The hidden value of England

It is easy for us to take for granted what makes England so attractive for business. But we do this at our peril but at times, it seems our political representatives don’t seem to understand what the country’s assets really are.

Foreigners, however, are a great source of insight as to what matters. And when making investment or business decisions, they look at England with the same slide rule they evaluate other countries with. But on a number of measures, England’s value is far greater than anyone in the world. Trouble is, if our politicians don’t seem understand how well we perform on these dimensions, they’ll never get the best deal for UK citizens or they’ll impair the underlying assets that make this country so attractive. It is their decisions that affect our long-term prosperity so it’s crucial to remind them what these are:

1. Stable democracy: There is no other country in the world with such a long history of democratic rule. We take it for granted but for investors long-term stability is a critical factor. The freedom of our citizens from corrupt rulers is sacrosanct and has been since Magna Carta; our island status keeps us (relatively) freed from armed conflict and our geography escapes the more extreme environmental threats – both help maintain security and stability.

2. Independent judiciary and rule of law: A rule of law that is clear, objective and consistently upheld is important to fostering a climate of trust, especially with regard contracts and disputes. Our judicial system and police force are quite simple the envy of the world.

3. Respect for private property: Property is private and cannot be taken lawfully by anyone. Funny how silly this sounds but the fact that no-one has the ability to take this away from us is an important aspect that few other countries enjoy today. Taxes are arguably one way governments legally do this but so long as this is long-term,  predictable and ‘fair’, most people don’t mind paying. Again, foreign investors value this highly.

4. Ease of doing business: Regulation, ease of registration of property, taxation, bureaucracy, these are all aspects that can create friction. England is pretty good at most and appears high up the ‘ease of doing business’ league tables. This high score coupled with the above factors, makes us as compelling if not more so than anywhere else in the world

So when politicians:

• interfere with the judiciary or police (civil liberties; judicial interference)
• fail to impose taxes consistently (politicians’ expenses), at all (Google, Amazon etc) or conversely impose stealth taxes on people and businesses;
• chop and change their thinking about important long-term investments (eg Energy supply, HS2, Trident etc),
• fail to regulate financial services and other sectors properly;
• allow our property market to be overrun with foreign money causing domestic housing shortage

they are undermining our long-term prosperity. And if you don’t believe me, ask the 400,000 French people why they live and work in London. They won’t talk about these factors but they will point to things that are built on these four pillars of prosperity.

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