End investor exodus, bosses urge Sunak

Tesco chairman is among business leaders telling Prime Minister to deliver a long-term growth plan

BUSINESS leaders have warned Rishi Sunak to draw up a long-term plan to boost economic growth and stop investors fleeing Britain.

As pressure mounts on the Prime Minister to cut taxes, the Tesco chairman, John Allan, said the only way to raise living standards was with a “really serious, thought-through, long-term growth plan”.

He said the Government had been too focused on dealing with short-term crises and said efforts must be directed towards Britain’s long-term future.

It follows comments from the entrepreneur James Dyson in The Daily Telegraph this week, in which he warned that the “short-sighted” and “stupid” economic approach of Mr Sunak’s Government is keeping Britain in a state of “Covid inertia”.

Siemens, which employs 10,000 people in the UK, said the company would be more likely to invest if the UK’S growth prospects improved. Matthias Rebellius, a member of the German industrial giant’s managing board, agreed it was important to focus on long-term growth, as he warned that the current approach to attracting investment was too sprawling.

Asked if the UK was currently a good place to invest, he told The Daily Telegraph: “I would say it could be better.”

Mr Rebellius, who was speaking on the sidelines of the World Economic Forum in Davos, stressed that Britain would remain an “important” partner for the German company.

He added: “We will stay in the UK. We will keep our workforce. We will continue to invest. Is it the best possible business environment at the moment? It’s not. I think the UK Government didn’t have any alternatives in raising taxes to fill the holes.”

Mr Rebellius added: “But now going forward, together with the Government, we have to find solutions on how to do it smarter. It’s our responsibility as a company to create opportunities. But we do hope that the situation will ease in new terms.”

The Tesco boss said he remained “an optimist” about the UK economy.

Mr Allan told the BBC: “There is nothing irretrievable about the UK economy. I’m an optimist in the long term but in the short term I think we have some issues and those issues are having an impact on investment.

“We have got to demonstrate that we know our way forward, restore confidence and we could actually see a reasonable return of inward investment.”

He added: “I think this year is going to continue to be very tough for any of our fellow citizens. Our hope is that inflation will start to reduce probably around the middle of the year and will be somewhat lower around year end but for the avoidance of doubt that doesn’t mean prices are going to fall.”

Separately in Davos, the head of the International Monetary Fund warned that a full-blown trade war could wipe $7trillion (£5.6trillion) off the global economy.

Kristalina Georgieva took aim at Joe Biden’s green subsidies as she set out her fears about what would happen if “we trash trade” in response to policies aimed at combating climate change.

The US Inflation Reduction Act (IRA) contains sweeping subsidies and tax cuts worth around $370bn for reducing greenhouse gas emissions, making it the largest-ever US programme to combat climate change, and includes provisions to buy Us-made goods.

The European Union is considering responding in kind.