Memorandum submitted by the City Corporation
I was interested to see the Committee's plans
for an inquiry into cross-departmental working on development
and trade which was announced shortly before the House rose for
the Summer Recess.
The City Corporation is not in a position to
respond fully to the questions posed by the Committee in the call
for evidence but in the context of the City of London as a global
financial centre, it is perhaps worth highlighting the importance
of the business City in financing international trade and development.
London is widely regarded as a World City. The
prominence of the City of London as a leading international centre
for financial and business related services is well documented
as an integral part of the capital's success, not least because
of the cluster effect of financial capital and expertise found
in close proximity.
For developing markets, access to services is
as important as access to goods. The international nature of City
institutions, and open borders for financial and related business
services, allow for technical skills and expertise to be shared
internationally to the mutual benefit of both the provider and
recipient economies. The market access work undertaken by Department
for Business, Enterprise and Regulatory Reform (BERR) through
UK Trade and Investment (UKTI), and supported where necessary
by the Treasury and Foreign and Commonwealth Office (FCO) is an
important part of the wider international development framework.
Infrastructure projects aimed at facilitating
development, such as improving access to utilities and increasing
road and port capacity etc, are increasingly undertaken using
financial and legal structures similar to Public Private Partnerships.
The business cluster found in the Square Mile has enabled the
City to present a complete package to advise on these structures.
The promotion of PPPs has become a prominent feature of the Lord
Mayor's overseas visits programme. The planning of these visits
involves extensive consultation with Government departments.
The City's engagement with India is a good illustration
of the contribution the City can make to international development
in coordination with Whitehall departments. The City Office in
Mumbai was established with the overall aim to strengthen trade
and investment links in both directions between India and the
UK, and promote awareness of the services the City institutions
can offer. Although funded and managed by the City Corporation,
the Office is very much intended to be a resource for the whole
financial and business related services sector. It works to promote
the services of the City to Indian public and private sector customers
including the raising of capital, insurance, asset management,
infrastructure finance and consultancy, London's exchanges, business
education & training and legal & advisory services. The
Office also works to identify formal or informal barriers to market
access for financial and business related services, and to promote
the UK as a physical location for Indian financial and business
related services.
The work of the City Office is steered by an
Advisory Council for India, comprising senior Indian businessmen.
It is the City of London's aspiration that this activity be beneficial
to India, in particular by assisting Indian providers of goods
and services to expand internationally. The Advisory Council provides
guidance to achieve this aim, and ensures that the City Corporation's
work matches Indian aspirations. Through the City Office, and
regular Lord Mayoral visits, the City of London is well placed
to assist the development of Mumbai as a financial centre, identified
as a priority by the Indian Ministry of Finance earlier this year.
The City's approach is based on the demonstrable reality that
improved access to the global financial system is a benefit, indeed
a necessity, for countries at India's stage of growth. A greater
degree of market penetration by international financial services
firms and the development of an international financial centre
(IFC) in Mumbai will support Indian businesses as they themselves
become companies of regional or even global significance.
In this work, the City of London works closely
with the Treasury, UKTI and the FCO both in the UK and in India.
The City Office has been established to provide extra resource
without duplication, and work streams are therefore coordinated
with other interested departments. For example, the City Corporation
has commissioned independent work on the development of India's
corporate debt market in coordination with the Treasury, who have
also identified this as a priority for Mumbai's development as
an IFC. The UK Deputy High Commissioner in Mumbai attends the
Advisory Council and the work of the City Office is undertaken
in close liaison with UKTI staff in India.
More broadly, the City Corporation is part of
the Financial Services Sector Advisory Board, which coordinates
UK promotion of financial services. Through this forum, high level
visits by the Lord Mayor and the Chairman of Policy and Resources
are coordinated with those of government Ministers from BERR,
UKTI, the Treasury and the FCO. Through funding of International
Financial Services London, the City Corporation also contributes
to the trade policy work of the Liberalisation of Trade in Services
Committee and the Joint Economic and Trade Committee, in coordination
with UKTI and BERR.
Bruce Hunt
Senior Parliamentary Affairs Officer
Office of the City Remembrancer
Parliamentary Agency to the City of London
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