Author Archives: GovWorldMag

A no deal Brexit will hit family budgets – Jenny Chapman MPJenny Chapman MP, Labour’s Shadow Brexit…

A no deal Brexit will hit family budgets – Jenny Chapman MP

Jenny Chapman MP, Labour’s Shadow Brexit Minister, commenting on the report by the Resolution Foundation and Sussex University’s UK Trade Policy Observatory on a “no deal” Brexit scenario, said:

“This report is further evidence of how a no deal Brexit will hit family budgets and the potential dire consequences of the Government’s chaotic handling of the Brexit negotiations.

“Britain crashing out of Europe without a deal is simply not a viable option. No deal risks price hikes in the shops as a result of extra charges on everyday items, such as food and drink. And yet, the only solution Ministers have offered to this potential crisis is ‘dig for no deal’.

“Theresa May must use this week’s EU Council meeting to end the deadlock in Brexit negotiations and protect Britain from an economic cliff edge. That means agreeing strong transitional arrangements within the single market and a customs union”.

read more

Labour •

Revisions to international investment figures

The ONS published its latest balance of payments data on 29 September. This included a final table which showed that the ONS have revised their view of how much UK investment abroad is worth relative to how much overseas investors have invested in the UK. Some have now suggested these figures show the UK has “lost” £490bn.  This is an odd way of looking at it. The figures show an increase of £334bn in inward investment, which of course is a figure that is taken off our overseas assets to derive the net figure. It does no however mean we have got poorer!

The maximum downward revision to the net figure was for the 2016 figure (£490 bn), with the bulk of the downward revision relating to a period before the referendum vote. The main reason for the downward change in the net figure arises from strong inward investment in 2016 accounting for an extra £334 bn investment.

I have often referred to the large  balance of payments deficit we have been running, and pointed out that an important part of our net outflows arise from the substantial contributions we make to the EU and from our large overseas aid payments. I have often argued to stop the EU payments, to up the UK content in the overseas aid spending where the money cannot  be spent in the country we are trying to help, and to follow policies which promote more import substitution. All the time the UK continues to send large sums abroad, and to run such a large trade deficit with the EU, there will need to be continuing inward investment into the UK to pay the bills. Alternatively we will have to sell overseas assets to pay for the imports and the remittances overseas. Either of these ways of paying for the trade and payments deficit will tend to reduce our net overseas asset position.

This is nothing to do with Brexit.The biggest part of the deficit is trade with the EU and payments to the EU.

It is also a reminder of how much trouble the ONS have in measuring things like the stock of overseas wealth held by UK people and institutions, which they have recently reduced as they change their way of estimating. They also have  difficulty  in knowing how much overseas investment has been committed here. Those who think Brexit has caused the fall in the pound should of course acknowledge that so far if this is true Brexit has helped swell the net overseas asset figure, by increasing the sterling value of foreign assets. Readers of this site will know I do not think Brexit is the main reason for the fall of the pound since 2015, nor for that  matter for the recent rise of the pound against the dollar.

read more

John Redwood MP •

Beijing plans culture and tech integrated development

Beijing has drafted a document of suggestions on promoting the integrated development of culture, science and technology.

The document provides specific implementation guidelines for the related industries, including setting up the certification standard for the demonstration enterprises for the integrated development between culture and science and technology.

A new economic engine

Beijing has five demonstration bases of integrated development between culture and science and technology at the national level.

“Software, internet and computer services — mainly animation game, online literature and new media — dominate the cultural and creative industry in Beijing,” Du Feijin, director of the Publicity Department of the Beijing Municipal Committee of the CPC, said.

Du said the total revenue of the software, internet and computer services in 2016 reached 701.1 billion yuan (US$106.6 billion), accounting for 39.2 percent of the revenue of the cultural and creative industry in Beijing.

Xu Qiang, director of the Beijing Science and Technology Commission, said “Beijing has a great atmosphere for innovation and entrepreneurship in the cultural and creative industry.”

According to him, by the end of 2016, there are 3,047 high technology enterprises in the cultural industry in Beijing, about 20 percent of the number throughout China.

Du said that the integrated development of the culture and science and technology industries has become the new engine for the economic development of Beijing.

Supportive policies and copyright protection

The document stipulates 10 major tasks, including setting up the certification standard of the enterprises of integrated development of culture, science and technology, promoting the use of technology in protecting the history and culture of Beijing, and improving the financing service system.

The document also provides specific implementation guidelines, such as requiring the city to identify the qualified enterprises that meet the certification standard once a year.

However, Du said support for cultural enterprises by the city fall short in comparison with support for science and technology enterprises, and policies on regulating and supporting the integrated industry are yet to be in place.

“Most cultural enterprises lack the capability of independent innovation,” Du said.”The investment in research and development in cultural enterprises is not sufficient.”

What’s more, copyright protection for cultural properties remains a challenge in the integrated development industry, Haidian District party secretary Yu Jun said.

Beijing’s science and technology advantages

By the end of September, there were more than 470,000 scientific and technological enterprises in Beijing, over 1,000 research institutes, and other workshops and organizations that provide platforms for the integrated development of culture and science and technology.

Universities and colleges in Beijing have set up new academic programs to train interdisciplinary talents in order to meet the needs of the integrated development.

read more

East Asia