Although the UK did not agree any provisions relating to financial services, one Tory MP has claimed there shouldn’t be any concerns for the sector going forward post-Brexit. Tory MP for Hitchen and Harpenden Bim Afolami told Express.co.uk the UK’s real competitors in the sector are Singapore, Hong Kong and New York, not Brussels and should be Britain’s targets going forward. Now free from the EU, the MP also claimed Britain cannot be sucked into a conflict with Brussels to grant equivalence to financial firms.
Instead, Mr Afolami insisted the UK must continue to have a global outlook if it is to succeed in having a successful future away from the EU.
He said: “When I speak to people, senior people in the sector, they all tell me, they spend a lot of time thinking about what’s going on in Asia.
“That’s not to say they don’t think about Europe but in financial services terms, our big competitors are the United States, Hong Kong and Singapore.
“And we just shouldn’t lose sight of that by being sucked into a row with the EU over derivative trading, important though it is but actually, the big picture here is we’ve got to have a global outlook.”
The UK and EU have been locked in negotiations since Brexit over a memorandum of understanding for the financial sector.
Despite the negotiations, it is thought the EU will not grant equivalence to UK firms.
The EU insisted it must have guarantees the UK will not drop taxes and regulations if equivalence were to be granted.
By not having equivalence, UK firms must adhere to two sets of regulations rather than one which has caused some to relocate to the continent.
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“Some people have said financial services have been left out but firstly, trade agreements don’t typically have services.
“But more importantly, it’s going to take some time to work out this relationship, it’s not easy.”
The MP also called on increased scrutiny for Parliament over the financial sector and the creation of strict regulations.
This comes in contrast to some who have called on a low taxes and low regulation ‘Singapore-on-Thames’ model.
Attacking the Government, the Labour party has called on Westminster to be more ambitious over the sector’s future.
Shadow Chancellor Anneliese Dodds said: “The government seems to be trying to manage expectations down from where we should be as a country.
“Having access to the financial and related services in London and indeed across the UK – that’s a tremendous benefit of business and individuals based in the EU 27.
“We’ve shifted from a situation where the UK government said it was going to seek passporting for our services then they resiled from that to saying let’s makes sure we have equivalence and now we’re bumping along the bottom.
“I think we’ve got to be ambitious here and break beyond that zero-sum mentality and emphasise having trade in the financial and related services industry.”