Economic news Embassy 11 September 2008
Riding out the storm UKTI chief
With global financial markets in turmoil, UK Trade and Investment chief Andrew Cahn briefed economic counsellors on how his organisation was responding to the crisis.
Speaking at an AERL seminar, Cahn urged economic attachés “to look beyond the short-term slowdown,” adding that while Europe and America were in the grips of a financial crisis, there was some “buoyancy” in the Gulf states, China, Russia and South Asia.
“The world is changing,” said Cahn, whose £250m-budget organisation added value to the tune of £3bn to the British economy last year.
Resources were being reallocated away from Europe and America where UKTI’s biggest network of trade offices currently are towards new markets such as “second tier” cities in China and India he said.
He added that UKTI was researching the “next tranche” of 17 new emerging economies beyond the BRIC (Brazil, Russia, India and China) countries.
UKTI has also been “sharpening its focus” on seven knowledge-intensive sectors including ICT, financial services, the creative industries, advanced engineering, life sciences and defence.
Part of the restructuring also included the transfer of Defence Exports Services Organisation from the MOD to UKTI, a move that has been very unpopular with the defence industry, not least because the defence industry had its most successful year last year, admitted Cahn.
But he said the industry needed to be managed in a less “old-fashioned” and more professional manner, particularly in the light of Lord Woolf’s recent review of BAE’s business practices following the Saudi arms controversy.
He also said the UKTI network of trade offices would have to work smarter, with more locally engaged staff members as well as a hub-and-spokes system where commercial interests in a region were coordinated from a central ‘hub’.
A ‘league table’ system of evaluation has also been introduced where independent assessors measure the effectiveness of individual trade offices.
The UKTI chief touched on common challenges confronting all trade offices balancing bureaucrats with business people and how much to charge for their consulting services, if anything.
He concluded his talk with a ‘cri de coeur’ for openness during the turbulent economic times and made a special appeal to “unblock” the roadblocks on the current world trade talks: “The worse the economic climate, the more important it is to overcome trade barriers and open up markets.”