(qlmbusinessnews.com via bbc.co.uk – – Mon, 27 Nov 2017) London, Uk – –
Two pharmaceutical firms have said they will invest more than £1bn in the UK, creating about 1,850 jobs.
MSD, known as Merck in North America, will support a new research centre in London creating around 950 new posts.
Germany’s Qiagen will develop a genomics and diagnostics campus in Manchester, creating up to 800 jobs.
The government said these biotech deals illustrated confidence it its industrial strategy, the details of which it is publishing later.
Business Secretary Greg Clark said the investments represented “a huge vote of confidence” in the government’s plans.
“People don’t make the investments of this scale that are for the long term if they don’t have the confidence that we are building in this country a very attractive base,” he said.
- Will the government’s economic medicine work?
- Why isn’t the UK more productive?
He said the government’s white paper on industrial strategy would set out how the UK’s strengths in life sciences, financial services, advanced manufacturing and the creative industries would be maintained and enhanced.
The strategy comes just days after official forecasting body the Office for Budget Responsibility (OBR) announced an aggressive downgrade of its UK growth forecast.
The OBR concluded that a slowdown in the growth of productivity – or the value that each worker produces – since the financial crisis will persist for several more years.
The white paper will outline how “sector deals”, such as within the pharmaceutical industry, will link government funding and policy to investment from private firms.
MSD’s managing director in the UK and Ireland, Louise Houson, linked the company’s investment to the government’s approach to the economy: “This investment presents a major opportunity for us to work in collaboration with the UK government to build on the forward thinking and ambitious industrial strategy white paper being published.”
The chief executive of Qiagen, Peer Schatz, said the involvement of the University of Manchester, the NHS Trust and the UK government were “essential” to the partnership they are investing in.
Mr Clark said the UK’s decision to leave the EU meant the strategy was “even more important” and he said political commitments to limit immigration would not hamper the development of research related industries. He said the government would “make it easier for more scientists to come and work in the UK”.
Political parties and business groups have said that the solution to creating stronger growth and higher wages is more investment.
The industrial strategy is expected to outline similar partnerships to the MSD one with other private sector firms in the construction, artificial intelligence and automotive sectors.
The government said the deals would be “strategic and long-term partnerships”.
Here’s the idiot’s guide to how it’s supposed to work.
Pick an industry that the UK is already good at and needs investment.
Chuck in a bit of government money, cluster the right institutions around it, commit to provide the skills base and give them somewhere to try their new stuff.
That could mean faster trials for drugs in the NHS or using public roads to test driverless cars.
Hey presto – private investment ensues.
Some will see this as another example of government’s dodgy track record in “picking winners” – the government insists it is backing excellence.
Of course, all of these new initiatives are being born under the star sign of Brexit which makes them children of uncertainty.
The government has already pledged to invest an additional £80bn in research and development (R&D) over the next decade.
The additional funding is aimed at putting the UK’s investment in R&D on a par with other advanced nations.
Currently the UK spends 1.7% of its gross domestic product on R&D, much lower than the 2.4% average of developed countries in the Organisation for Economic Co-operation and Development.
As part of its industrial strategy, the government is also expected to outline the main global trends which it believes the UK needs to tackle to revive its flat-lining productivity.
These are expected to include artificial intelligence, clean energy such as low carbon technologies, medical care for an ageing population and future mobility such as driverless cars and drone-delivered goods.
“More decisions about our economic future will be in our own hands and it is vital that we take them,” Mr Clark said.