Government reports on latest progress to cement UK’s position as centre of global finance
This was published under the 2010 to 2015 Conservative and Liberal Democrat coalition government
The government has today published the second annual progress report from the Financial Services Trade and Investment Board (FSTIB).
The FSTIB was created by the Chancellor 2 years ago and is charged with further strengthening Britain’s position as a key international financial centre, as well as enabling our world-class financial services sector to deliver new jobs and growth throughout the country.
The report sets out progress across the 9 areas of high growth potential that the board has concentrated its resources on so far, and outlines 2 new potential initiatives that could be taken up in the coming year, on strengthening the relationship between the UK and India in financial services and infrastructure finance.
The India financial services work-stream will support the India-UK Financial Partnership, an industry-led initiative that will deepen cooperation between the financial sectors of the 2 countries, and generate targeted recommendations for policy-makers.
The infrastructure finance work-stream will explore ways for the FSTIB to drive a coordinated government and industry effort to increase liquidity in infrastructure financing, and to ensure potential investors have access to suitable projects.
Chancellor George Osborne said:
A key part of our long term economic plan is to cement Britain’s position as the centre of global finance.
Because it’s only by harnessing the full potential of our world-class financial services industry that we’ll deliver the jobs and growth that we need in the future.
That’s why we created to the Financial Services Trade and Investment Board, to help achieve this goal, and today’s latest progress report shows the progress that’s being made and the important work still to be done.
City Minister Andrea Leadsom said:
The government is committed to ensuring that the success of the financial sector works for each and every person in the UK. That means new jobs and growth, and fair share of taxes from the sector to pay for our public services.
We have the largest financial services trade surplus of any country in world, something that delivers benefits throughout the UK. But we must not be complacent. There is a world of new opportunities out there – new markets, new technologies, new partners and investors. The FSTIB is a crucial part of the government’s strategy to ensure the UK sector can take advantage of those opportunities. I look forward with great enthusiasm to seeing it continue to deliver.
As the report highlights, the last 2 years have seen positive trends for the contribution of financial services to the UK economy. The trade surplus in financial services has continued to rise, reaching £59 billion in 2013 and research suggests the tax take from the sector makes up 12% of total tax receipts to the Exchequer, with official figures showing the sector created 16,000 new jobs in 2014.
In its second year of operation the FSTIB made substantial progress across a number of key areas:
- the RMB internationalisation initiative delivered the government’s landmark RMB bond in September and increased integration with China’s rapidly growing financial sector
- the Islamic finance initiative also delivered the UK’s first sovereign Sukuk in June, which illustrated the demand for high quality Shariah-compliant assets
- the Investment Management Strategy, which has made the UK a more competitive destination for investment management and delivered a more efficient authorisation process, is now seeing a notable upturn in funds setting up in the UK
- the government can today (24 March) announce that China Construction Bank International is launching the first ever UK domiciled RMB denominated ETF, which will be listed on the London Stock Exchange
Xavier Rolet, CEO of the London Stock Exchange Group said:
Since its establishment, the FSTIB has played a vital role in coordinating across government and the financial services sector to drive international trade and engagement opportunities. In doing this, it has enabled the UK to compete in the global economic race and helped to deliver tangible wins for the economy, including enabling the UK to become the first western country to launch Sukuk and RMB bonds, and supporting ground-breaking partnerships between the London Stock Exchange Group (LSEG) and the Nigerian, Moroccan and Turkish stock exchanges. As the most international stock exchange in the world, LSEG is delighted to support the FSTIB and it has been an honour to serve on the board alongside the government and industry partners.
Sir Gerry Grimstone, Chairman of Standard Life plc and TheCityUK said:
Maintaining the City’s role as a global financial centre requires close collaboration between the City and HM Treasury. The creation of FSTIB and the way it has worked means that relations are in an excellent state and very valuable work has been done. We hope very much that this will continue.