As Sir Keir Starmer seeks to reset relations with Brussels, the temptation for the prime minister to edge closer to the EU\u2019s regulatory orbit is real. <\/p>\n
But while revamping post-Brexit rules<\/a> to encourage growth and innovation is welcome, the UK\u2019s vision for a globally competitive financial services sector must not be compromised by a return to EU rule alignment. At the same time, the EU remains a critical market and global firms would welcome further arrangements to enable business with European clients.<\/p>\n The City has so far successfully lobbied Starmer to exempt financial services from closer alignment with EU rules. Financial services are the jewel in the UK\u2019s economic crown, employing 1.2 million people and generating a trade surplus of $127 billion (\u00a392 billion) last year. <\/p>\n The EU remains a major market, accounting for more than 30 per cent of exports, on par with the US. Since Brexit, the UK\u2019s share of exports to the EU has fallen, while trade with the US and the rest of the world has increased.<\/p>\n Leaving the EU bloc brought pain \u2014 regulatory frictions increased, passporting rights lost. But it also delivered gains. The UK changed key financial rules to create greater transparency and it is now easier for businesses to list in London, banks face lower capital requirements, and domestic rules are being simplified to boost competitiveness.<\/p>\n These changes have kept the City attractive for new business. Reversing them would risk stalling recovery and deterring global investment. Businesses operating across borders crave certainty, not upheaval.<\/p>\n