London stands out uniquely as the capital city of a medium-sized state. None of the other capitals holds or has held the status of London in international politics. This perhaps reflects the preeminence of England in the growth of the West from its move to a dominant commercial position, its secure leadership of European international society towards the end of the seventeenth century, and the independence of London from formal subordination to formal political hierarchies of world historical significance. The continuing consequence is the virtual absence of any parallel use of English national greatness for other classes in society; there has been no Masaccio, no Nobel, no Bessie Smith to rail against the oppression which national greatness has imposed upon them.
Today, the rest of England is still waiting for its turn. All of these features derive substantially from the particular economic development of Europe, which sets London apart from other contemporary centers of political independence. Furthermore, they suggest that a middle-ranking status as a power in a society of many independent units is the most suitable position for a great international prize such as London to occupy. The larger the number of like units, the more powerful an international status that London is likely to be, while the less an international system depends upon any one unit, the more it values the power which independence can offer. The fundamental question is why national and city power are related. Why does London have the capability to play a larger and more successful role in international politics than its involvement in the domestic political life of the English state would seem to warrant? What is the relationship between the outward appearances of deference for the political supremacy of nation-states and the economic power of international cities in a society of sovereign states?
Global Financial Hub
London is a global financial hub. Its financial district, the City of London, is one of the largest in the world. The City handles a share of about 40% of global currency transactions. It is home to some of the world's largest banks, and the London Stock Exchange is the largest in terms of market capitalization. In addition, the influence of powerful financial companies, such as hedge funds and private equity firms, extends well beyond the geographic boundaries of the City.
However, this concentration of finance is in this case a relatively recent phenomenon. It is generally considered that the first step toward this status was initiated in 1986 with the so-called "The Big Bang," when the UK government deregulated financial markets by abolishing the separation of private banks. Since then, the United Kingdom and London have focused on intensively promoting financial business, capitalizing on the advantages of time zones, language, regulations (due in part to the absence of a single European regulator), and the quality of human capital.
Furthermore, financial companies value the ability to conduct business without interference. This is why one of London's main attractions has always been the perception of its absence of corruption and nepotism, as well as the independence of its judicial system. As a result of these decisions, London not only became a European investment center, but managed to increase its presence at the global level. The largest British banks went on corporate acquisition, expanding into other countries, in processes that were not always free from skepticism. In addition, the British government implemented several measures to attract not only financial investors but also entrepreneurs, thus creating conditions for the transfer of foreign capitals. This was not worth selling companies in sensitive areas such as defense or technological aspects, but all other sectors were subject to lenient controls.
Diplomatic Center
More than 180 foreign embassies and high commissions operate in London, more than in any other capital. No middle power can match this diplomatic presence, as many aspects of international diplomacy require a local network. More importantly, London's diplomatic role underpins the giant strength of English-language media and culture. The United States and Canada, who are represented in almost every other capital, also maintain sizable missions. They were both, after all, once part of the British Empire. American policy is based on strong direct links with individual nations and the United States vigorously pursues its global interests in London, rather than a backwater.
But the British Foreign Office, virtually created in response to the Treaty of Utrecht in 1713, remains a dominant player, both in Whitehall and internationally. The Ministry of Defence and a number of under-secretaries coordinate state and defence policies, also thinking about the British role in the world. The British Government hosts the most important international institutions, such as the Commonwealth Secretariat, and charities. International corporations and NGOs include Amnesty International, Greenpeace, the International Maritime Organization and the International Transport Federation. Consultants, such as the Centre for European Reform, the International Institute for Strategic Studies and the think-tanks involved with the Royal Institute of International Affairs, Spectator or The Economist, are based in the city.
London also provides a home from home for political exiles and international fugitives, including oligarchs, gangsters and convicted Pakistani politicians. It typically serves as a neutral venue and the city acts as a fine money-laundering, security and travel point. Candidates with serious illnesses, whether political, causes and voluntary, also can often find attention from the capital's leading British, European and foreign doctors.
The Role of Embassies
In London, there are 166 missions of which 130 are embassies and 170 high commissions. The latest embassies to be opened in London represent Montenegro in 2006 and Kosovo in 2008. The number of embassies in London ensures that the United Kingdom is in a very powerful position as it can strengthen its communication links with the wider world. As well as gaining an overview of conditions in other countries, the global perspective becomes more meaningful as other countries' policies and problems become clear.
The UK can also use its embassies as a means of changing the policy, economy, and society goals of other countries. The United Kingdom will have more information available on nearby states than they on the United Kingdom, which is an advantage in international politics. The United Kingdom possesses the oldest permanent diplomatic service and all its missions have a multifunctional character. The service contributes to the country's security, prosperity, and ability to protect both its citizens in other parts of the world and its own territory from terrorism and hostile countries.
Embassies gain much knowledge of the workings of other countries, especially those they are accredited to, although of course, not all missions are the same. Some function as field offices, others look after visas and trade questions and give consular advice. British embassies take on a limited role in policy coordination but consuls cannot make unlimited commitments to British residents living overseas, yet, at the same time, the staff of embassies are required to operate within an extremely tough budget. Small posts will struggle in getting to represent entirely the Government and individual embassies can focus on economic activity with trade attachés and defense staffs as well as public diplomacy and development posts that have the mandate of taking Britain forward for the global challenges of the 21st century.
Global Security and Defense Policies
As a more concrete form of Washington's influence over the military defense of the allies, could be the deployment of the Reassurance, Atlantic Resolve, and Deterrence Operation initiatives in the Eastern European region. These are carried out by the United States members, the funds are covered by the United States, and the activities are planned and executed by the United States.
This testifies that if the debate on the United States positively covered the European region in terms of the military security of the European states, Europe would still be so from the United States. As a result of the United States' initiatives, discussions are at the eastern borders today, but the greatest threat to the European continent in terms of security primarily lies in the southern and southeastern borders.
London has developed a more foreign defense policy in recent years, recognizing the increasing importance of the European Union in its international activities. In the context of its bilateral relations with foreign policy and the Member States, it recognizes the ratio of activities with the Union as a synergy. The most concrete form of its European Union policy in the military field is the development of the NATO-EU cooperation, which includes the determination of the London governments at a high level.
Britain emphasizes the development of cooperation in joint preventive diplomatic conflict management, military capacity building for the military planning processes, global military capacity building for asymmetrical threats, and in crisis management and response. By disengaging as much as possible from Europe both politically and as a matter of defense, the question is what contribution London will make in the future of European security. And in light of this approach, the question arises of whether it has become one of the countries with greater influence in global security.
The attitudes and preferences of the transit state are crucial in determining policies. The most direct way of measuring power is the capacity of coercion itself, and the lack of influence also means the lack of power. Non-state-centered studies have no place in the literature. As we set out, member states have been transcending traditional classic sovereignty attributes over the past decades and have been asymmetrically shared with a higher order. The previously relatively independent member states are effectively binding in areas that are shared with the EU, which they themselves can influence at a lower level of participation.
London has already tried to show how member states, but only in particular areas, shift power to a substantially greater level of involvement, so that the member states have the potential to manipulate the level of involvement as well. For some countries, it is possible for them to influence the agenda and ensure that their preferences are put into effect more difficult. In some way, one of the surest ways to make the right of conducting and setting the agenda stronger is institutional integration and operationality of the EU, but attention must be kept clear that this is a long-term process.
International Organizations
London, which historically played a major role in the formation of the main international organizations, continues to play an important role within them. It is home to the secretariats of the main intergovernmental organizations: the Commonwealth and the International Maritime Organization. The headquarters of Interpol is also in London. It also houses major institutions of other organizations such as the European Bank for Reconstruction and Development, whose members include most of the leading countries in democratic Europe.
It provides important services such as the secretariat of both the International Chamber of Shipping and the International Sugar Organization. In many cases, the permanent representation in London of the various countries has acquired a certain efficiency, which is reflected in the frequency with which Britain is called on to play roles related to its membership in the European Union or to undertake special functions on behalf of delinquent countries such as relations with the relevant international organization.
London has also been a pioneer in the promotion of informal multilateral action, recognizing that, especially in fields such as international currency and economic cooperation in which the country has interests, recurrent meetings are important to take into account the changes in the economic structure and the relative powers that occur. The meetings of the financiers of the G-10 (the group of main industrialized countries) had value in the interaction and consensus between the leaders of countries such as Germany and Japan on monetary or financial policies.
London has also sometimes been the host of informal peace talks, as well as applied alternative financial solutions such as negotiations between large British banks and companies in crisis or debt conversion operations. The London approach has often influenced the activities of international organizations.
As a permanent member of the United Nations Security Council, London is called upon to handle a special set of issues within the Secretariat. It is the most important capital of this international body after Washington, and a large part of its diplomatic personnel deals with issues related to the organization. This is done either through the British delegation in New York or the British mission to the United Nations in Geneva. There is a permanent representation to the International Atomic Energy Agency (IAEA) situated in Vienna, and most key UN bodies have a directly engaged London embassy staff.
It was adapted to the rise of other agendas. For the better part of the post-war period, development policy formed a major part of Britain's foreign policy. London was the UN's first bureau for coordinating international aid activities, and its national aid committee formed into a permanent Department for International Development (DfID) in 1997. As the UN's unique features have become more evident since the 'performance paradox' of the 1980s, so that this 'special' relationship has passed through four stages. Within the adaptation that was involved, Britain has developed a particular role within the UN as a 'penholder' on certain issues that require UN action.
Future Prospects
London has long been associated with international diplomacy, particularly since the formation of the state-based international order in the 17th century. Its landscape is adorned with symbols of the city's claim to diplomatic legitimacy, and despite decolonization, its ties and links with scores of foreign governments probably exceed those of other world cities.
Despite the Cold War and the loss of empire, London remains a major center of international politics, a forum for diplomacy at a number of levels. Even so, the role and influence of the United Kingdom (UK) and its capital within the diplomatic range in world politics seems to be declining. Although many international organizations still provide for large expatriate communities, the cost, constraints, and competition of other cities cast some doubt over London's position in the future world diplomatic city system.
Diplomatic legitimacy and the most visible of diplomatic transactions of the modern state-based system, the bilateral mission. The early sections concentrate largely on the nature and form of diplomatic relations in the modern world city system. In effect, this represents the primary output of diplomatic activity, the place where policy is put into practice. Next, there is an account of London's place in these arrangements, based on an index drawn from the most recent entries of the Year Book of International Organizations. Finally, there is a summary of the issues raised. In particular, what dividend is gained from being a world capital housing a prominent and influential diplomatic presence, and what is its "cost" to the host country?
