Teaching Comparative Government and Politics

Thursday, April 06, 2017

Let the public negotiations begin

The letter invoking Article 50 was just recently signed, but the public proclamations of gains and losses (part of attempts to sway public opinion) have begun.

Up to 100,000 UK jobs at risk as Merkel and Juncker ally warns on euro clearing
The future of an estimated 100,000 jobs has been plunged into doubt after a close political ally of the German chancellor, Angela Merkel, and president of the European commission, Jean-Claude Juncker, warned that a prized sector in the City of London must relocate to EU soil after Brexit.

Manfred Weber, the leader of the largest political group in the European parliament… told reporters that euro-denominated clearing could no longer be undertaken in the City when the UK leaves the EU.

“EU citizens decide on their own money,” Weber said during a press conference in Strasbourg on Tuesday. “When the UK is leaving the European Union it is not thinkable that at the end the whole euro business is managed in London. This is an external place, this is not an EU place any more. The euro business should be managed on EU soil.”

Such a development would be a huge blow to the British economy. Six months ago, the head of the London Stock Exchange, Xavier Rolet, said at least 100,000 positions could be lost if the City’s clearing houses lost their ability to process euro-denominated transactions…

London’s dominance in the sector has long been a source of contention within the EU, with the French government being particularly aggressive in attempts to get in on the trades…

Weber said… “Some of the politicians in London have not understood what leaving the European Union means. It means being alone.”

On the future of the financial services sector in the UK, and euro-denominated clearing in particular, Weber added: “Great Britain after leaving will be a third country.

“We have to find a way of working together, but we have the obvious interest that places like Amsterdam, Paris, Dublin and Frankfurt can win as they lose.”

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