Europe and the United Kingdom have not yet negotiated a financing agreement that would allow anything like the pre-Brexit status quo.
Photographer: Hollie Adams / Bloomberg
Photographer: Hollie Adams / Bloomberg
It is unlikely that the European Union will grant the United Kingdom equivalence in financial services, with a divergence between the two “the most likely scenario” in the coming years. Goldman Sachs Group Inc. advisor Jose Manuel Barroso said.
“I personally believe that there will be no permanent equivalence decision by the European Union with regard to financial services,” Barroso said Thursday at a Moody’s Investor Services webinar. “It’s more or less inevitable, irreversible, a trend of progressive divergence,” he said.
The comments by Barroso, who led the European Commission for a decade until 2014, underline the hard line the EU has taken so far. Europe and the United Kingdom have not yet negotiated a financing agreement that would allow anything like the pre-Brexit status quo. The talks, which will end in March, focus on a path to cooperation and are of mainly symbolic relevance, while no decision on equivalence is likely to arrive soon.
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“It is clear” that the EU wants more business to move from London to the eurozone as a result of Brexit, Barroso added. The bloc wants the “dislocation” of some capital, people and “UK risk management in the euro area and the European Union in general,” he said.