London's role as one of the centres of the world financial services industry could be threatened if there is a protracted bombing campaign, some economists and business experts have warned.
Peter Spencer, economic adviser to the Ernst & Young Item club, an economic forecasting group, said there was a “real danger” that non-UK financial services businesses could be put off from investing in London should the recent bombing incidents turn into a concerted campaign.
Mark Pragnell, managing director of the Centre for Economic and Business Research, a consultancy, said London's role as a key recipient of foreign capital much of this directed towards banking and other financial services “could be hit” if the series of bombs turned into something longer-lasting.
But he said “we are still some way” from an imminent threat to investment. Of more immediate concern, he said, was that anxieties linked to the attacks could damage areas of the economy, such as tourism and retail spending.
“Retail spending has been looking pretty weak in the past few months and the bombs in London are bound to depress this part of the economy further,” said Mr Pragnell.
But John Lewis, the store chain, and the Harrods department store, both said the number of shoppers in their London premises at the weekend was only slightly down from normal levels. Mike Moriarty, a UK-based business expert at AT Kearney, a US business consultancy, said unless the spate of bombings in London continued, the overall economic impact would be “minor”.
Asked whether she would still visit the capital's shops and museums despite the added risk, Kim Zielinski, a 27-year medical assistant from the US had no doubts. “Hell yeah,” she said.
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