London’s prescription for financial growth? Open up.
Addressing an assembly of businesspeople and journalists in the Nile Hilton yesterday, Lord Mayor of London David Lewis said that to become a major financial hub, Egypt must stay friendly to international investors and workers.
“You must encourage foreign lawyers, foreign accountants and foreign bankers to come here, he said. This means setting aside fears that policies of openness will cut into local jobs in an economy where unemployment is formidable.
“The evidence suggests the cake will get bigger, he said. “But you have to take the risk.
As a model, Lewis cited the policies of Margaret Thatcher, a famously conservative prime minister of the United Kingdom. Thatcher’s affinity for the laissez-faire brand of economics, advanced by Austrian School thinkers like F.A. Hayek, led her to reduce the state’s role in many parts of the British economy throughout the 1980s.
“Twenty years ago we were struggling; we were in decline, Lewis said. Then came “the Big Bang, a package of reforms aimed at the London stock exchange that notably allowed foreign banks and financial companies to take part on an unprecedented scale.
“The morale of that is the more you liberalize your economy, the more it will grow.
Lewis said the sovereign wealth funds, massive state-owned pools of investment assets, are important to emerging global economies despite the concerns of countries like Germany, France and the United States.
“We in London do not share their view, he said. “We welcome [SWFs].
Lewis cited the DP World controversy as an example of the hypocrisy strict protectionism can breed. In February 2006, a national security debate erupted in the United States when DP World, a Dubai-owned firm, tried to buy a British company that controlled six American ports. The US Congress voted to delay the deal until the DP World agreed to sell the ports.
“But when Citibank needs a bailout, where does the money come from? The Middle East and the Far East, Lewis said. “We don’t understand this at all.
Lewis also mentioned the recent success of Sharia-compliant mortgages and loans in both the UK and Muslim countries like Malaysia. The UK hosts 24 banks that offer Sharia-friendly services, due largely to the nearly two million Muslims working there, he said.
Lewis is the 680th person to hold the title of Lord Mayor of London, a one-year, largely ceremonial position extant since the 12th century. The job involves over 100 days of travel on goodwill missions throughout the world.
Yesterday Lewis met with Prime Minister Ahmed Nazif to discuss bilateral relations. His current tour will also include Libya and Jordan.
Lewis’s position is not to be confused with the Mayor of London, who governs a larger area. “I am not Ken Livingston, Lewis said in his introduction, referring to the current Mayor of London. “He’s rather shorter than me.
