Tonight:
4°c
City bosses unite in move to promote the Square Mile abroad
Pippa Crerar, City Hall Editor8 Dec 2008
THE City of London is to undergo a dramatic overhaul in the way it is promoted as a global financial centre, it emerged today.
An elite group of businessmen, chaired by Merrill Lynch European chairman Bob Wigley, will propose setting up a new board to "sell" the Square Mile. Mr Wigley was asked by Boris Johnson to chair the five-month review of London's financial services industry, which is due to report this Friday.
His review will warn that London's status as a leader in the financial sector is under threat due to the economic downturn unless it takes dramatic action. It will recommend that a new board - chaired by a heavyweight business figure - is set up to take on an umbrella role promoting the City.
Members of the group, which also included Aviva chief executive Andrew Moss and Lloyd's of London chairman Lord Levene, are understood to feel there are too many separate bodies with the same remit. Around a dozen organisations - including the CBI, the London Development Agency, UK Trade and Investment and the London Stock Exchange - currently work to attract investment to the capital.
A source close to the group said: "The City makes a huge contribution to national life... That message is an important one but it has been neglected."
There have been reports the group will suggest the City of London Corporation, which oversees the Square Mile, should effectively be split into two.
One part would focus on its existing local authority responsibilities, such as schools, housing and the environment, while the other would concentrate on the financial services sector.
The Wigley review will also make recommendations on controversial issues such as tax, skills, infrastructure and regulation. The source said: "This report will be a sign that London intends to fight for its status against offshore tax havens, emerging centres like Shanghai, and competitors like New York and Hong Kong."
The group was advised by McKinsey consultants who worked with Mr Johnson's New York counterpart, Michael Bloomberg, on a similar project last year. A City Hall insider said: "Bob [Wigley] has come up with a very good piece of work that tells us what the threat is to London's status and what we can do to counter it."
The report is also expected to highlight opportunities for growth, such as the City becoming an international hub for the burgeoning Islamic finance sector and cash-rich sovereign wealth funds, which have ploughed tens of billions of pounds into the banking industry.
It comes as it emerged the Government has sounded out the Qatari royal family to help fund the £900 million Olympic village development should Australian property giant Lend Lease walk away from the project.
Meanwhile, the Mayor today encouraged London's small and medium businesses to apply for EU funding to help them grow and safeguard up to 10,000 jobs. He was promoting the European Regional Development programme alongside Minister for London Tony McNulty and European Commissioner Danuta Hubner.
The fund, which has already agreed revenue and capital funding for 60 projects, will invest £150 million in the capital's businesses in the next six years, to be matched by the firms themselves, to boost trade and promote greater innovation.
Mr Johnson said: "Small businesses are critical to London's success and play a significant role in our dynamic, active and vibrant economy not to mention the huge numbers of jobs they support.
"I am pleased that the European Commission recognise that although London is a global financial hub, we still need the ERDF to help support our entrepreneurs - and never has the need for such a stimulus been so great."
