We recently spoke to Daniel Gros, director of the Centre for European Policy Studies to hear his thoughts on the economic impact of Brexit on the UK and EU*. He will be speaking at the Chatham House Global Capital Markets conference on 23 March.
Do you think the UK leaving the EU will affect London’s position as a leading global financial centre?
Not strongly. London will probably use some 'euro' related business, like clearing and settlement, and possibly on asset management. However, in terms of its global business the city would not be much affected as its main competitive advantages will continue: a concentration of the world's best financial experts, an excellent court system which operates in a language which everybody understands and flexible labour laws.
What do you think will be the biggest challenge in the Brexit negotiations from both the UK and EU perspectives?
The overall challenge on the UK side is to avoid the politics of sovereignty impeding sensible economic solutions. On the divorce: the monetary issue (how much to pay for legacy costs) will be most difficult.
What do you see as the future for Europe’s Capital Market Union?
I do not expect a real capital market union to emerge among the 27 as national preferences, legal systems and consumer protection laws and practices diverge too much.
What keeps you awake at night?
The drift towards populism.
What are you most looking forward to at Chatham House’s Global Capital Markets conference?
Insights and discussions with experts and colleagues.
*Please note that the views expressed above are of the speaker and not of Chatham House.