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Government launches industrial strategy to 'hardwire' investment into UK

Real estate figures meet government as it focuses on eight 'growth-driving' sectors
UK chancellor Rachel Reeves. (Hollie Adams/Bloomberg via Getty Images)
UK chancellor Rachel Reeves. (Hollie Adams/Bloomberg via Getty Images)
CoStar News
October 14, 2024 | 1:38 P.M.

The government has published proposals for an "industrial strategy" that it says will give confidence to investors for the next 10 years and beyond.

Delivered by Business Secretary Jonathan Reynolds and Chancellor of the Exchequer Rachel Reeves, the green paper paves the way for a strategy that the government hopes will drive long-term growth in key sectors that is sustainable and spread across the country.

The document, launched ahead of the government's first International Investment Summit today (14 October) in London, is focused around "eight growth-driving sectors", including: advanced manufacturing; clean energy industries; creative industries; defence; digital and technologies; financial services; life sciences; and professional and business services.

The Chancellor will close today's summit and take part in a panel event discussing investment opportunities in the UK with group chief executive of Universities Superannuation Scheme Carol Young, chairman and chief executive of BlackRock Larry Fink and CEO of Brookfield Asset Management Bruce Flatt.

Tackling barriers to growth in the UK's highest potential growth-driving sectors and places is at the heart of the plans, the government said, alongside creating the right conditions for increased investment, high-quality jobs and "ensuring tangible impact in communities" across the county.

A statement on the Treasury website said: "Our strategy will create a pro-business environment to capture a greater share of internationally mobile investment in strategic sectors and motivate domestic business to boost their investment and scale up their growth."

The green paper adds that the industrial strategy will look to place private business, entrepreneurship and innovation "at its heart", with the government playing its part by "upholding the rule of law and macroeconomic stability".

Microsoft UK chief executive Clare Barclay, becomes the chair of the Industrial Strategy Advisory Council. The group will be responsible for "inform[ing] the development of the Industrial Strategy through its expertise and latest evidence, working with business, trade unions, devolved governments, local leaders, academia and stakeholders".

Reynolds said in a statement: "Our modern Industrial Strategy will hardwire stability for investors and give them the confidence to plan not just for the next year, but for the next 10 years and beyond.

"This is the next step in our pro worker, pro business plan which will see investors and workers alike get the security and stability they need to succeed. Clare’s wealth of talent and experience will help ensure the Industrial Strategy delivers its mission of unleashing the potential of high productivity sectors to spur growth, spread wealth, and drive-up employment across the UK."

Supply chain taskforce

At the same time the government has also formed a supply chain taskforce that will work to "assess where supply chains critical to the UK’s economic security and resilience could be vulnerable to disruption". It will ensure Whitehall is working with business to address any risks, "building the conditions required to deliver secure growth".

The Industrial Strategy and growth-driving Sector Plans will be published alongside the Spending Review in Spring 2025, with the government seeking feedback from councils, businesses and trade unions. Businesses have until 24 November to respond.

Those attending the International Investment Summit will also hear Sir Keir Starmer pledge to get rid of regulation where it is "needlessly holding back" investment. He will pledge to do "everything in my power to galvanise growth" by getting rid of regulation that is unconducive to business, including in the data centre and warehouse industries.

"We will rip out the bureaucracy that blocks investment and we will make sure that every regulator in this country take growth as seriously as this room does," he is expected to say at London's Guildhall today.

The government will ask the Competition and Markets Authority to prioritise growth, investment, and innovation through its work as a priority, and it will also be reviewing the focus of other major regulators.

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