Newsletter 10/03/24


Jeremy Hunt’s second budget as Chancellor contained little to get excited about.

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Dear Subscribers,

Jeremy Hunt’s second budget as Chancellor contained little to get excited about. Constrained by fiscal rules and struggling public services on the one hand and the need to give voters a reason to vote Conservative at the next election on the other, the new measures are no more than modest and do not signal a significant change of direction. With no clear ambitions in government, it makes you wonder not just how the current administration came to power, but why they bothered at all.

The pharmaceutical company AstraZeneca this week revealed plans to invest £650 million in the UK, with £450 million for a new vaccine manufacturing facility in Liverpool and £200 million for an expansion of its presence in Cambridge. The company is set to open a new facility for manufacturing cancer medicines in Macclesfield, the result of a £380 million investment first announced in 2021. Meanwhile, German technology giant Siemens has announced that it plans to create a new research and development facility in Wiltshire, with an investment of £100 million.

A welcome boost for the UK pharmaceuticals industry

The European People’s Party, the largest party in the EU Parliament, has called for the UK to be invited to join a new European Security Council, composed of leaders of EU member states. The foreign secretary, Lord Cameron, poured surprisingly cold water on the offer, saying “there’s a danger sometimes of putting something into a structure that every single European country has to be consulted, everyone has to take part, you get absolutely surrounded by bureaucracy and nothing gets done.” Wise words.

Voters in Ireland have emphatically rejected proposed amendments to the constitution which would have replaced clauses containing ‘traditional’ family values with ones that use more ‘progressive’ language. The amendments were supported by all three parties of government and the largest opposition party, Sinn Fein. The result is symptomatic of a widening gulf – in

Ireland and elsewhere – between the social views of politicians and those of ordinary voters.


Out of touch


Professor Angus Dalgleish on the covid conmen landing top jobs

Patrick O’ Flynn asks Nigel Farage to re-enter British politics

Derrick Berthelsen on dubious Brexit counterfactuals


Lies, damned lies, and FT propaganda by Catherine McBride

I would have expected the Financial Times (FT) to have given up on its Anti Brexit Propaganda by now, but they just can’t get over Brexit. This time they are telling some half-truths and using some extremely misleading graphs to disparage UK trade.

The Financial Times has gone to great lengths to try to convince its readers that Brexit has been bad for UK trade, conflating EU and non-EU goods trade, ignoring service trade and never entertaining the possibility that any other government policies, such as Net Zero, may have been the real cause of certain industry groups seeing large falls in their exports. No, in the FT’s mind, all bad things must be due to Brexit.

Key Points

In a speech at Chatham House this week, Trade Secretary Kemi Badenoch described the important role that post-Brexit Britain has to play in defending global economic security and promoting free trade. It was a welcome dose of optimistic realism in an area which is saturated with fantastical pessimism. If only more government ministers would stand up for the vision of Global Britain which got them elected in the first place!

Badenoch first busted some Brexit myths. How often do we hear that Brexit has been bad for economic growth, and that we would be better off if we tethered ourselves to our continental cousins? But IMF projections for the next 4 years have Britain outgrowing France and Germany. By 2035 the UK economy is expected to be 17% larger than France’s. How often do we hear that Brexit has been bad for exports? This despite the value of total exports increasing by more than 50% since 2016, and more than 30% since leaving the EU in 2020. How often do we hear that Brexit has been bad for foreign investment? Another myth – Badenoch pointed to new figures showing that the UK is Europe’s number one destination for foreign direct investment.

While these narratives continue to do the rounds in the media, one perspicuous Brexit success story is seldom mentioned. When Britain left the EU, it had not had to negotiate a trade agreement for 47 years. Having started from scratch, trade negotiations are now one of the few things that the British government is conspicuously good at. Since 2016, the UK has signed 6 new trade agreements and joined the CPTPP free trade bloc. Negotiations on 6 more deals continue.

Badenoch rightly pointed out that these achievements have come at a time of geopolitical uncertainty and instability, when the first impulse of most countries is to turn inwards. This makes them not only more impressive than they might otherwise have been but also more important. Isolation does not serve the interests of economic security, however challenging the international outlook is. Outside the EU, Britain can lead by example, pursuing free trade and international cooperation in an age of trade wars and tit-for-tat tariffs.

The Trade Secretary has a powerful message that has proven popular at the ballot box in 2016 and 2019. It is a shame, then, that so few members of the government seem willing to embrace it.

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