The EU’s Brexit negotiator, Michael Barnier, has said that “The City is more important to the EU than Europe is to the City”. His comments will ease fears from those in the City about the consequences of Brexit. Financial institutions based in London had feared a loss of access to the single market. Some commentators had predicted an exodus from the City, as FS firms relocated to the continent in order to retain market access.
The Guardian originally reported the comments, made in a private meeting with members of the European Parliament, but Mr Barnier later tweeted “When asked on equivalence I said: EU would need special vigilance on financial stability risk, not special deal to access the City.”
EU officials responded, saying that the Guardian report did not accurately reflect Mr Barnier’s words, stating that the EU was looking at the equivalence rules only, not a special relationship. However, minutes of the meeting seemed to contradict this statement, saying “Some very specific work has to be done in this area … There will be a special/specific relationship. There will need to be work outside of the negotiation box … in order to avoid financial instability.”
Governor of the Bank of England, Mark Carney, echoed this viewpoint, saying “the consequence would be greater for Europe than the UK” if there was a disorderly Brexit without concessions for FS.