Nigel Farage has criticised efforts by UK ministers, including Chancellor Jeremy Hunt, to attract Chinese-founded fast-fashion retailer Shein to the London Stock Exchange, asserting that it would not bolster the market.
Farage contends that Shein’s potential £50 billion listing will not enhance London’s financial prestige. The retailer has faced accusations of forced labour in its supply chain, which it denies. “Encouraging Shein to choose London would be a mistake,” Farage stated, adding that it “won’t change the IPO crisis in the City.” He continued, “They see an IPO for Shein and say, ‘Oh isn’t that marvellous because London needs it’. No, it doesn’t. It doesn’t at all. Saying no to Shein is not cutting off our nose to spite our face. It’s saying we think this is a very bad idea.”
Farage, the parliamentary candidate for Clacton, attributes the London Stock Exchange’s struggles to “excess regulation” and calls for a “radical rethink of the financial market rules.” His assertion highlights the continued adherence to EU regulations, impeding the potential for a more dynamic financial landscape. Meanwhile, Shein has been preparing for a London listing after earlier plans to float in New York were thwarted by political opposition. The company, now headquartered in Singapore, is working on the necessary paperwork for a potential blockbuster listing, although this does not ensure it will ultimately choose the UK market.
Both major political parties in the UK have shown support for Shein listing in London. Labour MPs recently met with the retailer, affirming that “raising investment, productivity, and growth is one of Labour’s missions for government.” In addition, Jeremy Hunt held discussions with Shein’s executive chairman Donald Tang in January, attempting to persuade the retailer to opt for London.
Shein has grown swiftly to become one of the largest fashion retailers globally, known for its rapid product launches. There are concerns regarding how it can afford to charge such low prices, with some items retailing for as little as £4. In April, US Senator Marco Rubio stated that there was a “high probability these companies have facilitated the importation of goods made with forced labour.” These concerns focus specifically on Shein’s Chinese supplier base, particularly given that much of China’s cotton comes from Xinjiang, where there are allegations of forced labour involving Uyghurs.
Last week, Peter Hugh Smith, chief executive of CCLA Investment Management, warned that allowing Shein to list in London would risk the City becoming a “listing venue of last resort” for companies with questionable human rights records. Smith added that government support for a Shein float “sends the signal that the UK is willing to overlook significant human rights concerns.” A spokesperson for Shein responded, “Shein has a zero-tolerance policy for forced labour and we are committed to respecting human rights. We take visibility across our entire supply chain seriously and require our contract manufacturers to only source cotton from approved regions.”
The debate surrounding Shein’s potential listing on the London Stock Exchange underscores broader concerns about financial regulation, human rights, and market integrity. While political and financial stakeholders express differing views, the ultimate decision remains uncertain.
