The Corporation of London together with the London boroughs of Southwark, Newham, Tower Hamlets and Hackney are all devising schemes to extend the capital's Square Mile financial district and reclaim vast swathes of redundant industrial land. The Corporation of London, the City's local authority and principal landowner with assets in excess of pounds 4bn, has identified seven sites where it will allow skyscrapers.
The move represents a relaxation of the City's tall building policy and is aimed at countering Frankfurt's bid to become the financial centre of Europe. The German city recently announced plans to build 20 new skyscrapers in the next 10 years.
The Corporation's initiative also comes in response to the growing number of US banks and telecommunications businesses keen to locate in London.
Last week, it emerged that Chase Manhattan is choosing between Canary Wharf, a site next to London Bridge station and a cleared site near Fenchurch Street for a massive new 750,000 sq ft headquarters.
The Corporation's economic development officer, Christopher Wu, said: "The City knows of about 10m sq ft of requirements for firms making inquiries about the possibility of coming to the City. We have to be flexible and listen to what they want. If it's skyscrapers we'll do our best to deliver them."
The Corporation is also hoping to expand the City into neighbouring Aldgate, run by Tower Hamlets, and east of Spitalfields, run by Hackney.
Its moves come at a time when Canary Wharf is intent on developing an additional 5.2m sq ft of office space at its east London office complex.
Meanwhile in Newham, east of the City, a vast 1,200-acre swathe of mainly derelict and contaminated land - its length is the same as the distance from Regents Park to Parliament - is earmarked for the biggest regeneration project in Europe, called the Arc of Opportunity.
Newham council will choose an architect to draw up a masterplan at the end of the month. The council says the says the winner will have the chance to "translate new government policy directions into urban form and create the profile and momentum to achieve quality of transformation".
The council, which is run by Wendy Thomson - a member of the Government's Urban Taskforce who has secured pounds 156m of European and government money - believes its project could rival Canary Wharf.
A Channel Tunnel high-speed terminal and the Jubilee Line are coming to the borough, where 80,000 of the 220,000 population live on means- tested benefits. And it is close to the expanded London City airport and the M11 link.
But Newham will need to attract up to pounds 7bn if it is to achieve its goal of developing high-quality housing, hi-tech business clusters and imaginative leisure destinations.
Ms Thomson said: "In the Stratford railway lands area, there is already significant private-sector interest, The Thames area will attract interest with the Excel exhibition centre now happening there. So we have the motors in the north and south of the site."
Sandra Hunt, Newham's head of regeneration, said: "This is a once in a life-time opportunity for us to strip everything down and start again."