Lloyd Blankfein doesn’t do Twitter often, but when he does, he does it good.
The Goldman Sachs CEO indulged in some sharp trolling of the U.K. Government Thursday, with an implicit threat to move a big chunk of his business away from London to Germany if it doesn’t get cut a deal soon with the EU over the terms of Brexit.
Just left Frankfurt. Great meetings, great weather, really enjoyed it. Good, because I'll be spending a lot more time there. #Brexit
— Lloyd Blankfein (@lloydblankfein) October 19, 2017
“Just left Frankfurt. Great meetings, great weather, really enjoyed it,” Blankfein tweeted, setting himself up the punchline: “Good, because I’ll be spending a lot more time there.”
Goldman signed a lease on around 100,000 square feet of office space in Frankfurt two weeks ago, a move that it admitted was motivated in part by the fear that it could have to relocate hundreds of jobs to other centers in the EU when U.K.-based banks lose their (currently unlimited) access to the European market in March 2019.
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“This expanded office space will allow us to grow our operations in Germany to continue serving our clients, as well as provide us with the space to execute on our Brexit contingency plan as needed,” the London Evening Standard quoted a Goldman spokesman as saying at the time.
Blankfein’s intervention comes at a particularly awkward time for British Prime Minister Theresa May. The EU is refusing to talk about trading arrangements post-2019—including market access for the U.K.’s huge financial services industry—until “sufficient progress” is made on agreeing a financial settlement for the U.K.’s remaining obligations. Talks on a settlement broke down last week.
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May had proposed a two-year “implementation phase” in a speech in September that would effectively have left the current rules in place until 2021. She implicitly attached a promise of 20 billion euros—in line with the U.K.’s current contribution to the EU—to that offer. However, it still met with a frosty reception from EU officials.
Her room for maneuver is limited on both sides: she can’t offer the EU more generous terms without enraging the right-wing of her party, which believes that the EU can be pressured into a better outcome, while the centrist wing of her party is equally opposed to a “no-deal” Brexit that would reintroduce customs checks and import tariffs overnight, while leaving the whole legal basis for trade in services in limbo.
