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POLICY
consumer and investor. Its expenditure on road, rail and other infrastructure projects under the BRI alone in the next five years could be about £620 billion. The rise of the East has come just as productivity growth among the advanced nations of the West has stuttered. Although this deceleration was always expected, bigger questions are arising about the effectiveness of the West’s marriage of capitalism and democracy, particularly in preparing its economies for the demands of the fourth industrial revolution.
THE UK’S PROSPECTS
About a third of British business leaders responding to the IoD’s Policy Voice surveys believe that the current state of the global economy presents a serious challenge to their enterprises. A key component of this is the increasing influence of international political events
on cross-border trade. On top of Brexit, the EU – our largest trading partner – is holding parliamentary elections at the end of May. These are likely to give nationalist parties stronger representation in Brussels, which in turn has implications for the EU’s trade and growth policies. Moreover, Trump is a president without precedent. His rule-by-tweet approach and his ongoing protectionist skirmishes are adding to the volatility that international businesses have to manage in currency and stock markets. The West’s regression as an exemplar and promoter of liberal free-market values is having a significant impact too. Political rights and civil liberties have continued to decline across the globe over the past decade, according to Freedom House, a think-tank funded by the US government. Populism and nationalism are taking hold in once-promising emerging economies, where questionable styles of government have heightened both political instability and the reputational risks facing western companies operating in those territories. The Brics, Indonesia, the Philippines and Turkey are among the nations where British companies are reporting particular concerns. In the face of these strengthening geopolitical headwinds, there has been a notable trend towards bringing activity closer to home. Now intra-regional trade and investment is on the rise. The world that Global Britain hopes to open up to could be increasingly regionalised.
WHEN CHINA SNEEZES… The biggest exporter in the world and the second-biggest importer after the US, China has become a barometer of the
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