Labour Party's Rachel Reeves, shadow chancellor of the UK's Exchequer since 2021, has criticised the British economy's over-reliance on financial services. Photo: Reuters
London’s unique role in the international arena comes with major advantages and places the UK at the centre of global financial transactions, says John R Bryson, professor of economic geography at the University of Birmingham. Being the global face of British businesses, the sub-sector generated a trade surplus of roughly $105 billion in 2021—which was more than the combined surplus of all other UK industries that registered trade surpluses in that year, dataHe says government policy can do “very little” to diversify an economy. Economic activity does not occur out of context and always builds on a country’s existing strengths, he adds.
Bailing out banks becomes increasingly challenging if they outgrow their governments in size, as in Iceland and Ireland.