance for Growth, will focus on tech and innovation, sustainable finance, competitive marketplace and international trade. The group will make recommendations for the competitiveness of UK financial services in Q3 2023.
“A long-term plan to stimulate growth in the financial and professional services sector is needed,” said Hayward.
He added, “This is why we have launched, Finance For Growth, a new joint initiative with leading industry figures across the financial and professional services sector to put together a roadmap to reinforce and renew the UK’s role as a global financial centre.”
©Markets Media Europe 2023
