Whilst the financial markets were affected in the immediate wake of the referendum, within a week they began to rally and the FTSE reached its highest level since April. And there is further evidence of renewed business confidence in post-referendum Britain: a recent survey found that two-thirds of global institutional investors believe it is unlikely that London would lose its coveted status as a world-leading financial centre. Seven in ten investors think mergers and acquisitions activity will increase, more than half think the UK will retain access to the Single Market and 59% expect the UK’s trade outside of the EU will increase. Another study – by BMI Research, a subsidiary of ratings agency Fitch – said that leaving the EU could be a net positive for the UK economy.
For many businesses it was not so much the risk of Brexit that has concerned them in recent months, it was the uncertainty and unpredictability over the future direction of policy that the referendum represented. Now that the outcome is known, businesses can plan accordingly.
There is also every reason to expect that ‘Brexit’ could boost visitor numbers for London. In the short term a weak pound could help attract visitors, including those from within the EU keen to see the UK before any potential changes to free movement may happen. In the longer term, new immigration rules could make it easier for wealthy visitors from non-European countries like China to come to the capital - something that many of the capital’s high-end retailers and other visitor economy businesses have long called for. It is also possible that all this renewed media interest in the UK may well serve as a ‘pull’ factor for business tourists too, and major events and conferences could be attracted to London by any ‘Brexit boom’.
London may have voted to remain – and was the only English region to do so – but there are still many reasons to have confidence in the capital and its economy. London always has and always will be a great place to live, work and do business. Even outside of the EU, London’s advantages as a world city - its time zone, access to cutting edge technology and innovation, a competitive business environment, transport connectivity, its economic dynamism, its strength in financial services, the availability of a highly skilled workforce, and its innate entrepreneurial spirit – will ensure that the capital will not just survive but thrive in the global economy.
