Sunday, December 5

Brexit Britain a beacon of relative stability



Executives around the world regard the UK as a ‘beacon of relative stability’ for their businesses.

In a major vote of confidence in Brexit Britain, a survey of bosses by PwC found the UK is the fourth most important country for international firms, behind the US, China and Germany.

The accountancy firm’s report found, for chief executives in Germany, France and Italy, the UK is as attractive now as it was in 2015, with a notable uptick since last year.

Speaking at the World Economic Forum in Davos, Kevin Ellis, chairman of PwC UK, said: ‘The findings provide timely perspective on the UK’s standing as a place to invest and do business. Viewed against the turbulent global backdrop, the UK is a beacon of relative stability.

You can’t replicate natural advantages like our timezone and location between the US, Asia and the rest of Europe, but more than that the UK is a fair and trusted place to do business.

Business Secretary Andrea Leadsom said: It’s excellent to see such confidence in the UK.

The findings came as the International Monetary Fund said it expects the UK to grow by 1.4 per cent this year and 1.5 per cent next year faster than its main European rivals but not as strong as the US. But casting a shadow over the start of the WEF’s 50th annual meeting in the Swiss ski resort, the Fund downgraded its forecasts for the global economy and warned that climate change and trade tensions pose major threats to living standards.

Gita Gopinath, the IMF’s chief economist, said: ‘There is simply no room for complacency, and the world needs stronger multilateral co-operation and national-level policies to support a sustained recovery that benefits all.’

Business leaders will be watching closely for any signs of tension today, as both US President Donald Trump and China’s vice-premier Han Zheng are due to speak at Davos amid hopes their 18-month trade war may be coming to an end.

The IMF said the world economy grew by just 2.9 per cent in 2019 – the worst performance since the financial crisis more than a decade ago. And it trimmed its forecast for this year from 3.4 per cent to 3.3 per cent and for next year from 3.6 per cent to 3.4 per cent.

The report said: ‘Climate change, the driver of the increased frequency and intensity of weather-related disasters, already endangers health and economic outcomes, and not only in the directly affected regions.

It could pose challenges to other areas that may not yet feel the direct effects, including by contributing to cross-border migration or financial stress, for instance, in the insurance sector. A continuation of the trends could inflict even bigger losses across more countries.

IMF’s managing director Kristalina Georgieva warned that the world economy is facing startling similarities with the 1920s.

She said growing inequality of wealth in countries such as the UK and the US, along with rapid advancements in technology meant the 2020s could easily be compared with the 1920s, an era which ultimately ended in the financial disaster of the Great Depression.