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This record figure is a key contributor to mitigating the nation’s increasing trade deficit (£-38.7bn in 2015 [2]), underlining the importance on the UK’s export of services – in particular financial and related professional services – to boost economic growth.
According to the report: ‘Key Facts about the UK as an International Financial Centre’, the UK’s trade surplus in financial services was larger than those of the next four leading countries combined: the US, Switzerland, Luxembourg and Singapore. When the estimated trade surplus for related professional services is also taken into account, the overall surplus for the industry climbs to $110bn (£71.9bn).
Miles Celic, Chief Executive, TheCityUK, said:
The continued growth of the industry’s trade surplus is a direct reflection of the strength of the UK as the leading exporter of financial and related professional services globally.
Thirty years on from the momentous changes which resulted in the so called Big Bang, the UK-based financial and related professional services industry has made its most significant contribution to UK exports to date. Our largest trading partners are the US and the EU, but our ability to strengthen and deepen trade and investment ties with key developed and emerging markets over the coming years will be absolutely central to enabling us to deliver ongoing economic growth – particularly in the context of Brexit.[...]
Other key facts from TheCityUK’s report include:
- In 2016 the UK accounted for 37% of global foreign exchange trading with twice as many US dollars and Euros traded in the UK than in either their home markets.
- London hosts the greatest number of foreign banks (250), and has the largest share of international bank lending (17%) in the world.
- The UK is the only place where all of the world’s twenty largest international insurance and reinsurance companies are active.
- The UK hosts two of the world’s four largest legal firms and accounts for 10% of global legal services fee revenue, second only to the US.
- London has the highest share of international equity markets in the world with more than 518 foreign companies listed in the city (listed on the Main Market of the London Stock Exchange and quoted on AIM).
- The UK is the leading centre for international bond trading, with an estimated 70% of secondary market turnover based in London.
- The UK is the leading western centre for Islamic finance, home to around 20 banks, five of which are fully Sharia licensed. London is also the home of the world’s first and only Sharia compliant underwriting agency – Cobalt Underwriting.
- The UK accounts for around 10% of global legal services fee revenue which totalled around $620bn in 2014/15. It is by far the largest market for legal services in Europe accounting for over a fifth of the sector’s revenue, and is second only to the US globally.
- Regional financial centres with developed clusters of financial and related professional services are an important part of the UK’s financial services ecosystem. The relationship between the regional centres and London is a symbiotic one: a strong London is good for regional economies, and strong regional centres increase the global appeal of London by widening the talent pool and offering growth opportunities.