Cheer up! London could be the new 'Super Singapore'

Credit: Micha Theiner

L-R: David Wighton (FN), John Redwood, Lord Flight and Barney Reynolds

These were among the points put forward by an FN Brexit panel that gave the upbeat case for the UK leaving the EU.

Much of the optimistic message came from Leave campaigners John Redwood MP and Lord Flight. However, Barney Reynolds, head of global financial institutions at US law firm Shearman & Sterling, also reckoned much of the gloom over Brexit was misplaced.

Arguing that leaving the EU gives the City an opportunity to turn itself into “super-duper Singapore,” the panellists – moderated by FN columnist David Wighton – said the decision could free the UK from European regulatory burdens such as bonus caps and increase its relations with non-EU markets and Commonwealth countries.

Redwood, an ex-Rothschild banker whose ministerial career has seen him oversee both the City and trading relations with the EU, said after Brexit the UK would not be alone: “You are alongside mighty America, Hong Kong, India, Brazil, Japan, who all have similar interests to your own.”

He argued that the UK won’t “need to negotiate very much at all” as the rest of Europe has “a lot more to lose than we do”. While many advocate the UK treading water until October 2017 after German and French elections, he argued the aim should be to get it done before.

• Come to FN’s next Brexit Breifing on fintech on September 29. More info here

The panellists saw opportunities for deregulation and a renewed drive to other markets, including Commonwealth countries, where the UK has historically done business.

They also challenged much of the conventional wisdom on passporting. Many large firms are demanding the UK stay a member of the single market so their London staff can do business unfettered in the rest of Europe as they do today.

However Flight, co-founder of Guinness Flight Global Asset Management and former shadow Chief Secretary to the Treasury, said that outside the single market a regime based on equivalence – as envisaged under EU regulations such as Mifid II – would work.

Flight said: “I don’t see any problem with equivalency [being accepted].” Post-EU exit, he said he can now see the UK becoming a “super Singapore”.

Reynolds added that the negotiating position of the City is currently flawed because it is aiming to replicate its current passporting model rather than doing things its own way.

He said: “The equivalence regimes are far, far broader than many people have acknowledged so far,” adding that the equivalence package on offer would get the sector to almost the same place.

“Equivalence comes with sovereignty, and sovereignty comes with doing things our own way. [You] can take whole buckets of EU law out of our system on the basis that they’re not relevant to equivalency. An awful lot of the laws are not relevant.”

Reiterating the idea that London could turn itself into a “super-duper Singapore” he later said the sector had “safety belt upon safety belt” of rules imposed on it and that an exit from the EU would enable the UK to re-examine these.

Flight acknowledged there was a risk of “silly behaviour by the [European] Commission”, blocking win-win deals, but that the trade arguments should win the day.

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