It’s said that you should invest for the long-term. Which is why the reports that NTT Corporation, Japan’s biggest telecoms and tech group, is eyeing Britain for its new global HQ are significant. After looking at cities around the world, the Tokyo titan looks ready to dial into London. As Britain grapples with Brexit, it’s a big vote of confidence in our future.
Words are one thing; investments another. But there’s reason for cheer here too: Britain has knocked the US from its perch as the world’s top investment hotspot. Britain was the seventh-ranked destination in the world for corporate deal-making in 2016 but now – for the first time in a decade – we are top dog, according to an EY report released last week.
The weak pound is playing its part, meaning that overseas buyers get a bigger bang for their buck when buying British. But the fundamentals of what puts the great into Britain’s businesses are clear: openness to foreign investment, the English language, our skilled workforce and our technology.
Foreign direct investments (FDI) – when a business based in one country invests in a business another – tell us a lot about how commercially attractive a nation is seen to be. Companies and investors go where they see the best opportunities. British firms have a reputation for being well-run, profitable and with good prospects. In these uncertain times, it’s proving just the ticket.
Seabrook, the Bradford crisps and snack company, was bought by the UK subsidiary of Japanese food giant Calbee last October. The local business now trades as part of a larger company with a huge international network, meaning more delicious crisps made in Yorkshire will be sold around the world. In 2016, Redfern Travel was acquired by Australia’s Corporate Travel Management after the Bradford business proved attractive to investors Down Under.
If the business making the acquisition takes a short-term view, it’s just about maximising profit. This isn’t always great for the host firm. But when long-term investments are made, the business putting up the cash often brings fresh perspective, investment and enthusiasm which can unlock opportunities. The local business is exposed to new practices, markets and ways of working. FDI brings money and opportunities to the host cities and regions too.
Increasing FDI into the Bradford district is part of our plan to boost the economy. The Bradford economic strategy is making good progress towards the vision of adding £4bn to the economy, generating 20,000 new jobs and improving the skills of 48,000 residents by 2030. But we are facing headwinds along the way.
Council budgets have been hit by austerity. The Revenue Support Grant that Bradford Council receives from the Government to spend locally is being cut. In 2013/14, the council received £183m. In 2020/21, that number will be zero. The Government expects councils to collect funds raised through local business rates instead. This means that we need more corporate activity to raise money to invest back into the region.
We are shouting more loudly about what we have to offer. Last month, the West Yorkshire Combined Authority – which brings together local councils and businesses – attended the MIPIM property conference in France. MIPIM is the World Cup of the property industry, with the best players around the world showing off their wares. The WYCA representatives took every opportunity to tell investors and developers about the fantastic opportunities in our region. Now we need to convert a few more of these chances.
Bradford Council set out plans for the Northern Powerhouse Rail at MIPIM and was well received. NPR is an amazing opportunity for the North: a rail network for the modern age which would connect Bradford to Leeds, Manchester and Liverpool. As part of the plan, a new stop would be constructed in Bradford city centre on a through train line, opening up new opportunities for the region’s residents and businesses.
These plans were also discussed at an event in Bradford this month to promote Transport for the North’s Strategic Transport Plan. Almost everyone I speak to sees clear economic benefits of investment in NPR and High-Speed Rail (HS2) for decades to come. This is game-changing stuff. But to make it happen, the financing needs to be put up.
Overseas investors are happy to invest in Britain. Japan’s biggest telecoms company looks like it will be dialling into the capital. The Government needs to dig deep for the long term and finance a transport network for the future. Words are one thing, investments are another.