UK Competitiveness
Connor Thatcher
The UK is a poor exporter of goods and runs at a trade deficit, something that hinders its long term growth. In order to combat this, the UK government is undertaking a variety of new policies to increase its competitiveness and therefore improve its balance of trade.
One of these policies is increasing the investment in infrastructure; the government has pledged over £100bn investment by 2020 and has given guarantees for lenders financing infrastructure projects. More than 200 projects in rail, road, local transport, flood defences, broadband, airport infrastructure and waste management are due to start construction in 2014 to 2015 alone. This has been undertaken to improve UK businesses ability to transport goods, to communicate and make the UK a more attractive place to set up a business or invest. UK companies may gain advantages due to these improvements in infrastructure that improve their competitiveness. On the other hand, investment in infrastructure is not cheap, huge sums of money has been dedicated to development projects and this money could have been spent elsewhere. The investment in infrastructure is a good idea, as it helps UK firms become more efficient and can reduce costs, making them more competitive
Increasing access to finance is another measure that has been undertaken via the creation of the funding for lending scheme and the £1bn business bank. The increased access to capital for business may lead to increased investment in improving technology, becoming more productive or growing in size. These can only help UK companies become more competitive on global markets and help increase their exports. However, there are issues with the schemes, such as the way in which money from the Funding for Lending scheme was lent out. The money was supposed to mainly go to small and medium sized business, yet 90% of the money was lent out in the form of mortgages and only 10% to business. This in turn had all sorts of negative ripple
The UK is a poor exporter of goods and runs at a trade deficit, something that hinders its long term growth. In order to combat this, the UK government is undertaking a variety of new policies to increase its competitiveness and therefore improve its balance of trade.
One of these policies is increasing the investment in infrastructure; the government has pledged over £100bn investment by 2020 and has given guarantees for lenders financing infrastructure projects. More than 200 projects in rail, road, local transport, flood defences, broadband, airport infrastructure and waste management are due to start construction in 2014 to 2015 alone. This has been undertaken to improve UK businesses ability to transport goods, to communicate and make the UK a more attractive place to set up a business or invest. UK companies may gain advantages due to these improvements in infrastructure that improve their competitiveness. On the other hand, investment in infrastructure is not cheap, huge sums of money has been dedicated to development projects and this money could have been spent elsewhere. The investment in infrastructure is a good idea, as it helps UK firms become more efficient and can reduce costs, making them more competitive
Increasing access to finance is another measure that has been undertaken via the creation of the funding for lending scheme and the £1bn business bank. The increased access to capital for business may lead to increased investment in improving technology, becoming more productive or growing in size. These can only help UK companies become more competitive on global markets and help increase their exports. However, there are issues with the schemes, such as the way in which money from the Funding for Lending scheme was lent out. The money was supposed to mainly go to small and medium sized business, yet 90% of the money was lent out in the form of mortgages and only 10% to business. This in turn had all sorts of negative ripple