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John Glen, a minister in the Treasury, suggested on Monday that the EU had shown a new willingness in recent months to offer a deal to protect the Square Mile when the UK withdraws from the bloc.
Glen added that the transition deal agreed by Britain and the EU last month would allow financial firms to move forward and plan for their future with confidence. He insisted the UK’s high regulatory standards would remain and allow a close relationship between regulators on either side of the English Channel to prosper.
“We do not intend to rip up the rulebook after Brexit,” Glen told a conference in the Guildhall, in the heart of London’s financial district. “The fog is clearing … We are already seeing progress. The EU have now recognised that there will be some form of market access in financial services having previously dismissed the idea.”
However, EU officials in Brussels said the UK appeared unwilling to accept the reality of their position. The EU has already dismissed the UK government’s proposals of mutual recognition of each other’s regulations in the financial services sector. [...]
Catherine McGuinness, the policy chief for the City of London, the municipal body representing the capital’s financial district, warned that the suggestion of mutual recognition of regulations was the “only game in town”.
A second diplomat in Brussels involved in the Brexit negotiations told the Guardian: “Everyone knows that that the City of London is going to relocate to New York.” However, the UK chancellor, Philip Hammond, gave a bullish assessment of the City’s prospects last week, saying a damaging haemorrhage of finance jobs had been halted by the transition agreement. [...]