Vision for Economic Growth — a roadmap to prosperity 39 5. Pursue world-class promotion and interconnectivity Impact by 2030 Financial and professional services accelerate growth and prosperity across the UK. This comes through increased FDI into FPS, which flows into other sectors. It also derives from increased FPS exports and leadership in setting robust and pragmatic international standards around new technologies and sustainable finance. Overseas firms increasingly see the UK as a focus for investment, and a springboard for providing services globally. Context The UK’s FPS sector is recognised as a global leader 113 Its were managed on behalf of overseas clients. powering growth of the global economy. In 2022, it insurance market is also one of the top in the world, and the largest in Europe, helping businesses to manage attracted a combined value of £2bn in FPS foreign direct 114 The London Market is highly risk and associated costs. investment (FPS FDI) projects, whereby 昀椀rms in other export-oriented, with 68% of its business coming from countries make investments into the UK, either through 115 companies outside the UK and Ireland in 2020. setting up a new entity or expanding the operations here (see Figure 14). In 2022, this FDI created nearly UK services exports were the second highest in the 15,000 jobs. Over half of the jobs created in 2021 were 112 116 There is also enormous opportunity outside London. world in 2022. to grow services to new markets through heightened The UK is also a top destination for international promotional activities. Moreover, trade 昀氀ows are not investors, including pension and sovereign wealth static. In 2021 for instance, the US represented 34.1% funds. Investors seek to invest in the UK as part of a 117 This represented an increase of the UK’s FS exports. 118 According to UNCTAD data, from 30.2% in 2019. diversi昀椀ed portfolio and also bene昀椀t from the UK’s asset UK net FS exports have held constant since 2008, management expertise, which can help them to channel The UK’s performance as a global 昀椀nancial centre their assets globally. Consequently, of the £11.6tn while the US, Singapore and Hong Kong have all There are also major opportunities for the UK as a 119 must be bolstered internationally by strong, cohesive, assets under management in the UK in 2021, 46% increased signi昀椀cantly. convening power for 昀椀nancial services innovation. and strategic promotion. Traditional strengths, such as The UK has a long track record of leading supranational time zone, language, and rule of law, are important but policy conversations. In 2008, the Treasury rescue plan Figure 14: UK FPS FDI in recent years cannot stand on their own in an increasingly competitive for UK banks became a template for wider eurozone and £ Million global marketplace. Equally, we need to re昀氀ect the wider 2,071 US government actions. More recently, the UK’s FCA has pool of “pull” factors that the UK can o昀昀er. These new chaired the Coordination Group of the Global Financial factors include transition 昀椀nance expertise and proven Innovation Network (GFIN), as well the International leadership around technological innovations, such as 869 Organisations of Securities Commissioners (IOSCO) 120 The UK also 1,339 open banking and AI. In selling its o昀昀er to the world, workstream on crypto and digital assets. provides leadership on technical standards. In each 1,234 UK FPS will need to show how it serves its clients in case, UK leadership draws on its existing strengths as 428 solving global challenges from the net zero transition 399 an international 昀椀nancial centre. to tech transformation, and how it can support 昀椀rms to 670 昀氀ourish and grow. Bringing together the full coalition of The following two big moves are catalysts to ensure 298 1,202 UK players, with a strong vision and narrative, would 911 835 powerfully increase the UK’s impact. that the UK’s FPS promotion is most impactful and 372 that it continues to be innovative in its approaches to embedding market access. 2019 2020 2021 2022 Financial services Professional services Source: fDi Markets data as published by the City of London Corporation (2023): https://www.theglobalcity.uk/resources/foreign-direct-investment.