Rishi Sunak has said the UK will not return to the close relationship with China pursued under David Cameron, as the prime minister met business leaders in an effort to drum up foreign investment.
On Monday, the government announced that £29.5 billion in new investment has been designated for the UK. This includes initiatives from ScottishPower’s parent company Iberdrola and BioNTech, a German company that collaborated with Pfizer on their Covid vaccine.
Sunak held a meeting with the leaders of international companies such as Goldman Sachs, Blackstone, and JP Morgan at the conference in Hampton Court Palace in the south-west of London. Later, he attended a reception with King Charles at Buckingham Palace.
Forecasts for economic growth in the UK were significantly reduced during the recent autumn statement, placing urgent demands on the government to demonstrate efforts towards reviving an economy greatly impacted by excessive inflation.
Cameron sought out Chinese investment in the UK during his time as prime minister until he stepped down in 2016 following the EU referendum. He has now reentered the political scene as foreign secretary, prompting speculation about potential shifts in UK policy towards China amidst heightened tensions in recent years. At the summit, Cameron held a closed-door meeting with business executives.
Sunak indicated that he had no plans to alter UK policy. During the summit, he stated, “If David Cameron were present, he would likely acknowledge that the China of today is vastly different from the China he encountered ten years ago.”
According to Sunak, China, the second-largest economy in the world, is an undeniable reality in economic affairs and finding solutions to major global issues without China is not possible. The prime minister expressed this viewpoint while participating in a panel with Steve Schwarzman, the billionaire chairman and co-founder of Blackstone, an investment company.
Hunt and Sunak received accolades from business executives such as Jamie Dimon, CEO of JP Morgan, the biggest bank in the world. Dimon commended UK policies for being more favorable compared to those of the US. He heavily criticized US policies, equating government spending on stimulus checks and bond purchases by the Federal Reserve to addictive drugs.
“It is understandable that you would feel optimistic,” Dimon stated regarding the effect on the American economy. He expressed his belief that the recent strong growth may be temporary. He also acknowledged the possibility of continued inflation in the US, potentially leading to prolonged high interest rates set by central banks.
Sunak emphasized the need for the UK to shift its focus towards regions such as the Middle East and Asia Pacific in order to attract investments. This was evident in a recent discussion led by chancellor Jeremy Hunt, which included influential figures like Khaldoon Al Mubarak from Abu Dhabi’s Mubadala Investment Company and chairman of Manchester City, as well as Yasir Al-Rumayyan, governor of Saudi Arabia’s Public Investment Fund. Al-Rumayyan noted that their recent investment in rival football club Newcastle United has had a significant impact.
Sunak presented the UK as a strong ally and expressed his desire to out-collaborate with adversaries.
The former Shadow Secretary of Trade and Business, Jonathan Reynolds, stated: “The last 13 years of Conservative rule have been characterized by a total absence of stability, consistency, and ambition, which has driven potential investors away from the UK.”
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The summit was accompanied by a series of investments that were praised by the government. These included a £10 billion pledge from Australia’s IFM Investors for energy and infrastructure, £7 billion from Iberdrola for UK electricity transmission, and £5 billion from Australia’s Aware Super for energy and housing ventures.
BioNTech, the creator of the mRNA vaccine for Covid, plans to construct a fresh laboratory in Cambridge. Meanwhile, Microsoft is investing £2.5 billion in AI infrastructure.
It is unclear which of the projects, if any, were a direct result of the investment summit.
In October 2021, while serving as Prime Minister, Boris Johnson organized a comparable meeting at the Science Museum in London. Prominent business leaders, such as Microsoft co-founder Bill Gates, were in attendance. The group was later invited by the Queen to Windsor Castle.
The government has stated that the majority of the £9.7bn in investments promised at the summit, including £6bn for offshore windfarms from Iberdrola, are still in progress.
Source: theguardian.com
