15 May 2007
New City report shows how financial services fuel EU
economy
A new report commissioned by the City of London is launched in
Brussels today (Tuesday 15 May) showing the contribution of the
wholesale financial services sector to the EU economy.
The Importance of Wholesale Financial Services to the EU Economy
2007 shows that EU wholesale financial activity reached €195bn in
2006, representing over 30% of the global total.
The authors of today’s report, the centre for economics and
business research (cebr), analyse the sector’s development within
the EU over the past five years and assess the impact of the
Financial Services Action Plan (FSAP) – the EU’s plan for creating
a single integrated financial market.
The report finds that the average annual growth rate of
wholesale financial activity in the EU has grown by an impressive
6.5% per year between 2001 and 2006 outperforming the equivalent US
growth rate of 6.0%. This is over three times greater than the
overall EU economic growth rate of 1.9% over the same period.
City Policy Chairman Michael Snyder welcomed the positive
findings: “While it only represents 1.7% of EU GDP, wholesale
financial services is a highly productive sector. It also confers a
number of external benefits on other sectors of the economy,
including lowering the cost of capital, enabling firms to invest
and expand, and allowing resources to be directed to areas of
greatest economic return.
“In that sense financial services are critical to the stronger
growth of the EU economy and fulfilment of the Lisbon Agenda.”
The report finds that wholesale finance in the EU is becoming
increasingly integrated. For example, crossborder loans between EU
banks now make up 42% of all inter-bank loans, up from just 26% in
1997.
Michael Snyder hosts a seminar in Brussels today which will explore
the findings of this annual research publication in more depth with
senior EU public policy officials and financial services
practitioners.
“The EU’s leadership of global wholesale finance is driven by the
success of the London cluster, which alone accounts for 28% of EU
wholesale finance”, said Michael Snyder.
“Its success is based on numerous factors, including its open,
international character, its skilled and flexible workforce, its
high quality communications infrastructure and its proportionate
and effective regulatory framework.”
Ends
Download a copy of the report
For further information contact:
Rebecca Sandles City of London Press Office
Tel: 020 7332 1452;
email
Notes for editors
The City of London provides local government
services for the Square Mile, the financial and commercial heart of
Britain and is committed to maintaining and enhancing the status of
the business City as the world's leading international financial
and business centre through its policies and services. Its
responsibilities also extend far beyond the City boundaries and
include management of the Barbican Centre, Central Criminal Court
at the Old Bailey, Epping Forest, Hampstead Heath, three wholesale
food markets, as well as acting as the London Port Health
Authority.
The City and Brussels: The City of London aims
to promote and reinforce the competitiveness of the Square Mile and
in particular UK-based international financial services by tackling
issues created by EU economic, legislative, fiscal and regulatory
developments which may impact or threaten to impact on the open,
efficient and competitive environment for doing business in the
City.