Is the City losing its powerhouse status?
A triple-dip is avoided but London still faces economic woes. It’s lost its triple A status, growth is sluggish and new EU regulations could hit the finance sector. Is The City still a powerhouse?
There are few who could argue the past five years have been good for London. In The City, dominated by financial and banking services the recession has hit confidence and authority. The avoidance of a triple dip recession is welcome news but the industry isn’t out of the woods. The economy’s credit rating has already been downgraded and there is rising concern from the business community about a new set of regulation due to come from the EU which could affect them further.
The changes include a Financial Transaction Tax and plans to cap bankers’ bonuses at a maximum of a year’s salary. Opposition from within The City stems from the fact that the financial sector is a major part of the UK economy. Critics argue the tax, which is supported by 11 countries across the EU, could negatively impact on the success and growth of the City while knocking a quarter of a percent of growth across the countries concerned. The restrictions on bonuses, some City analysts argue, will deter top talent from around the world from coming to London as they will be able to earn more money elsewhere.
Bad news for the City does not just impact on the financial and banking sector. The industry affects others as well including business travel. Fewer business travellers relocating to the capital and looking for long term stays affects accommodation providers like Clarendon Serviced Apartments.
Clarendon has been working in The City for 25 years. With accommodation throughout the capital and a strong position within the business travel market it not only understands its customers but also has to know how the industry itself works. Despite these recent measures and the fears expressed, Clarendon does not believe that these changes will impact on the City – largely because the benefits continue to outweigh the downsides.
London is a financial centre not simply because of the amount of wealth in the capital but largely because of its location. Its central location between US and Asian time zones makes it the ideal place for negotiations between the two continents at times that suit both sides. It is what feeds the 24 hour mentality in The City ensuring workers are on call and monitoring the markets around the clock. It also means that London is the ideal location for a leading company within the sector who needs to take advantage and use that culture.
With accommodation based across the capital, from The City to Canary Wharf, the West End as well as South West London, Clarendon has been providing accommodation for business travellers for over a generation. This experience allows it to understand what makes London quite so attractive to the business traveller community. The full service offer, for example having serviced apartments as a cost-effective alternative to hotels is a major draw but it’s the infrastructure that supports and endorses the main reason for London’s popularity. The City’s prime location will ensure it remains a powerhouse, no matter the regulations that come into play.