Friday 14 June 2019
Britain beats the rest of Europe for investment, boasting more new projects than any other nation. As soon as Brexit is behind us, and the uncertainty dealt with, the economy is poised for an even bigger investment bonanza from global businesses. Employment and wage rates continue to rise. Shoppers will benefit from an escalating price war between the low-cost supermarkets and the established chains, meanwhile, Britain has renewed its trade pact with South Korea.
Yet again, the UK is pronounced king of inward investment in Europe. 1,045 projects were financed by foreign investors in 2018, compared to 973 in Germany and 1,027 in France. There’s no doubting investors’ fondness for the UK, an EY survey found that only 6% of investors are moving assets abroad…
…Similarly, a survey of 1,300 business leaders from the big eleven economies found that global companies from the world’s largest three markets, the US, China and Japan all expect to invest more in the UK post-Brexit. The US is already Britain’s largest trading partner. The positive attitude towards the UK was shared by three-quarters of US chief executives. In India, it was two-thirds and more than half in Japan and China.
Lidl will open its first store in Central London as part of a massive expansion across the UK. The £500m outlay will create 1,500 new jobs and 40 new stores. The low-cost German retailer is also building a new headquarters in South West London. Together with Aldi, Lidl is taking on Britain’s existing supermarket chains, a price war has broken out. The main beneficiary is of course, the consumer. “Our £500m investment reflects the scale of opportunity we have to bring our quality produce to even more of the capital’s communities, at prices that makes it affordable to everyone,” said chief executive, Christian Hartnagel.
No surprise then that consumer confidence has risen to its highest level since September 2018 — see City U.K.
The UK has renewed in principle its existing trade deal with South Korea. “This means that whatever happens with #Brexit, there will be total continuity in trade between our two countries AND the basis for an ambitious future FTA when we leave the EU,” tweeted international trade secretary, Liam Fox. The existing arrangement was struck in 2011 by the EU – Britain currently has no independent authority to sign trade deals of any significance. Fox views this renewal agreement as a stepping stone towards “a deeper, more ambitious future agreement. Trade has doubled since 2011 to >£14bn.”
The employment rate continues to break records. Not since 1974 has joblessness been so low – for women it is currently the lowest since records began. Unemployment currently stands at 76.1%, a half percent increase on this time last year. Unemployment fell by 34,000 to 1.3 million, continuing a general trend which started way back before the referendum in 2012. Wages have increased by 3.4%, above the rate of inflation…
…Britain’s central bankers are suffering from the good kind of headaches compared to their American and European counterparts, the latter fearing the continuing drag of high unemployment and a trade war with the United States. In turn, the US Federal Reserve is fearful of a similar conflict with China. Deputy governor of the Bank of England Ben Broadbent told lawmakers the UK would probably need to raise interest rates to deal with strong wage growth. Broadbent is joined by two other senior colleagues at the BoE who are fearful of inflationary pressures brought about by rising wages and employment.
A tired old argument of the Remain campaign is that without an open immigration policy, Britain’s farms will struggle as they are denied access to the cheap labour they supposedly need to pick their fruit and veg. The solution, farmers say, is to relax the rules for prisoners on day release and ferry them out to the fields. “I will be getting in touch with my local prison and tell them who I am and what I want, and they will go and find potential people for my fruit farm,” says Suzanna Starkey, a fruit farmer from Northamptonshire.
Starkey’s optimistic attitude helps to explain why a recent survey found that No Deal Brexit was the most popular outcome in a recent survey of farmers. Of the 200 farming businesses questioned, more than a quarter ranked it topped. Pretty phenomenal when you consider how much they benefit from the CAP.
Yorkshire is benefitting more than the rest of the country from the export dividend brought about by Sterling’s lower value, a direct consequence of the 2016 EU referendum. Astonishingly, Yorkshire exports grew 7.8% last year, totalling £18.1bn, three times the national average.