Britain in Europe
[Re: Britain’s business elite is becoming increasingly Eurosceptic, yesterday]
It would be wrong not to applaud the efforts of Business for Britain to keep the EU in the public eye. And the aim of renegotiating Britain’s position is laudable. But it raises two questions. First, is there evidence that Europe’s leaders will entertain changes to the EU or Britain’s place within it? I suspect the opposite. They want more Europe, greater integration, and even more central control for Brussels. Secondly, even if they are prepared to listen, how long will reform take? It’s likely to be years, rather than months. We need a referendum soon. A clear mandate for change will give us a bargaining tool – the threat of an ultimate exit. Britain needs to have its own arrangements established, and cannot wait for other member states to get their act together.
David Peddy, managing director of Surgical Instrument Group Holdings
Anyone who remembers the attitude of business leaders towards Britain joining the euro should be pleased with this new campaign. When a referendum on our potential euro membership was indefinitely postponed in 2004, Business in Europe claimed multinationals would think twice about investing in Britain, and that thousands of jobs would be lost in tourism, agriculture and industry. We can all agree we made the right decision that time.
The president of the Bundesbank reckons the euro debt crisis will last for a decade. This will mean low GDP growth across the Eurozone, which will in turn impact company profits. Companies will seek more trade with the rest of the world – many parts of which have excellent growth prospects. Britain’s trade balance will tilt increasingly away from Europe, with the effect that the EU becomes less important in economic terms for business. Read of this what you will.
The aim of this new Business for Britain group seems to be for us to stay in Europe, but to make it slightly nicer. But renegotiation is not possible.
UK Silicon Valley
[Re: Tech City won’t be Silicon Valley – but it can learn its lessons, yesterday]
Deborah Perry Piscione’s article makes the important point that Silicon Valley is not just a geographic location, but a mindset. As an investor in a number of Valley firms, I agree that this can be replicated. But it does not guarantee that there will be the same results. London should develop its own unique entrepreneurial culture, not just copy someone else’s. Perhaps we’ve already seen it at work in the Olympic Games opening ceremony. It wasn’t to everyone’s taste, but the surest way to kill innovation is to be all things to all men. Importantly, the ceremony was irreverent, humorous, and anarchic.
Alexander Selegenev, executive director of TMT Investments
There’s a lot of guff in this article about the nice “mindset” of entrepreneurship, but there are two solid points: a business-friendly tax and finance system, and a science-based university. Britain is developing the first slowly, but unless science is promoted much more – actually favouring its study over the arts – we will never have the skills needed for success in the twenty-first century.
[Re: Banks must show they are now very different beasts, Friday]
Several of the changes banks have made since the financial crisis are fundamentally in conflict. You cannot expect banks to increase lending to businesses or individuals if you ask them to keep more capital and take fewer risks. This is why we are in the mess we are currently in.
The most important thing is for banks to start explaining exactly how a fractional reserve banking system works. Most people are under the illusion (for a variety of reasons) that their deposits are sacrosanct and safe. But even after Cyprus, they don’t understand that they’re loans, and therefore risky.
[Re: The Iron Lady’s revolution has only just begun, Thursday]
There’s a difference – and one that we’re only just really remembering – between seeking election to serve or do some good, and seeking power for its own sake. Since 1992, it seems the latter has taken hold in British politics.
[Re: UK executives lose appetite for M&A deals, yesterday]
The quality of company management is one of Britain’s biggest Achilles’s heels. Companies sitting on large cash piles should be on the hunt overseas for firms to buy in order to expand internationally. Sadly, many are too unimaginative. How can Britain best the world economically if our businesses are not willing to take risks and strive to be the world’s biggest? We can talk all we like about tax codes and confidence, but there has been a definite decline in the fundamental capitalist values of risk-taking, grand ambition, and the desire not just to survive but to thrive.
BEST OF TWITTER
British business hits back against the EU. I’m sure many will soon realise that reform is impossible.
The EU does need reform, but calls for renegotiated relationship just for Britain won’t succeed.
Most entrepreneurs find that the costs of EU regulations far outweigh the benefits of the single market.
Jose Manuel Barroso says Europe is near the limit of austerity. Meanwhile the average EU sovereign indebtedness hits an all time high.