Rather than wait to see the outcome of future
discussions, firms ranging from the global
investment bank Goldman Sachs to British
insurance company Aviva have announced
plans to relocate some operations to other EU
countries to ensure they maintain a toehold in
the bloc.
At least 332 firms in the U.K. banking and
finance industry have prepared for Brexit by
relocating part of their business, moving staff or
setting up new entities in the EU, according to
a study by New Financial, a London-based think
tank. It also identified some 5,000 staff moves or
local hires made in response to Brexit, stressing
that the figures are likely to rise when the terms
of Britain’s departure become clear.
“Financial services have resigned themselves
to have a fairly hard Brexit from their point of
view,” said Jonathan Portes, a senior fellow at The
U.K. in a Changing Europe, a non-partisan think
tank at King’s College London. “What we will
essentially see is a slow drift away from London
being by far the most dominant financial center
in Europe.”
Johnson’s Brexit deal covers only the so-called
divorce issues, including payment of the U.K.’s
financial obligations and citizen’s rights. The
future relationship between Britain and the EU,
including a potential free-trade agreement, will
be the subject of a second round of negotiations
that the government wants to complete by the
end of next year.
TheCityUK, which represents Britain’s financial
services, said that so far Brexit talks have
largely focused on trade in goods, neglecting
the services sector, which accounts for 80% of
the economy.