By Richard Pickering, Head of Futures Strategy
Red, Yellow and Blue Both the Labour Party and the Lib Dems have released their manifestos. The Lib Dems will notably be the only major party offering a further referendum on the final terms achieved in the Brexit negotiations, which may well score them votes in pro-Remain constituencies. Meanwhile, Labour’s manifesto, covered with Jeremy Corbyn’s fingerprints, promises a ‘better, fairer Britain’, achieved through higher taxation and an expansion of the State. Critics have pointed to a lack of identified funding for the promised nationalisation of the Royal Mail, and the UK’s rail operations. But perhaps one can afford to make bold promises when the object is to win more than 200 seats (a ‘successful result’, according to Len McCluskey), rather than be faced with the prospect of having to deliver on them. The Tory manifesto (to be launched tomorrow) will in that context be the more important document released this week, for better or for worse.
Terrorism of things This week the UK was subject to the biggest cyber-attack in history according to Europol. The attack, which affected 200,000 computers across 150 countries, particularly affected the UK’s largest employer, the NHS. In the wake of 9/11, increasing precautions have been taken to mitigate the physical impact of potential terror attacks on our buildings. These range from increasingly intrusive bollards / barriers, to more rigorous security / entry procedures. However, in an increasingly connected world, there should perhaps be similar focus given to digital threats. Starting in 2015, the amount of devices connected to the internet is expected to double within 5 years, and multiply by a factor of seven within 10. Crucially, ‘Internet of Things’ sensors, increasingly used in smart office design, are projected to overtake mobile devices as the largest area of growth by 2019. Hacked elevators, ransomware in air conditioning systems, and security gates that open themselves may well be features of modern terrorism.
City strength Research published this week by UHY Hacker Young confirms that the City of London has extended its lead over other locations as the strongest economy in the UK (GVA grew by 24% since 2008). This is in spite of the prospect of Brexit and the once presumed effects of the financial crisis. Prime rents in the City core have grown by 30% over the same period; however only 10% in real terms; perhaps demonstrating increased value for occupiers. The strongest town outside London is Milton Keynes (£41k per head, 1/7 of the City’s GVA), which has grown by c.20% over the same period.
Silk Road The £15bn Crossrail project is due for completion next year, whereas the £50bn HS2 is scheduled for completion in 2033. Both of these are minnows compared with China’s $900bn+ ‘Belt and Road’ project, presented by Xi Jinping over the weekend. The roadbuilding and shipping lane initiative led by China is the world’s largest-ever infrastructure initiative, impacting what has been identified by McKinsey as 65% of the world’s population and 1/3 of the world’s GDP. Its reach extends to the UK, as earlier this year the first freight train from eastern China arrived in London, and with both countries agreeing to link Belt and Road into the Northern Powerhouse. The trade benefits for China are clear; meanwhile Philip Hammond also points to a role for the UK in finance, design and delivery.
Tigers You get accustomed to highs and lows as a Hull City fan. OK, mainly lows. And so ignoring the more unlikely reasons for this year’s relegation (such as not winning enough matches, or setting a new Premier League record for giving away the most penalties -13 in case you were wondering), what are the factors underpinning Hull’s woes? Perhaps it’s the black and orange kit? The seven top teams this year all donned a patriotic shade of red, white or blue. Or perhaps it’s the geography? The top seven teams are all either from London or the North West, whereas the bottom three are all from the North East. No – you guessed it – it all comes down to the EU. Hull was the club least exposed to EU players (5% of appearances this year), whereas champions Chelsea had the most (75%). Roll on Brexit.