The baton passes to Europe

However much they would like just to focus on doing profitable business in this country, international turbulence is posing big risks to the plans and investments of many UK businesses. From a flood of insightful articles in journals and newspapers, we have concluded that new realities affecting the overall UK economy, and individual businesses in the immediate future are that:

1. We can no longer outsource much of our security to the United States
2. Tariff uncertainty will make access to US markets unpredictable
3. The current Russian regime represents an economic and security threat to Europe
4. The pillars of the post-WW2 economy such as the World Bank, the IMF, and the US dollar as the world's main reserve currency, may no longer fully serve UK and European interests.

Unsurprisingly, many companies regard these developments as highly unsettling and the US Federal Reserve has already signalled that the current level of uncertainty will hit the previously buoyant US economy.

Fortunately, the EU and leading European democratic nations, including Germany, France, UK, Poland, and the Nordic countries are already acting to strengthen and unify Europe's military capability and address the economic damage caused by Brexit and Russia's invasion of Ukraine. We are optimistic that the recent jolts to European complacency can lead to a real European renaissance which builds prosperity based on traditional social democratic values. Furthermore, greater European cooperation will help mobilise Europe's enormous industrial, military, intellectual and cultural strengths. Until this happens, however, and is translated into electoral support and economic progress, the incumbent governments face an uphill battle.

For the UK defence sector all this is good news, except possibly for suppliers to US defence programmes such as the F35 fighter. Likewise, housebuilding, infrastructure investment and the green transition seem likely to be prioritised by the government and see real growth. Elsewhere, most sectors and SMEs are likely to have to wait for an uptick in the economy to bring good news. We believe that the government's continued focus on economic growth and policy stability will eventually bring this good news, unless the external situation throws up more big problems.

Our next event will focus on the government's mission to create opportunity in the UK. Our spring reception will provide more opportunities for members to meet people in the new administration.