Back in January, I wrote that the City of London has much to be optimistic about. As a Hong Kong-based investor with close ties to the UK, I could see that the British people’s decision to leave the EU would have little material impact on its future success. I believed that the foundations were strong and that the UK would continue to build on them. Covid-19 notwithstanding, I still do.
For the international investor community, we all thought that 2019, with the volatility surrounding Brexit and the uncertainty of a snap General Election, was our annus horribilis. Ironically, there will be some who now look back fondly on those days of relative calm.
There is no denying that the Covid-19 pandemic has been a body blow to the system. It is a dreaded Black Swan event. There is not a single country around the world that has not had its confidence tested. Many thousands have tragically lost their lives before their time.
Lockdown days have turned into lockdown weeks and months. The Governor of the Bank of England has warned that GDP could fall by 14 percent in 2020 – the largest fall in 300 years. The Government seems acutely aware of these economic and financial risks and has made strong interventions to shield people from the worst. But in the medium to long-term it faces a difficult balancing act between protecting the public’s health and ensuring that people’s livelihoods are not destroyed.
And yet, I still remain optimistic about the future and committed to investing into the City of London through the future redevelopment of 55 and 70 Gracechurch Street. At times like these, it is important to take a step-back and to focus on the bigger picture and the fundamentals.
The UK, especially the City of London, will continue to be a centre for international investors. The City of London can trace its commercial origins back to the days when the Romans established Londinium. The UK survived the devastation of the Spanish flu in 1918, and I am in no doubt that it will – thanks to the bravery of the NHS staff and the resilience of its key workers – bounce-back from Covid-19.
English is not going to be replaced as the international language of business anytime soon. The English legal system will continue to remain the most trusted anywhere in the world. And with the news that Oxford University in collaboration with AstraZeneca is leading the charge to develop a vaccine, it is hard to escape the fact that the UK is an intellectual powerbase.
I am not naïve. The fact remains that in the absence of a vaccine, there is no panacea to solving this crisis. And inevitably, there is going to be some short-term pain and we will be living with the consequences from this pandemic for many years to come. We will all have to continue to do our bit. I say this as someone who still holds fresh memories of the 2003 SARS epidemic in Hong Kong.
But that does not mean that as human beings we cannot adapt and learn new ways to cope with its existence. I believe that creativity and innovation often arrive at the most difficult moments and I say this precisely because of my lived experience through the 2003 crisis and the fact that we have survived multiple waves of Covid-19 this year.
We will see changes in how we work and in the attitudes of our businesses and employees. The principles of Environmental, Social, Governance (ESG) will evolve but remain central. Where the Environmental has been high on the agenda in recent years, so too must Social and Governance – it is my view the gap between E vs SG will now narrow. The ‘right’ office space will become more important than ever as will the flexibility we as business owners offer the workforce. Post-Covid the social element is pivotal and is a new era of self-governance among all stakeholders.
London, like every other major city, will participate in the great global rebuild, and with its fine embedded qualities will once again shine through. As establishments start to open again, as they are in Hong Kong, I can tell my friends in the UK: do not despair, there is light at the end of the tunnel. London’s future is as bright as its glorious past, and more likely to reach new highs.