The Times March 21, 2006

Brown's vision: prepare to head East and sell Britain
By Philip Webster, Political Editor

EXPERTS from the private sector are to be brought in to help Britain to sell its strengths in China, India and other emerging nations, in an attempt to make it the best place in the world to do business, Gordon Brown will announce in his Budget tomorrow.

The Chancellor is set to outline a shake-up for UK Trade and Investment (UKTI), the agency responsible for marketing Britain abroad, under a new chief executive, Andrew Cahn, who was industry director at British Airways. Mr Brown wants a “transformation” of the agency so that the British economy is sold in an aggressive and ambitious way.

Officials say that it operates like an offshoot of the Foreign and Commonwealth Office and its efforts are too thinly spread across too many countries. It will be seen, in effect, as a privatisation.

For his tenth Budget, Mr Brown is also understood to have prepared a big package of measures to boost Britain’s research effort in schools and universities, and to increase investment in research and development.

Mr Brown will outline a new strategy for marketing Britain’s strengths. The UKTI has about 1,300 staff overseas, most of whom are either locally employed or Foreign Office or Department of Trade and Industry employees. It operates in 123 countries.

He will ask Mr Cahn to transform the way that Britain is marketed, particularly in high-growth countries such as India and China. He wants the body to work with the academic and business communities and deploy a new cadre of technology specialists to attract more business research and development to Britain and promote Britain’s innovative firms abroad.

Sources said that Mr Brown wanted a fundamental shift in the UKTI from an administrative to a commercial culture, replacing Civil Service administrators with private sector expertise, and focusing on key markets.

A government source said: “UKTI needs to be proactive and ambitious, and focus its efforts on marketing the UK where the opportunities are greatest. We have built the platform for the UK to become the best place in the world to do business, but we must now take the steps to boost our competitiveness further and market ourselves more effectively abroad.”

Mr Brown is widely expected to deliver an upbeat assessment of Britain’s economic prospects. Officials said that he would dismiss the arguments of George Osborne, the Shadow Chancellor, that it is losing out to low-tax, low-wage economies in Eastern Europe and Asia, and instead hail Britain as the emerging world centre for high-tech industry, scientific discovery, financial services and education, which last year attracted more foreign direct investment than any other nation and more than all the leading European industrial nations COMBINED.

He will publish Treasury research claiming that Britain is well placed to grasp the opportunities of globalisation. He will claim that it is the most stable economy in the world, with low inflation, low interest rates and rising growth, flexible labour and product markets with record levels of employment and still rising numbers of job vacancies, and a tradition of openness and internationalism.

Mr Brown will also defend Britain’s record on productivity, publishing a Treasury study showing that productivity has grown in every year since 1997.

Mr Brown will say that, across sectors as diverse as financial services, aerospace, pharmaceuticals, creative industries and design, science and medical research, Britain is a leading world centre, attracting multinational companies to set up headquarters in London.

However, he will add that — as globalisation expands and new sources of competition continue to grow — Britain cannot be complacent, and the Budget must take further steps to lock in these advantages and boost Britain’s competitiveness in these key sectors.