Post-Brexit banking shake-up to advantage UAE financial centresRoemarie Ann Periabras
Post-Brexit banking shake-up to advantage UAE financial centres
The UAE can reap the benefits of Brexit, with financial free trade zones, such as ADGM, becoming attractive places to accomplish business.
While European capitals are battling it out to woo London’s bankers post-Brexit, the towns that stand to get the most could possibly be far further afield, including New York, Dubai and Hong Kong, according to Miles Celic, chief executive of TheCityUK
Chief executive of the influential financial lobby group told The National a so-called “very difficult Brexit” may cost London up to 75,000 jobs, and there is absolutely no guarantee these find yourself moving to the likes of Frankfurt, Dublin and Paris.
“A likely destination is NY,” Mr Celic stated, arguing that lots of American companies with a big presence in the United Kingdom will just repatriate careers following the country leaves europe, instead of search for another hub on the continent. “That is where the 1st tranche of careers will go.”
The next tranche will head to Asia, he said. “That’s even more about the financial change of activity,” he explained, citing solid growth rates in Asian economies in comparison to a comparatively stagnant development profile in the United Kingdom and additional western nations. Gleam growing middle income that may support future financial expansion.
Brexit offers been the “catalyst” for a complete selection of business decisions that may otherwise not need been taken for a long time, according to Mr Celic. The change of capital to Asia is usually one such decision.
Middle East also stands to take advantage of the shake-up of financial centres in the wake of Brexit. “It’s something we are extremely aware of,” Mr Celic said.
He argues that the timezone of GCC says will play a significant factor in this, as companies are increasingly keen to have 24 hour protection which helps the argument to open up offices in the likes of Dubai or Abu Dhabi.
Financial free trade zones and enterprise areas also help to make Middle Eastern centres an attractive spot to do business, as do incubator programmes for start-ups, like the fintech hive that was recently opened up in the Dubai International Financial Center and Abu Dhabi Global Market’s new Reglab.
Islamic finance is usually another area of “large potential growth”, Mr Celic said, and hubs in the middle East are by much the leaders in this area. London may be the biggest center for Islamic finance beyond the Middle East, and it is an area that he says the town is keen to develop further.
The third tranche of London’s banking roles will simply be discontinued after Brexit, as they will no longer be required by firms, Mr Celic said.
Meanwhile, the fourth and last batch of careers will probably change to the EU, but actually these will end up being fragmented across plenty of centres, instead of concentrated in only one city. “It isn’t a zero sum game,” he argued. “This notion that Paris benefits at the trouble of London, or Frankfurt… it generally does not build up.”
Nevertheless, Mr Celic insisted that he’s not really complacent about the chance posed to London’s status mainly because a respected financial hub after Brexit.
“I am not complacent – London does not have any God-given to business,” he said.
Much depends on the type of deal is ultimately struck with the EU. TheCityUK offers been hosting regular delegations to Brussels, and has offered a listing of priorities to the federal government stating what the financial industry really wants to accomplish from the Brexit talks.
Mutual market access between the UK and the EU is usually very important, Mr Celic stated, to be able to allow financial firms to keep their cross-border business activity. A transitional period can be critical in order to avoid a “cliff-edge” after the UK officially leaves the bloc in March 2019. He also stressed the need for maintaining usage of talent and making sure robust regulation.
In a blue-sky situation, however, he believes Brexit is actually a major chance for London’s placement on the world stage.
“We could possess the most extensive free trade offer that’s ever been carried out. If we have the ability to get a free of charge trade contract that covers products and also services, this may be a model for all the potential trade agreements.”
Source: The National