By Elena Vasquez

The City of London Corporation supports Prime Minister Burnham’s push for closer UK-EU ties as EU banks now do 60% more business with UK institutions than they did before the referendum.

Chris Hayward, the corporation’s policy chairman, called Burnham’s approach “entirely correct.” “The Prime Minister is entirely correct to be seeking to build on our relationship with closer ties with the EU,” he wrote, adding that the bloc remains Britain’s largest trading partner and that lower barriers could unlock growth.

The City has proved remarkably resilient despite significant change in UK-EU relations over the last decade, Hayward said. He described London as the world’s leading financial centre and said the City’s workforce had grown 25% to almost 700,000 jobs.

Politicians must determine the form of any new relationship. The City’s stated objectives are to unlock investment, support innovation, strengthen sustainability and deliver prosperity, Hayward said, with the existing UK-EU relationship providing a strong base for further gains.

What does closer EU cooperation require?

Hayward identified three reforms needed to turn political intent into easier business:

• Mutual recognition of professional qualifications, which would make it easier for businesses to access talent.
• Greater certainty over data arrangements, which would support digital trade and innovation.
• Closer regulatory cooperation to reduce duplicated compliance and ease cross-border investment while maintaining high standards and financial stability.

How significant are the UK-German ties?

During a trip to Germany last week, Hayward met the Federal Chancellery, the Federal Ministry of Finance, members of the German Parliament, the Bundestag and representatives of the German financial-services industry.

He reported mutual recognition of the growing importance of UK-German relations and cited their joint support for Ukraine. Germany ranks as Britain’s second-largest sovereign trading partner, while Britain ranks third among Germany’s trading partners outside the EU.

Bilateral trade exceeds £149bn a year, with about one quarter of the total in services. Hayward said the relationship remains strong but has substantial potential, particularly because much of Europe’s economic policy takes shape in Germany.

What does the Kensington Treaty change?

The UK and Germany recently ratified the Kensington Treaty, the first ever legally binding bilateral treaty between the two countries. Hayward said the City of London strongly welcomed the agreement and urged both sides to use it to deepen ambitious cooperation focused on prosperity, growth and innovation.

What can the 20 November summit deliver?

The UK-EU Summit on 20 November offers an opportunity to convert political goodwill into practical economic gains across the bloc, according to Hayward. He placed financial and related professional services high on the agenda, backed by London’s role in connecting European companies with international investors.

Closer regulatory cooperation could also reduce unnecessary duplication and make cross-border investment easier without lowering standards or weakening financial stability.

Where does regulation threaten investment?

Hayward warned that new barriers could restrict the investment Europe needs. “Europe needs capital to strengthen its energy security, expand its defence capabilities and support businesses with the ambition to grow,” he said.

He singled out the EU’s Capital Requirements Directive, or CRD VI. In its current form, the directive would make it harder for British banks to support businesses on the continent, limiting capital that could finance European growth and resilience.

Why must London remain competitive?

London can meet part of that need through financial markets that give European companies access to international investors. Hayward also identified British expertise in insurance, technology and sustainable finance as tools for supporting projects across the continent.

That proposition depends on investor confidence that Britain remains a stable base for businesses seeking to establish operations, raise capital and plan over the long term. Hayward cited the UK legal system, rule of law, regulatory expertise, global talent and the international reach of its financial ecosystem as advantages.

Britain and Germany share an interest in a resilient European economy, Hayward said. Keeping financial services at the centre of the relationship, reducing friction where it serves both sides and giving investors certainty could create jobs, security and prosperity across Europe.

The 20 November summit is where Hayward wants political goodwill to become practical economic gains.