Trump official warns EU against 'forced relocation' of financial services from London after Brexit saying it could cause chaos

  • Christopher Giancarlo warned against bids to make businesses move post Brexit 
  • Said a forced relocation would have 'significant costs' to the EU's economy
  • Comes amid fears EU states will force lucrative clearing houses to move from UK
  • Theresa May is today traveling to Brussels to adres crunch summit on Brexit

A Trump official has warned the EU against the 'forced relocation' of financial services from the City of London after Brexit - saying it risks imperiling the economy.

Christopher Giancarlo, one of Donald Trump's most senior economic advisers, said a financial land-grab by France and Germany risks imposing 'significant costs' on business.

His stark warning follows fears that European countries could use Brexit to lure the lucrative financial services industry to relocate to their cities.

And there are also concerns Brussels could force 'clearing houses' for euros move to the continent.

The move would potentially deal an £80billion hit to the UK economy and put 80,000 jobs at risk.

Christopher Giancarlo, an economic adviser to the Donald Trump White House, said the EU should not try to force businesses to relocate from the City of London to the EU after Brexit as it will harm the economy (file pic)

Christopher Giancarlo, an economic adviser to the Donald Trump White House, said the EU should not try to force businesses to relocate from the City of London to the EU after Brexit as it will harm the economy (file pic)

Mr Giancarlo, chairman of the Commodity Futures Trading Commission, told The Daily Telegraph: 'Any forced relocation... to one or more EC member states has the potential to impose significant costs on the global economy, not just Europe, and fragment financial markets to the detriment of systemic resiliency worldwide.' 

The comments are a boost for Theresa May as she travels to Brussels today to appeal directly to leaders of EU countries to speed up the Brexit talks.

The Prime Minister will address a crunch summit of heads of the 28 member states in a bid to encourage them to finally agree to start trade talks.

The bloc has so far refused to move on to trade negotiations until the divorce bill is settled. 

But the PM has come under pressure from Brexit-backing MPs who today have written an open letter urging her to walk away form the talks if leaders do not agree to move on to trade talks at the summit. 

Theresa May, pictured leaving No10 today, is to travel to Brussels to directly appeal to EU member state leaders to move on to trade talks in the Brexit negotiations. She is under pressure form Brexiteers ti walk away form the talks if member states continue to refuse to move on in the negotiations 

Theresa May, pictured leaving No10 today, is to travel to Brussels to directly appeal to EU member state leaders to move on to trade talks in the Brexit negotiations. She is under pressure form Brexiteers ti walk away form the talks if member states continue to refuse to move on in the negotiations 

Mr Giancarlo's warning comes after the chief executive of the London Stock Exchange warned the EU risks triggering another financial meltdown if it punishes the City to make a 'political point' about Brexit.

Xavier Rolet said any attempt to seize back euro trading would lead to unacceptable 'systemic financial risk'.

He also appealed for quick clarity on a post-2019 transition deal, saying there was a risk jobs would start leaving the UK if businesses faced a 'cliff edge'.

He said: 'To those who want to dismantle rather than build on a system of global regulatory standards that protects taxpayers and reduces the cost of capital, we say: do not willingly diminish systemically important global financial market infrastructure just to make a political point.'

Mr Rolet also cautioned that regulatory systems 'cannot be replicated overnight' so businesses will simply make their own arrangements and move to the EU if they are not given sufficient notice.

'Businesses cannot risk a cliff-edge being so near before they start accelerating the migration of functions away from the UK to ensure they can participate in the global market,' he said.