Brexit effect: Amsterdam displaces London as Europe’s top share trading hub – THE WEEK

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Business lost in London has been picked up in the Netherlands: €9.2 billion worth of shares were traded in Amsterdam exchanges in January vs 8.6 billion in London. Amsterdam, effectively, has surpassed London as the largest share trading centre in Europe.

The data was compiled by the Cboe exchange which operates in both countries. Amsterdam’s edge may end up being temporary, as this month, trading in Swiss shares was allowed to resume in Britain, which itself averages around €250 million a day, and may go up to a billion a day according to Reuters.

Part of the upset is due to Brexit rules preventing EU banks from buying European shares via London exchanges. Both sides plan to hold talks over an “equivalence” regime that would recognise each other’s financial regulations. But the damage may already have been done: Nearly 100 per cent of European share trading had already moved out of London by January 4, Bloomberg reported. London, the world’s biggest interest-swap trading centre, has lost out of large chunks of euro-dominated interest-swaps, according to data from IHS Markit.

There is scope for the UK to expand beyond Europe though: Prime Minister Boris Johnson’s government announced on January 31 that the UK would be applying to joing the Comprehensive and Progressive Trans-Pacific Partnership (CPTPP), one of the world’s largest free-trade areas made up of 11 developed and emerging economies in the Pacific, under its post-Brexit plans.

In addition, a European Commission report estimated that Brexit would harm the UK much more than the EU: Costing up to 0.5 per cent of the EU’s GDP by the end of 2022, but up to 2.25 per cent of the UK’s GDP in the same time.

Joining the CPTPP reflects the UK’s post-Brexit Pacific tilt and is dubbed as a critical part of the Prime Minister Boris Johnson led government’s wider trade strategy, which aims to deepen links with faster-growing parts of the world and partnering with countries who believe in free and fair trade, including India.

The decision to join the CPTPP, comprising Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore and Vietnam, marks one year since the UK left the European Union (EU) on January 31 last year and entered a Brexit transition period which concluded at the start of this year.

“While the FTA [free trade agreement] improves the situation as compared to an outcome with no trade agreement between the EU and the UK, it cannot come close to matching the benefits of the trading relations provided by EU membership,” the commission said.