The City of London is proving to be a resilient financial district that is experiencing significant growth despite Brexit. Michael Mainelli, head of the City of London Corporation, said in an interview with the German Press Agency that the city remains the most important financial location in the world. Contrary to expectations, the trade barriers caused by the EU exit have had less of an impact on the services sector than feared.
The number of employees in the city, also known as the Square Mile, has risen from 525,000 to 615,000 since the Brexit referendum. What is particularly noteworthy is that most companies in this area are made up of small and medium-sized companies. London was also able to increase its global share in asset management from 11 percent to 13 percent between 2016 and 2023.
Before Mainelli leaves office as the 695th Lord Mayor, he is planning a trip to Germany to visit Hamburg and Munich. Looking back, he is convinced that remaining in the EU would have brought even more advantages to the city. In his opinion, Brexit has cost the City around 30,000 to 40,000 jobs. Nevertheless, he emphasizes that the current developments can be seen as a success.
With a service share of around 80 percent of British economic output, the City of London offers a wide range of services in the areas of banking, insurance, science, technology, shipping, art, media, culture and education. Particularly noteworthy are the 40 scientific societies, 177 universities and 130 research institutes that have their headquarters here.
A current analysis by the London School of Economics (LSE) supports Mainelli’s statements. It shows that smaller companies in the goods trade are particularly affected by Brexit, while the service sector was able to significantly increase its exports.
The changes caused by the corona pandemic have also promoted the city’s success. Efficiency gains from the increased use of video conferencing and the associated decline in business trips contributed significantly to this. Mainelli emphasizes that even eliminating two or three personal business trips leads to a significant increase in efficiency.
The City is administered by the City of London Corporation, whose chairman is elected annually as Lord Mayor. This institution not only has administrative tasks, but also represents the interests of local companies.
