Global partnerships for global challenges

By Roger Gifford, Lord Mayor of the City of London, who will visit Peru on 10 July. – Article written for Peruvian newspaper “Gestión”

I am looking forward to visiting Lima on 10 July because Peru is a country I hear being talked about increasingly often in the City of London. With good reason its stellar economic performance over the past decade and its reputation as a bright spot at a time of widespread financial difficulties are attracting international attention. So too is the ambition it is showing on the global stage – as a proactive member of the quickly developing Pacific Alliance, as meeting place of the World Economic Forum on Latin America in April this year, and as host of the 20th session of the Conference of the Parties to the UNFCCC in 2014, to give just three examples.

The “inPERU” visit to London at the end of May by Finance Minister Luis Miguel Castilla and the delegation of senior Peruvian business leaders that accompanied him also made a real impression. The fact that an international group of 500 or so delegates enrolled to learn more about investment opportunities in Peru speaks for itself. As I see it, the fact that London is one of the world’s greatest financial centres where financial institutions and leading professionals from around the globe come together is one of its major strengths.

The advance of technology means that business decisions are taken across borders every day and are frequently implemented in seconds at the click of a button. I am proud that the City of London has risen to the multiple challenges of globalization over the past twenty years and has consolidated its position as a world leading financial services hub. It deserves the international recognition it gets as a leader in asset management, infrastructure financing, insurance and legal services.

As well as being a place where the international financial world comes together, London is a place where companies from around the world come together, be it through the London Stock Exchange or through organizations like the London Metals Exchange, the International Coffee Exchange and the World Gold Council. Investments by London listed companies make the UK one of the largest investors in Peru today.  Several companies with London listings operate in Peru. In total the shares in nearly 700 foreign companies from over 60 countries with a combined market value of £2.05 trillion are traded on the London Stock Exchange today. They are drawn to the market for different reasons: reputation, high standards of corporate governance, clustering of financial and professional services providers, access to international capital, liquidity, sector strengths (for example in mining and metals), timezone, the English language and legal system.

In London we are of course feeling the impact of the global financial crisis. Britain is at the centre of the European Union but is not one of the group of European countries that uses the Euro. Even so, the Eurozone crisis is something we are feeling keenly – this group is our single largest export market. The City is supportive of Prime Minister David Cameron’s push to encourage structural reform of the European Single Market to ensure it is fit to compete in today’s globalized world. Britain and the other member states of the European Union need to be addressing the structural problems that have led to an increase in unemployment and a reduction in growth in recent years.

In the UK we share the Peruvian government’s view that investment in high quality infrastructure drives economic growth. We saw it in London with last year’s Olympic Games – public-private partnerships delivered complicated projects on budget and ahead of schedule.  London is investing in a new cross-city railway; a project involving similar skills sets to those that will be needed to build the new Lima metro. The Peruvian government is right to be working hard with the private sector to attract the massive investments it needs to fund projects in infrastructure and in the mining and hydrocarbons industries.

Today’s national challenges require public-private collaboration. Today’s global challenges require global partnerships. London, with its multiple connections to Peru that go back almost two hundred years, was the right place for the inPERU mission to return to in May this year. I am delighted they did so and know that they will be welcomed back again. I look forward to using my visit to contribute to building the sort of partnership between Peru and the UK that will continue to serve as a model for years to come.