Siemens pro­vides a warm glow as ‘Beast’ could hit GDP

Yorkshire Post - Business - - BUSINESS - Mark Casci Email: Twit­ter: @MarkCasci

THE NEWS that in­fra­struc­ture gi­ant Siemens is to in­vest more money into York­shire came at the end of a tough week for the re­gion.

As we all strug­gled to deal with some of the cold­est and most dis­rup­tive weather seen for some years, it was a wel­come de­vel­op­ment to hear that a mul­ti­mil­lion pound train fac­tory would be con­structed in Goole.

Huge credit should go to Siemens for hav­ing the fore­sight to recog­nise that, just as its wind tur­bine fac­tory in Hull has shown, York­shire’s in­dus­trial prow­ess can bring pow­er­ful ben­e­fits to its busi­ness.

Recog­ni­tion must also be handed to the likes of East Rid­ing of York­shire coun­cil, the re­gion’s MP An­drew Percy and the lo­cal busi­ness com­mu­nity at large for cre­at­ing the con­di­tions needed for a world-lead­ing cor­po­rate gi­ant to choose this re­gion for such a key project.

The news helped to warm hearts af­ter a bit­terly cold week and one which is go­ing to freeze more than just wind­screens.

Es­ti­mates from var­i­ous economists and fore­cast­ers have put the bill the cold weather has brought at around £1bn a day as the cost of de­layed and can­celled jour­neys, lost work days, re­duced foot­fall and de­layed in­fra­struc­ture work mounts up.

What is more trou­bling is the ef­fect it has on the wider pic­ture of our na­tional fi­nances, with some es­ti­mates pre­dict­ing it could re­duce the first quar­ter of GDP fig­ures by as much as 0.2 per cent.

Our pre­dicted GDP growth is al­ready the weak­est in the G7 na­tions and a drop of 0.2 per cent would half the pre­dicted 0.4 per cent growth we are fore­cast to record.

It should serve as a pow­er­ful in­di­ca­tor of how pre­car­i­ous our na­tional fi­nances are that growth fore­casts can be halved by a down­turn in the weather.

The Siemens deal was an­nounced on the same day as the lat­est heav­ily-trailed speech from Prime Min­is­ter Theresa May. Any­one hop­ing for more clar­ity was dis­ap­pointed but the tone the Prime Min­is­ter struck this time was more in tune with the cur­rent sit­u­a­tion the coun­try faces.

In a sec­tion de­tail­ing the “hard facts” that need to be recog­nised about the de­bate, Mrs May said “we both need to face the fact that this is a ne­go­ti­a­tion and nei­ther of us can have ex­actly what we want”.

This much has been ev­i­dent for some time. As I said back in Septem­ber, the set-up we as a coun­try will likely have in terms of our re­la­tions with the rest of the world af­ter we exit the Euro­pean Union is un­likely to please any­one. It will in­volve de­part­ing the EU but have some el­e­ments of align­ment left in place.

Hard facts are hard for a rea­son. It is the eas­i­est thing in the world to tell peo­ple what they want to hear, or to give into the al­lur­ing pull of iden­tity pol­i­tics and con­fir­ma­tion bias.

But the only way we can move ne­go­ti­a­tions like these, and by ex­ten­sion our na­tional pros­per­ity, is if we agree to a spirit of com­pro­mise. It is a spirit we as a na­tion, and those lead­ing the ne­go­ti­a­tions in Brus­sels, must em­brace.

If we con­tinue to jump on ev­ery scrap of in­for­ma­tion about the econ­omy as proof of the im­pend­ing doom or glory Brexit is go­ing to bring us we are do­ing the na­tion’s fu­ture a dis­ser­vice.

The de­bate is pal­pa­bly caus­ing is­sues for the na­tional econ­omy. Just this week Na­tional Grid chief ex­ec­u­tive John Pet­ti­grew

Fi­nan­cial was quoted in the Times

as say­ing that lack of clar­ity over Brexit and pro­posed Gov­ern­ment in­ter­ven­tion in the en­ergy mar­ket were spook­ing in­vestors.

That is why we must cel­e­brate the likes of the Siemens deal and the many other large deals com­ing out of York­shire.

The End­less turn­around of BAI re­ported on the front page to­day is an ex­am­ple of the global ex­cel­lence we can achieve.

We can­not deny the re­al­ity of the na­tion’s eco­nomic fragility. But if we keep talk­ing it down we are do­ing no­body any favours, es­pe­cially when it re­mains on such thin ice.

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