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CBI: The UK is open for business at the G20

The G20 is our chance to show the rest of the world that the UK is still a major economic player, says Carolyn Fairbairn, CBI Director-General.

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This article appeared in The Sun on Sunday, on 4th September 2016.

I would hazard a guess that most meetings of the G20 – the gathering of Presidents, Prime Ministers and central bankers from 20 major economies – pass most of us by. They can seem like talking shops for up-in-the-air ideas that have little impact on our daily lives.

But as world leaders start to gather today in the Eastern Chinese city of Hangzhou, this G20 may prove to be a more memorable occasion. That’s because it will take place against a fundamentally different political and economic backdrop – and a much more challenging one.

Here in the UK, the Government is beginning the complex task of negotiating our departure from the European Union, following the momentous decision to part ways after 43 years.

Further afield, the dragon’s roar of the Chinese economy is fainter than it was, and the United States – the byword for global stability – will shortly undergo the most fractious presidential election in recent memory.

But most of all, the G20 will be an occasion for our new Prime Minister to send a signal, loud and clear, that the UK is well and truly open for business.

Signing ambitious trade deals after concluding negotiations with the EU will ultimately lead to more jobs being created here at home, and so should be top of the Prime Minister’s agenda. The G20 is an excellent opportunity for Mrs. May to begin to build the foundations for these trading relationships, face to face, which will be critical to making a success of Brexit. However, redefining our economic and trading links with Europe must be the first priority. Europe remains our biggest trading partner and the terms of our exit from the EU will help to shape what future trade deals look like.

Our proud history as an island nation is inextricably linked to our prowess as a trading nation, in everything from cars to chocolate, but the future of that status will depend on business and the Government working together to answer some of the tough questions about how best to reimagine the UK's relationships across the world. A strategy will be needed to boost trade with partners old and new, and markets should be carefully prioritised, in consultation with business. British firms are innovative, ambitious and global in their outlook, so we should be confident.

As the Prime Minister finds herself in the world’s most populated state – and one whose economy, despite slowing recently, grew just shy of 7% last year – her mind will naturally turn to our trading relationship with China, whose economy has been transformed in just a few years. Trade between our two countries has trebled since 2007, and the “Golden Era” of UK-China relations reached new heights last autumn, when Her Majesty The Queen welcomed President Xi Jinping to the UK, with the full pomp and circumstance of a State Visit, to sign £40 billion worth of business deals.

Building on this should be a major focus. In every region of the UK there’s a Chinese story waiting to be told, with investors from China helping to create jobs, drive innovation and, most importantly, form part of the global answer to our regional challenges. In London, we’ve seen investment from China in iconic black cabs, while Greater Birmingham has secured almost 50 Chinese investment projects over the last decade, from car manufacturing to real estate, creating nearly 2,700 new jobs for the area.

Let’s be clear - in the aftermath of Brexit, the world won’t wait for us. The UK can’t just sit around expecting opportunities to land on its doorstep. Like any business deal, we need to go out and compete.

When the Government postponed approval of Hinkley Point nuclear power station, it was understandable that it wanted to get to grips with the detail of the contract. But it’s crucial the Prime Minister now makes a clear and timely decision on this major infrastructure project. Not just for the jobs it will create, the spur it will give to the South West, and because nuclear is part of the energy mix we need to help keep the UK’s lights on in future. But because it will send a crystal clear message that the UK is keenly outward looking when it matters more than ever before.

And what better way to accompany that decision than to remove another long-standing infrastructure cloud that has been hanging over our heads for decades – a much needed new runway in the South East. While we’re staring at the departures board waiting for a decision, airports in France, Germany and the Netherlands are getting one with building routes to emerging markets. If the UK doesn’t act now, we could lose out on over £30 billion in trade by 2030 with the BRIC (Brazil, Russia, India and China) economies alone. So again, let’s simply get on with it.

A strong British economy is vital to jobs, opportunity and prosperity across our great nation. We hope the Prime Minister will make the most of the G20, and use it to reassure Britain’s workers, makers, exporters and investors that the UK is a confident, open and ambitious trading nation. 

 

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