The pressure is on for all financial services firms with the powerful operations located in the City of London and elsewhere in the UK to decide where they want to be sited in the post-Brexit world. Only this week, Nicky Morgan, the newly-appointed Chair of the Treasury Select Committee, demanded to know what the Bank of England had gleaned regarding the preparedness of UK banks and insurance companies after we leave Europe.
As she rightly said: “Getting it right will be crucial for ensuring the City retains its pre-eminence as a global financial centre.”
Of course, we already know that some of the international big-hitters – outfits like Goldman Sachs, J.P. Morgan, UBS, Citigroup, Standard Chartered, Morgan Stanley are already starting to pack their bags for a quick getaway – aided and abetted by the likes of the Irish authorities who have been crowing that they have already clinched deals with a dozen or so London-based banks and finance houses for them to relocate to Dublin. Other front-runners determined to lure away our finest include Frankfurt, Paris and Luxembourg. Not very sporting, but, in their situation, you would, wouldn’t you?
Nevertheless, it came as a pleasant surprise to see that the manufacturers have not so easily been put to flight. The shining example is BMW which, having threatened in February this year to switch some of its operations abroad, probably to Amsterdam, has decided after all to manufacture the all-electric Mini at its Cowley plant, in Oxfordshire, when it rolls off the production line in 2019. The electric drive train will be manufactured in factories in Bavaria and then shipped to the UK for assembly with the rest of the vehicle.
This is good news, not least because more than 50% of Minis and Mini components manufactured in the UK are exported to Europe. So, irrespective of Brexit, a decision that will generate millions in £/€ trade has been arrived at and acted upon.
BMW’s decision was announced the day after Greg Clark, the Business Secretary, revealed that he was creating a new £246m fund to invest in battery technology to be spent over a four-year period. Another decision taken and acted upon from the industrial sector.
How refreshing when compared to the actions of people who make money out of the wealth created by others and who are waiting to see which way the wind blows before they show their hand. And how very predictable.
