LONDON (Reuters) - The City of London needs a watertight Brexit transition deal by the year-end for banks to plan ahead and avoid a “cliff edge” hurting the economy, the financial district’s mayor will say.
Lord Mayor of London Andrew Parmley will tell the annual City Banquet on Wednesday evening that government backing for a transition deal of about two years between leaving the European Union and the start of new trading terms “will be our bridge to the future”.
“But the idea must become reality, translated into a legal agreement before the end of the year,” Parmley will say in remarks released in advance to the media.
“The longer this is left, the more it damages all our futures – not only in the UK, but the economy right across the EU.”
Parmley, who holds the ceremonial post of mayor of the municipal authority that oversees London’s financial district, will say the financial sector needs to know more about the “final state” or future trading terms with the EU.
“How can the UK’s most profitable industry be expected to programme its satnav without knowing the destination?”
Banks in London are already announcing they will move some staff and activities to the EU before Britain’s departure from the EU in March 2019 to be sure of serving European customers.
Parmley criticised “economically illiterate calls” of those who want to put up cross-border barriers - Britain opposes plans by Brussels that could force the clearing of euro-denominated trades to move from London to the EU after Brexit.
The banquet in the “Square Mile” will also hear speeches from the heads of the Financial Conduct Authority, and the Bank of England’s Prudential Regulation Authority.
Parmley will say there is a need to maintain existing financial rules, remarks that will take a swipe at those who have suggested Brexit could be an opportunity to ditch some EU-originated regulation to improve competitiveness.
Reporting by Huw Jones; Editing by Edmund Blair