UK plans for a probable post-brexit slump in industry
The government is readying to tackle post-brexit slump in industry
The UK is preparing for the future – to face brexit in a strong way – in a way that will ensure a strong and global Britain in the future. As part of efforts to do so, it is set to renew its industry policy in which the government will intervene in industry, a policy that was abandoned since the times of Margaret Thatcher in the 1980s, to make sure that the country’s industry does not lag behind during the tumultuous times following the UK’s official exit from the EU.
The step by the government is intended to tackle weak productivity which the industry is currently facing. May revived the old concept of industrial strategy shortly before she took over as the prime minister of the country amid the political turmoil following the UK’s shock brexit vote. The move by the government of the world’s sixth largest economy to intervene in business is targeted at pulling Britain out of the slump which many expect, will follow the UK’s official exit from the trade bloc.
The goals of the government are mentioned in the 131-page document which aims to reposition Britain after the exit so that it can profit from the technological revolution. It intends to increase investment in technology, research and development, technical education and building better infrastructure. In a forward to the strategy, the PM said that she intends a strong and strategic state. The strategy, titled “Building a Britain fit for the future”, aims to build a Britain that is able to intervene decisively wherever it makes a difference. May said that the new approach of the government towards the industry is aimed at collaboration of the government and business.
As part of these efforts, the government has secured major investments from global healthcare company MSD and German-based diagnostics company Qiagen. The investments have been valued at 1 billion pounds by Financial Times, but MSD and Qiagen declined to quantify the amount.
MSD’s UK and Ireland managing director Louise Houson said the company was working in collaboration with the UK government to build on its “forward thinking and ambitious” strategy. It said it will open a state-of-the-art life sciences discovery research facility in London by 2020, focusing on early bioscience discovery and entrepreneurial innovation. It said that it viewed Britain as a world-leader in science, although a spokeswoman said Brexit raised “some very real concerns” for the supply chain, drug regulation and the ability to attract talent to Britain. The company intends to create 150 new research roles in London and move around 800 existing UK jobs to the capital.
Qiagen said its plans to develop a genomics and diagnostics campus in Manchester which has the potential to create 800 jobs.
The vote of confidence in Britain’s life sciences sector was welcomed by the government after the news last week that the European Medicines Agency will move from London to Amsterdam when Britain leaves the EU in March 2019.
Apart from life sciences, the government intends to focus on construction, artificial intelligence and the automotive industry. Business Minister Greg Clark said there is going to be new announcements of investments in the coming weeks.
Clark said Britain has some of the world’s best universities and research institutions, as well as leading companies in sectors ranging from advanced manufacturing to financial services, life sciences and creative industries. But he said Britain’s poor productivity – the amount of output per worker over a given period – was one of the weaknesses that it had to address. Employers say it is difficult to find workers with the skills they require and bottlenecks in infrastructure like roads and railways hinder business.
Rebecca Long-Bailey, a business spokeswoman for the opposition Labour Party, said the strategy was short on detail. She said that this is a White Paper made up of re-announced policies and old spending commitments, showing once again that this is a Government short on details and new ideas. Rebecca said that nothing in the White Paper will help give businesses the certainty or incentives they need to invest in the face of the government’s catastrophic handling of Brexit.
Brexit remains the biggest concern for British companies and multinationals operating in Britain. With only months to go before many businesses need to make decisions on future investment, they are eager for clarity on Brexit.