A positive perspective on our economic prospects for 2018
WHILE December is typically a time for reflection on the year that’s passed, it’s also an opportunity to look and plan ahead.
Brexit cast a huge shadow over all other issues – big and small – this year and dominated conversations with businesses, politicians, friends and family. Delays to or scrapping of large projects in Wales has also been a source of frustration and concern.
Uncertainty over the outcome of Brexit negotiations has impacted on business confidence, with 49% of respondents to a recent ACCA survey saying they feel less confident than a year ago.
Business uncertainty caused by the Brexit process was the biggest driver cited by nearly a quarter of respondents, followed by concerns over Single Market access and loss of freedom of movement.
However, surely, amid all the gloom, there are some positives that we can look forward to in 2018?
One reason to be cheerful has to be the recent agreement that the Brexit talks can now move on to phase two, the trade negotiations. As the EU is the largest trading partner for Wales (with around 60% of our trade being with the EU), it is crucial to secure a deal that meets the needs of the different sectors in Wales.
Progress has been made in terms of other major developments for Wales – the recently-launched £440m Development Bank of Wales will be a substantial support for ambitious Welsh businesses looking to start up or expand.
Granted, it will largely occupy the space filled previously by Finance Wales, but will it have the additional benefit and potential of carrying more responsibility, having more clout and a new £100m Wales Flexible Investment Fund.
Cardiff Airport has also celebrated various milestones this year – with continued passenger growth and the announcement of a new Doha route for 2018.
While the announcement in last month’s Budget of a freeze on Air Passenger Duty tax was welcome, the abolition of it altogether or for it to be devolved to Wales would have been hugely beneficial for Cardiff International Airport and would have gone some way to boosting growth in our aviation sector and our wider economy.
At the annual Forum lecture at Cardiff Metropolitan University last month, Carwyn Jones also announced the launch of the Welsh Government’s new global satellite offices. The new offices in Germany, France, Canada and Qatar will, like the existing 15, support Welsh exporters and hopefully raise the profile of Wales overseas and drive inward investment.
And with Welsh exports rising above the UK average – an increase of nearly a fifth over the last year, according to latest regional trade figures – these new bases provide additional possibilities for the growth of Welsh trade. While Germany remains our most substantial market, strong increases in exports to both France and the United States are encouraging.
High-profile events and worldclass sporting highlights including the Champions League Final, Champions Trophy Cricket and Anthony Joshua’s boxing bout have this year furthered our capital city’s global profile. Hopefully this momentum can be maintained throughout 2018 and will bolster this progress further.
Further positives can be seen in the City Deals being developed for Cardiff and Swansea – these share a common goal for more innovative, forward-thinking, synergised and prosperous regions. Hopefully similar strategies for north and mid Wales will reinforce this strategy across Wales and there will be a decision on the long-awaited and transformational Swansea Bay Tidal Lagoon.
The South Wales Metro will improve infrastructure across the region and support a more efficient and productive workforce as well as those doing business in the region. It is important that this becomes reality and that other infrastructure projects such as the North East Wales Metro also move forward.
The UK Industrial Strategy sets out a long-term aim to boost the productivity and earning power of people across the country. It incorporates improved infrastructure, support for upskilling and eliminating skills gaps, and coupled with the rise of Artificial Intelligence, presents a robust, cohesive approach. The ACCA apprenticeship scheme here in Wales shows how business and education providers can work together to help address skills gaps and develop future talent pipelines. I keenly await the Wales economic strategy, hopeful that it will complement the UK strategy.
Refreshingly, Trade, Talent and Tech were key themes to emerge time and time again at ACCA Cymru Wales’ recent annual conference – Prof Dylan Jones Evans delivered an excellent analysis of the challenges and opportunities we face.
Our members (now over 200,000 worldwide) lead, support and advise organisations of all sizes across geographies and economic sectors and are committed to continuing to do so.
Meaningful collaboration between the governments in Westminster and Cardiff Bay and similar cohesion between business and higher and further education must be maximised, with innovative schemes such as Be the Spark leading the way in supporting entrepreneurship.
And Cardiff City may be promoted (apologies to all Swansea fans!).
Nadolig Llawen a Blwyddyn Newydd Dda i chi gyd.