Doha, August 24 (QNA) – Qatar National Bank (QNB) considered that the comprehensive reform of the urban planning system, the establishment of a national fund to increase investment, and the improvement of trade relations with the European Union and other trading partners are all measures that support increasing long-term economic growth in the United Kingdom.
In its weekly report, QNB discussed three priorities for the new government in its mission to achieve stronger economic growth rates in the long term. First, there are several proposals under preparation to enhance the country’s housing infrastructure, support new investments, reduce bureaucracy, and reduce project costs.
The UK’s planning system is expensive and overly stringent, the report said. The lengthy and unpredictable process of issuing planning permissions significantly increases the costs of property development, hampering residential and commercial construction as well as infrastructure projects. The system remains very costly for the economy, with the country seeing no increase in built-up land per capita since 1990, in stark contrast to other G7 economies.
This has contributed to a lower rate of business investment compared to peer countries with less stringent building planning regulations, he added. UK Chancellor of the Exchequer Rachel Reeves has pledged to reform the National Urban Planning Policy Framework and “build Britain back again”, proposing a target of building 1.5 million homes in the next five years. This reform will be a key pillar of the UK’s strategy to boost economic growth.
The second priority identified by the report is the creation of a new National Wealth Fund to mobilise capital and increase investment in priority sectors. Since 2000, public and private investment as a share of the UK economy has been below the average for G7 economies. It is therefore not surprising that the new government is taking steps to increase investment. Although the mandate and organisational structure of the new fund have yet to be determined, it is expected to work closely with private financial institutions to channel resources into key economic sectors such as ports, steel, carbon capture, green hydrogen and manufacturing. The government has pledged £7.3 billion ($9.7 billion) to the project, and expects to “crowd in” investment from the private sector, attracting £3 for every £1 invested by the government, the report said. By leveraging private sector resources, the National Wealth Fund will be able to overcome financial constraints and increase investment to levels consistent with higher rates of economic growth.
Addressing the third priority, the report saw the government’s planning to promote trade as a key pillar of its strategy aimed at achieving stronger growth rates. New legislation is expected to facilitate alignment with EU product standards. This regulatory alignment will reduce uncertainty and additional costs for companies as a result of adapting to EU rules.
The report added that, after negotiations were halted due to the elections, the United Kingdom resumed talks with India, the Gulf Cooperation Council countries, South Korea, Switzerland and Turkey to reach new trade agreements.
The report explained that given the importance of global value chains, obstacles to trade affect trade exchanges with all partners, and increasing trade obstacles affect the costs of foreign supplies, which reduces the competitiveness of production in the United Kingdom, and the ability of companies to reap the benefits of international trade.
The report indicated that improving product compliance with EU standards and concluding new trade agreements would enhance external competitiveness and open new markets for businesses, providing an additional boost to growth.
