By Michelle Price
HONG KONG (Reuters) – Talks continue between the London and Shanghai exchanges over a potential stock link, despite Britain’s vote to leave the European Union, though it could affect implementation, a senior London Stock Exchange Group (LSEG) official said on Wednesday.
Speaking to Reuters at an investor meeting in Hong Kong, Brian Schwieger, head of equities at the LSE Group, rebuffed speculation that the proposed link, unveiled last year, could be derailed by a so-called “Brexit”.
“I can confirm we have touched base with our colleagues in Shanghai on this,” he said on the sidelines of the AsianInvestor LSEG Greater China Forum. “The discussions continue but we did bring up the subject.”
The two sides will continue to send teams to each others’ sites and on Friday reconfirmed a visit to Shanghai by the London team later this month, he added.
“So there remains very strong commitment,” Schwieger said, adding, however, “Now longer term, in terms of implementation, yes, we’ll have to wait and see for some of these uncertainties to be nailed down.”
Last week’s shock vote roiled global financial markets, driving the pound to its lowest in 31 years, despite government attempts to relieve some of the confusion about the political and economic outlook.
Britain now faces a long period of uncertainty, as the government begins a two-year process to renegotiate ties with the EU, which allows goods and services to be freely traded within the bloc.
Reuters reported over the weekend that Brexit threw into doubt a raft of UK-China financial services projects agreed as part of the China-UK Economic and Financial Dialogue (EFD) to deepen economic ties, based largely on Britain’s EU membership.
Schwieger said the LSE Group remained committed to its UK-China financial services partnership, with London remaining attractive because of its long-established diverse institutional investor base and international outlook.
“Clearly, the position of London as a financial centre is very important to the UK and Europe, and this will definitely be in the forefront of negotiators’ minds when they sit down and start having these discussions,” he said.
“The close relationship between London and China is a key example why operating as a financial hub is so important to the UK and EU economy, but also the UK’s position as a world power.”
(Reporting by Michelle Price; Editing by Clarence Fernandez)