People across the City are steadily returning to work, starting to burn off the holiday excesses, and turning their sights to the exciting possibilities of a new year.
It’s obvious that 2019 will present us with substantial challenges, and reserves of resilience and pragmatism will be needed in order to meet them. There will be uncertainty as we embark upon a new chapter in the country’s trading history, but the world won’t simply stop for our sake when we leave the European Union.
However, it is precisely because of this – our reputation for resilience and pragmatism in an ever-changing global financial landscape – that the UK financial services industry can use this opportunity to scale new heights.
The sector plays a hugely positive role across the UK economy. Its continued success is in the interest of the entire nation – in 2018, it made a record tax contribution to the UK Exchequer, and it employs 2.2m people, two thirds of whom are outside London.
That’s why when I head to the Gulf next week on my first international visit of the new year, it will be an important moment to show our confidence in the City’s role as a global financial hub.
Two key themes in particular will be the UK’s capability and innovation in Islamic and green finance – areas in which we are a true global leader, and where we have much to offer the region’s sovereign wealth and capital markets.
In Islamic finance, London has positioned itself to become the hub for sharia-compliant finance in the western world.
The UK already boasts five licensed Islamic banks and over 20 conventional banks offering Islamic financial products, and has more than $700m of assets from Islamic funds.
Meanwhile the London Stock Exchange has over 65 “sukuks” (a form of Islamic bond) listed for a total amount of nearly $50bn.
This goes hand in hand with green finance in the form of green sukuk.
London has already underwritten and issued $80bn of green bonds, and a new Green Finance Institute – to be launched by the City of London Corporation and UK government later this year – will allow us to do even more, acting as a unique one-stop shop designed to help find innovative global solutions to this global problem.
What we can offer stakeholders in the Gulf is just one example.
Here in London we have more than half of Europe’s fintech unicorns, and fintech startups from Africa to the Baltics see the UK as the crossroads for the best in finance, creative and tech, and therefore as the ideal place to scale up their businesses.
Elsewhere, Peru wants our expertise in infrastructure finance as it prepares to host the Pan American Games, while the UK is the largest offshore centre for Chinese renminbi internationalisation and a world leader in the issuance of masala bonds outside of India.
This year certainly won’t all be plain sailing. But there is growing global demand from emerging markets for the wealth of expertise of the UK’s financial sector, and that brings an opportunity to forge a new path.
This needs to become the focus in 2019, as we pool the best of our talent and ingenuity towards building tomorrow’s financial system today.