New research shows the extent that leaving the EU might affect British financial services exports, with shocks likely to be felt far beyond London. Silvia Pavoni reports.

A departure from the EU continues to raise concerns over the future of the UK’s financial services sector. The EU has heavily contributed to the growth of British financial services exports, accounting for nearly half of all such exports in 2017, according to the UK’s Office for National Statistics (ONS). And financial services exports are not only relevant to London, the UK’s major financial centre.

Newly released research by TheCityUK reveals data for other parts of England, as well as for Scotland and Wales. Based on the latest available regional data from the ONS and tax authorities, combined with its own estimations, the lobby group has broken down the values of exports of a wider category of financial and related professional services, such as insurance, accountancy and legal services.

While exports from London’s financial and related professional services are 41% of total services exports, the figure is even higher for the Yorkshire and Humber region and for the West Midlands, at 46% and 48%, respectively. It spikes to 50% for Wales.

Financial and related professional services exports are most crucial to London, at an estimated £50bn ($64.8bn) in 2017. In 2016, these were £47.9bn over a total of £117.3bn services exports and against a total of £31.7bn exported goods. London is the only location where services exports clearly dominate, and where the financial services component, in absolute terms, is the highest. 

But shocks to services exports would also strongly affect the South-east region of England, and Scotland, where those values are the closest to goods exports across the UK, based on 2016 data. Their financial and related professional services exports are also the second and third highest, respectively, after London.

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