London is a major centre for international business and commerce and is the leader of the three "command centres" for the global economy (along with New York City and Tokyo). London is the world's second largest financial centre after New York and has the 6th largest city economy in the world, larger than Osaka but smaller than Paris. As Europe's second largest city economy, year-by-year London generates approximately 20% of the UK's GDP (or $446 billion in 2005); while the economy of the London metropolitan area (the largest in Europe) generates approximately 30% of UK's GDP (or an estimated $669 billion in 2005.)

London shifted to a mostly service-based economy earlier than other European cities, particularly following the Second World War. London's success is as a service industry and business centre.

This can be attributed to factors such as English being the lingua franca, its former position as the capital of the British Empire, close relationship with the U.S. and various countries in Asia. Other factors include English law being the most important and most used contract law in international business and the multi-cultural infrastructure. Government policies such as low taxes, particularly for foreigners (non-UK domiciled residents do not get taxed on their foreign earnings), a business friendly environment, good transport infrastructure, particularly its aviation industry; and a deregulated economy with little intervention by the government have all contributed to London's economy becoming more service based. Over 85 percent (3.2 million) of the employed population of greater London works in service industries. Another half a million employees resident in Greater London work in manufacturing and construction, almost equally divided between both. There has been a significant fall in the number of people working in manufacturing industries in London over the last three decades, largely as a result of competition from lower cost regions but also as a consequence of technology and process improvements. Even still, there are more than 15,000 manufacturing businesses in London such as clothing, printing, fabricated metal, furniture and wood/products and food and drink. There is also strong growth in the recycling/environmental sector. A strong manufacturing base still thrives in London because of its geographic location and access to huge markets, its large science and knowledge base, its physical assets, its diversity and its role as a centre of design and creative industries.

London's largest industry remains finance, and its financial exports make it a large contributor to the UK's balance of payments. Over 300,000 people are employed in financial services in London. London has over 480 overseas banks, more than any other city in the world. More funds are invested in the City of London than in the next top ten European cities combined, and more international telephone calls are made to and from London than any other point on the planet. The City is the largest financial and business centre in Europe and, has recently begun to once more overtake New York City, partly due to strict accounting following the Sarbanes-Oxley Act and a tightening of market regulations in the United States. The Mayor of New York Michael Bloomberg has said that New York risks losing its title of world financial capital to London because of Britain's more easy going regulatory, legal and immigration systems.

London is home to banks, brokers, insurers and legal and accounting firms. A second, smaller financial district is developing at Canary Wharf to the east of the City which includes the global headquarters of HSBC, Reuters, Barclays and many of the largest law firms in the world. London handled 31% of global currency transactions in 2005 - an average daily turnover of US$753 billion - with more US dollars traded in London than New York, and more Euros traded than in every other city in Europe combined.

More than half of the UK's top 100 listed companies (the FTSE 100) and over 100 of Europe's 500 largest companies are head quartered in central London. Over 70% of the FTSE 100 are located within London's metropolitan area, and 75% of Fortune 500 companies have offices in London.

Along with professional services, media companies are concentrated in London (see Media in London) and the media distribution industry is London's second most competitive sector. The BBC is a key employer, while other broadcasters also have headquarters around the city. Many national newspapers are edited in London, having traditionally been associated with Fleet Street in the City, they are now primarily based around Canary Wharf. Soho is the centre of London's post-production industry.

Tourism is one of London's prime industries and employed the equivalent of 350,000 full-time workers in London in 2003, while annual expenditure by tourists is around 15 billion. London is a popular destination for tourists, attracting 27 million overnight-stay visitors every year, second only to Paris.

From being the largest port in the world, the Port of London is now only the third-largest in the United Kingdom, handling 50 million tonnes of cargo each year. Most of this actually passes through Tilbury, outside the boundary of Greater London.

additional information from Wikipedia

12/18/07 by visitEarth
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