Written by Frank Holmes, Chair CCR Economic Growth Partnership and Investment Panel.
In Cardiff Capital Region we constantly think and talk a lot about our plans to expand our regional economy by stimulating the growth of local businesses, particularly in the key sectors of strength, notably compound semiconductors, fintech, medical devices and diagnostics, data, cyber security and creative industries.
Make no mistake, we have a lot of inspiring homegrown businesses in these and other sectors of which we can be proud. Our investment strategy is based in part on mobilising our City Deal funds towards helping businesses grow whilst boosting the development of clusters in those sectors of competitive advantage on a world stage
A compelling destination for inward investment
But it has never been about solely helping local businesses, however important they are to a sustainable and resilient regional economy. We also want to attract inward investment as an essential complement to our own indigenous growth. Indeed, it is difficult to see how we could realistically have the one without the other. To achieve sustainable growth, we must also become a compelling destination for inward investment.
Concerns are often raised about luring outside firms or financial institutions to invest in Wales, partly because of a lack of investor readiness, fears that the revenues will flow out of the country or because they are deemed to have no long-term loyalty to the region. But it would be foolish to ignore the benefits inward investment brings in terms of job creation, supply chain stimulation, and vital importation of knowhow and expertise. While we are doing our best to encourage the growth of indigenous enterprises, we cannot underestimate the need to draw in resources from outside.
We start with many advantages
The key to ensuring that inward investors want firstly to deposit their money here, secondly to set up base and stay, requires a competitive offer which highlights the attractiveness of our region. We must become less humble, more ambitious because we start with many advantages. While we often complain about our transport connectivity issues, the M4 being a justified example, our main cities are within two hours of London by road and rail. We have an international airport at Cardiff, with plans to expand, and another nearby at Bristol. We are investing in improving our internal connections with the South Wales Metro, the single largest investment in the City Deal. We are well connected to the rest of the UK and to Europe. Our digital infrastructure is being addressed with ambitious programmes and we will adapt to the UK 5G strategy like everywhere else.
We have a skilled workforce, with thousands more qualified graduates coming out of our universities every year which we want to retain. These universities also produce world class research, which is an essential component of the success of our medtech, digital and semiconductor sectors. Our higher and further education institutions, along with other training providers, supply continuous training in appropriate skills to people of all ages. However, both of these education sectors will need to align their provisions with the skills of the future and the changing world of work, as is everywhere else in the world.
We have good quality, affordable accommodation in a diverse region which has unique offerings as a place to live, as well as a providing a wide range of cultural and social activities. It is, frankly, a hard region to beat for quality of life.
Collaboration is key
We must and can boast of our overwhelming appeal as a region, but of course other regions will be making a similar pitch. We need also to demonstrate our seriousness and commitment to making a success of south east Wales. This will take the highest level of collaboration and cohesion between different levels of government, from UK and Welsh governments and local authorities, as well as between public sector partners, the private business sector, social enterprise, academia and education. We all need to be working together, implementing policies and strategies that make the case for incomers to invest alongside our own growing businesses and clusters. Collaboration is the word of the 20’s, particularly with the need to face up to the Covid-19 new normal way of life whilst rebuilding the economy.
In Cardiff Capital Region we are also building for the long term. Our City Deal investment strategy is focused on a 20-year growth path. However, ultimately, we see the Capital Region going beyond the City Deal, growing into regional Development Agency, representing the region in the Western Gateway which unites us with the West of England, and selling the region as an investment destination around the world. We also need to make sure that higher levels of government, particularly in Westminster, do not overlook the region when it comes to ‘levelling up’ and the Shared Prosperity Fund.
Attracting inward investment and stimulating business growth are not either-or choices, they are two sides of the same coin. Without a healthy regional economy based on world-leading clusters in innovative, niche sectors within industries of the future, embracing clean growth and the shift to net zero, we will not attract outside investors. Without drawing in investment resources from outside, those clusters and our regional economy will not grow to their fuller potential. That’s why foreign direct investment and leveraging external finance are critical targets, vital for the ambitious future and well being of the Cardiff Capital Region and its contribution to a more prosperous Wales.