London's Economy and the EU

MQT on 2016-05-25
Session date: 
May 25, 2016
Question By: 
Fiona Twycross
Labour Group
Asked Of: 
The Mayor


How does continued membership of the EU deliver economic benefits to Londoners and the capital's businesses?


Answer for London's Economy and the EU

Answer for London's Economy and the EU

Answered By: 
The Mayor

Sadiq Khan (Mayor of London):  Thank you, Chairman.  Thank you, Assembly Member Twycross.


I would first of all like to note that this is my first Mayor’s Question Time and it is appropriate that my first question and many others during this session relate to the most pressing and important issue the capital and the country faces: the European Union (EU) referendum.  The weight of Assembly Members’ questions today reflects how vital this issue is to the Londoners whom you and I represent.  I will be campaigning to remain in the EU and I hope Londoners agree with me and also vote to remain.  I urge people to find out how to register, make sure they are registered by the deadline - 7 June 2016 - and get out the vote on 23 June 2016.


In answer to your specific question, the EU is vital to London’s economic success.  It has been estimated that over half a million London jobs were associated with trade with the EU and a third of London’s business branches - 141,000 - sold goods and services to the EU.  Overall, 44% of the UK’s exports are to the EU, far more than to any other region of the world.  London’s businesses do not want to leave the EU and 81% of large companies are in favour of remaining.  We must not give up now on the economic prize of an EU single market for services, which will open up Europe to London’s strengths, attract new companies and enable entrepreneurs and established firms to sell across the Continent and its more than 500 million consumers.  Consequently, it has been estimated that London’s economy might generate an extra 75,000 jobs by 2030.


There are many other benefits from our collaboration with the EU.  For instance - something that I know you care about passionately - students from London are able to study overseas on the Erasmus Programme and London’s higher education (HE) sector is benefiting from EU students here.


Fiona Twycross AM:  Thank you.  I would like to join other colleagues in congratulating you on your election.  For those of us who recognise how supportive our city is of the EU, it is no surprise that a pro-EU candidate succeeded in the election.


I would like to expand a little bit on the issue of jobs and the risk to jobs if we leave the EU.  We know that over half a million jobs in London are associated with the EU and that London has effectively become the gateway to Europe.  Of the world’s 250 largest companies, 40% have their European headquarters here in London and 60% of the top non-European companies have their headquarters in London as opposed to other parts of the EU.


What risk to jobs is posed by us leaving the EU?  What impact would that have on Londoners’ jobs?


Sadiq Khan (Mayor of London):  The Prime Minister [The Rt Hon. David Cameron MP] and the Chancellor [The Rt Hon. George Osborne MP] have been talking about the conversations they have had with leading businesses in London and around the country.  During the last year I have been speaking to businesses across London and they are concerned about the consequences of us leaving the EU.


Last week one of the visitors I had invited to City Hall was the former Mayor of New York, Mike Bloomberg, and very shortly he is opening a fantastic new building in London, which will employ, according to him, more than 4,000 Londoners.  They have already employed lots in London.  This will be the European headquarters.  It will be in London.  The point he made to me was: why would they have chosen London as the European headquarters if London was outside the EU?


I would just remind colleagues that the gross domestic product (GDP) of the EU is larger than China and is larger than the United States of America.  During the course of the campaign I met with multinationals, I met with large companies, I met with the Confederation of British Industry, I met with London First and I met with many, many others.  What is remarkable about our great city is that some of the world’s leading companies have their European headquarters located here in London.  Think of Sony; think of AIG Insurance; think of China Telecom.  There is a positive case for remaining in Europe.  However, it is right that the Governor of the Bank of England and others are just expressing concern about the consequences should we leave the EU.


Fiona Twycross AM:  Thank you.