Dr Mohan Kaul

India

2012-01-31T09:37:00.001Z

When I return to India I am always amazed at just how much is happening. There is no such thing as a slow news day, being in India is always exciting.

Right now India is growing and is going to continue growing at about 7%. The RBI Governor is equally confident that inflation will slow over the course of the year. But it is the businesses that are driving India’s growth, new and young Entrepreneurs, IPOs and numerous mergers and acquisitions are keeping the Economy moving. However, big business continues to worry about the cost of borrowing and likely power shortages and the delays in policy decisions that can make this worse. On a separate note, one of the things Indian business can be proud of is the number of women in high level positions, particularly in the Banking and financial services sector, many other countries are still striving to accomplish this.

In my view there are 2 issues haunting India, poverty and the lack of a perceived solution.

India is blessed with many self motivated individuals that are willing to dedicate their time and money to changing the lives of the poorest in society. However despite successful grass route initiatives a large scale political solution to poverty seems a long way off. There is lots of political and social debate but the state of politics at the moment is not helping with quick decision making or long term solutions.

Similarly in the field of Anti-Corruption, there is a strong civil society lead campaign to make democracy more participatory and to help reduce corruption by attracting more able candidates. Again this is being driven by successful individuals including NRIs rather than the political classes.

My final observation, the more I travel in India the more impressed I am at how unimportant caste and religion are becoming across society. They no longer play a role in most of the interactions you have in both the Cities and rural areas. However in political discussions and across the media there is a huge amount of time dedicated to it. I do wonder if this energy was spent on the wider poverty issue there might be more progress.

None the less, India is still a truly vibrant and emerging nation that is a beacon for democracy and economic growth.

Commonwealth Growth and the UK

2012-01-10T17:22:00.001Z

2012 has started with the same economic uncertainty that 2011 ended with and the UK needs to look for Partners around the world that are growing fast that can supplement the UKs existing relationships in Europe and US. The Commonwealth’s emerging markets are the obvious choice, our pre-existing relationships make doing business together easier and similar institutions and business methods can bring the cost of doing business down by up to 20%. Most Commonwealth Countries will grow at over 5% this year and all represent colossal opportunities for British companies.

Historically, Britain used to count countries such as New Zealand, India, Australia, Singapore and Canada among its leading trading partners.

Since joining the European single market, Germany, France, Holland and Belgium have assumed far greater importance to us while only five Commonwealth countries struggle to make it onto the list of top 25 export destinations.

However times could be changing. The latest overseas trade statistics show the biggest increase in exports are to our Commonwealth partners and if trends continue they are set to play a far more important part in our economic life.

In the 12 months up to the end of September our exports to India – roaring ahead with 9% growth – increased by a whopping 33.5% compared with the same period a year earlier.

Exports to Canada jumped 18.3% in the same period and those to Australia were up 30% while those to South Africa rose by 31%.

These are good improvements but there is massive potential in the Commonwealth and Britain should be at the forefront taking advantage of it.

2011

2011-12-21T21:12:00.001Z

2011 was a unique year for CBC; we started with year with a renewed focus in Infrastructure, particularly Power which is critical for most of the Commonwealth’s countries.

In February we held the first Commonwealth Ministerial Power Summit that build on our work with the Nigerian Government on the Power sector privatisation plans and brought together stakeholders in the Power Sector from India, the Caribbean and Africa.

We have held Country Investment Forum’s in Namibia and Zambia hosted by the respective Heads of Government and Regional Forums focusing on Infrastructure in SADC, EAC and the Caribbean. However the highlight of the year was the Commonwealth Business Forum held in Perth alongside CHOGM. The Forum was the biggest we have ever held, bringing together 16 Heads of Government and 1400 business leaders from 70 countries across the Commonwealth and beyond.

We are proud of what we have achieved over the last year; we have seen considerable investment in Infrastructure particularly power and Transport. Additionally, this year has seen large investments in the Mining sectors of Nigeria, Namibia, and Mozambique. In Oil and Gas, investment into Nigeria, Uganda and Trinidad and Tobago, interestingly there have been high levels of south-south investment in this sector.

The Commonwealth Business Forum alone resulted in nearly $10 billion invested in Africa from Australian Companies. But a true highlight of the year, and a real indication of how much the world has changed over the last decade that CBC has been operating, was introducing a Tanzanian businessman to the Prime Minister of Australia as the latest investor in her countries Mining Industry.

I'll also take the chance to wish you all a Merry Christmas and a Happy New Year

India and the UK

2011-11-24T10:14:00.002Z

India and the UK have a long established partnership that manifests in many ways; the links between our 2 countries are strong and healthy and there is much room to grow.

In 2010, bilateral trade between the UK and India grew by 20%, bringing the total to £13 billion. UK goods exports to India grew by 37% and goods imports from India rose by 27%. However, despite an overall growth in exports from the UK, the country’s comparative position has been slipping. In 2005 the UK was the 5th largest exporter to India, whereas the UK is now the 18th largest exporter. India is the 13th largest export market for the UK, while the UK is India’s 5th largest export market, accounting for 3.6% of all India’s exports. There is a general view that the relationship is under –utilised.

The potential for growth in trade and investment between the UK and India is huge as reflected by Indian Prime Minister Manmohan Singh when declaring last year that the 2 countries ‘should aim at the doubling of our bilateral trade turnover in the next five years’. However as the British Prime Minister David Cameron summed it up while in India ‘we cannot rely on sentiment and our shared history’ to make this happen.

1) Firstly, UK companies operating in India

2) Secondly, Indian Companies that use the UK as a base to raise capital and to operate abroad

3) Thirdly, related to the Second point, but Indian companies that operate in Britain, but are fully engaged with the UK’s economy.

Britain in India
British Business has a strong presence in India and has for many years. Many of the UK’s big names are present, Arup, Mott Macdonald, Serco, Amec, JCB and Unilever.

The success of the expanding Indian economy is widely acknowledged by UK investors. The most recent being the set up of ‘India Gas Solutions’ by BP and Reliance Industries in a $7.2billion investment focused on global sourcing and marketing of natural gas in India. This is one of the largest ever foreign investments into India and clearly demonstrates the continuing importance of each country to the other.

As access to India’s services sector grows, I have absolutely no doubt that the UK will jump up the league table of bilateral trade and investment flows almost overnight. The India-EU trade pact that is reportedly to be completed in the New Year should help with this.

India in the UK

Of all the Indian Companies operating in the European Union there are more in the UK than the other 26 EU nations combined. The London Stock exchange is host to 31 listed companies, 20 more than New York, and many more than Singapore and Hong Kong. Most of the Indian companies operating here do so to take advantage of the City of London as a financial Hub, as an access point to Europe and as a Geographical bridge between the East and the West. I hope this will remain the case in the future.

Essar Energy is a good example of a fast growing company that used London in this way; they raised US$2 billion through an initial public offering in May 2010.

I believe that if we want such partnerships between India and the UK to grow and strengthen, then the City of London’s pre-eminence must be protected. With regards to the proposed ‘Tobin Tax’, the UK’s strong stance against it is sensible. If the British Government gives an inch by way of the financial services tax they will lose a mile in international business.

The Second Category of Indian Company operating in the UK are the fully engaged ones – like TATA.

Tata is now the UK’s biggest manufacturer, with almost 40,000 workers. When including Tata's service industries, such as consultancy, the Company is the largest private sector employer in the UK.

This is a Model that can be especially fruitful for both countries. Key to ensuring this is converting the Indian Companies that are in London to take advantage of the City into fully integrated Companies along the Tata Model.

There is also great scope for synergy with high end engineering design and mass marketing. It is what James Dyson did in China, but the only problem is that Dyson products are now made in China without any involvement from Dyson due to weak IP regulation. This would not happen in India.

Tata has demonstrated how profitable working with a pre-existing British firm can be by buying into existing brands. Let the British design and the Indians scale up.

In reality, India and the UK have an existing partnership that will continue to grow slowly on its own, but if we want to turn it into a true 21st Century Partnership it requires a catalytic intervention from Governments and the private sector. The ‘sea change’ that both Governments called for during David Cameron’s visit to India last year will not happen unless the relationship is managed and developed actively. I would like to see more direct involvement from top Indian and British business leaders.

Commonwealth Business Forum 2011

2011-10-29T03:02:00.000+01:00

Commonwealth Business Forum 2011

Perth, Australia, 25th -27th October 2011

Partnering for Global Growth: The Commonwealth, the Indian Ocean and the Pacific Rim

Communiqué and Report to Heads of Government (CHOGM)

The New Commonwealth

This has been the biggest and most vibrant Commonwealth Business Forum ever. Over 1400 business and government leaders from 54 countries participated over the three days, including 16 Heads of Government. 150 global business leaders and experts addressed the Forum and we held 20 country/state investment windows, including 6 led by Heads.

The CBF is a growing part of the CHOGM experience, evidence that trade, investment and economic partnerships are now part of the lifeblood of the new Commonwealth. In the words of Australia’s leading financial title, “a new kind of Commonwealth was on show” in the Perth CBF, which can aid the revival of the association and make it relevant to the modern world. We expect this “rebranding” will enhance the role and strength of the Commonwealth further.

We therefore ask Heads of Government to reshape the way the Commonwealth works and focus more on cooperation for trade and investment, jobs and growth to complement its work on good governance. CBC is willing to mobilise the Commonwealth private sector in this effort under the leadership of the incoming Commonwealth Chair in Office, the Prime Minister of Australia.

The Commonwealth and the Investment Climate

The business leaders and experts agreed that the majority of the Commonwealth - including developed as well as developing countries - are better placed than many to weather the current economic turbulence. Commonwealth countries are investment destinations of choice, have high governance and business standards. The World Bank and international agencies recognise that these standards continue to rise. It is important to maintain this momentum. Australia, as a successful developed economy and chair-in-office is in an excellent position to lead this Commonwealth effort.

Global Outlook

The attention of the business community is now on the overall health of the global economy. Economic forecasting is not the purpose of the CBF, but the dangers of a double dip recession in Europe and North America, with collateral damage to all emerging markets is real. At the same time, the underlying changes occurring in the global economy continue to point to a long and historic cycle of growth. 4-7% growth rates in emerging markets are now a long-term norm, part of the embedded structure of the new world economy.

While national and personal debt levels in many larger economies are high, one bright light is that globally, corporate balance sheets and reserves are in very good shape. This illustrates the importance of governments taking firm action to manage markets and fiscal systems to promote confidence, so that these capital resources can be used to invest in growth.

The opportunities for growth in the next century revolve around biotechnology, information technology, green growth and renewable energy. Governments need to work with the private sector, universities and civil society to harness technology to create sustainable growth.

Free Trade and Open Markets

We welcome the leadership of the Australian Government in committing to zero tariffs for emerging economies, and we urge leaders to explore ways in which bilateral and multi-country agreements can be advanced to promote growth.

Public Private Dialogue

The importance of dialogue between governments and business at a global and national level has never been greater. This is illustrated by the discussion of a number of key topics –climate change, infrastructure, and natural resources that remain fundamental to development in all economies. There is a declining trend line in available public funding. Private capital can take up the slack, but this requires a clear and predictable rate of return. This is a further example of how well managed public private partnerships are needed to facilitate investment.

The message to leaders is to stay the course to effectively manage globalisation for growth. We urge Heads of Government to focus on the following priorities: skills and education for jobs; access to finance for business growth; infrastructure development; support for SMEs; business friendly tax policies; tackle corruption and strengthen corporate governance.

The Commonwealth Regions

Africa is a new zone of economic development and growth, confidence and stability – poised to use its enormous resources to benefit hundreds of millions of its citizens.

This week’s discussions and investment sessions also reinforce the potential of an Indian Ocean economic zone – which can be built on over the next two CHOGMs in Sri Lanka and Mauritius. The ability of this region, including South Asia, to drive sustained growth is strong. Our sessions on Australia, Mauritius, Malaysia, Pakistan and Sri Lanka demonstrate this.

The Pacific is perhaps the least known region in the world with special opportunities, and we are glad to have had a delegation from 8 Pacific countries with us. New joint programmes were agreed.

The link developed with Caribbean countries was further strengthened, creating new linkages with Australia and using the Caribbean as an entry point for the Americas. We confirm the importance of small states and islands to the business promotion work of the Commonwealth.

Actions and Results

At the Forum we launched a number of practical initiatives.

1. Mining: to complement the Australian Mining for Development Initiative announced this week, we established the Commonwealth Mining Network that will help to link the private sector to the needs of Commonwealth developing governments to manage their mining sectors more sustainably. We thank the companies and chambers that have agreed to support this.

2. Skills for Jobs and Careers: to strengthen public private partnerships on employment creation and careers, we are launching an initiative to link business-designed training with career opportunities for disadvantaged citizens across the Commonwealth. The Australian covenant for disadvantaged citizens is a promising model with its link between training and guaranteed employment. We invite interested Commonwealth governments to work with CBC to establish nationally tailored programmes based on this model.

3. Enterprise: SME development is at the heart of employment creation and sustainable growth. The Australian Chamber of Commerce and Western Australia Chamber of Commerce have agreed with CBC to set up a programme with the Bank of Industry Nigeria and partners from the Pacific, India, and Africa to work with companies and governments to use their supply chains and other measures to support enterprise and the SME sector.

4. Women own up to 39% of private businesses in the formal economy but have not penetrated the global supply chain, are underrepresented on boards, and lack access to finance. CBC will work with the International Federation of Women Entrepreneurs and British Association of Women Entrepreneurs to establish a Commonwealth Businesswomen’s Network to strengthen the overarching strategy for women in business around procurement and policy.

5. We were delighted to have with us more than 60 Chinese business leaders who joined us for the discussions on Commonwealth-China cooperation, and we had our first ever CBF sponsor from China – ICBC. We signed an MOU between CBC and the China Council for the Promotion of International Trade (CCPIT) to forge greater cooperation that will launch a Commonwealth-China business network.

6. We began a new cooperation between CBC and the Pacific Forum on Pacific trade and investment.

7. We established the Australia-Nigeria Trade and Investment Council. We believe that this is a good example of how the friendships and solid relationships of the Commonwealth can be used to develop economic cooperation. If the world stands still on trade and investment reform, the Commonwealth partners can still find ways to move ahead.

8. Sport: CBC will set up a group of leading Commonwealth companies to develop the ways that business can be more involved in using sport for economic growth and jobs.

9. The Investment Promotion Agencies (IPAs) and CBC will establish a Commonwealth IPA network to share best practice and improve links between IPAs. We will set up an e-platform network and work together in preparing for CBF 2013.

10. Improving Business: to increase ease of doing business the Forum endorses consideration of a Commonwealth business visa similar to APEC. The Forum received a presentation on a Commonwealth Cybercrime Initiative, which was welcomed by business.

Finally, the deal flow discussed at this Forum is on track to deliver $10bn in new projects and investments over the next 6-9 months. We have been able to organise a large number of high-level meetings around the $100bn of projects in the CBF project exchange. We expect the thousands of 1-2-1 exchanges between delegates to lead to a healthy deal flow in 2012.

We would like to thank our more than 180 speakers and chairs of sessions, and once again express sincere thanks to Prime Minister Gillard and the Australian Government, Premier Colin Barnett and the Government of Western Australia for their support in hosting the meeting. We also express our appreciation to our Forum Steering Committee lead by John Denton and Mark Barnaba as well as each of the 50 organisations whose sponsorship made it possible, especially our principal sponsors ANZ, BP, Fortescue, Perdaman, Rio Tinto, and Woodside. A full list is annexed.

Commonwealth Business Council
Perth, Australia
27 October 2011

India and corruption

2011-09-06T14:32:00.002+01:00

The current situation in India, popular protests against corruption led by Anna Hazare, has set me thinking.

I think, particularly in a country as diverse and large as India, inclusive growth requires inclusive democracy. The wide spread protest against corruption have shown that India has an appetite for participatory democracy, and given the sheer size and scale of the Indian state ‘people power’ might be necessary to keep it in check.

If nothing else this incident has shown once again how important tackling corruption is to a country’s development, Moody’s the ratings agency says that ‘cases of corruption and the recent scandals have impaired business environment in India’. Tackling this is important before it has an impact on India’s ability to attract international business and investment and further damages the countries reputation as a safe place to do business.

Nigeria: a county of tremendous potential

2011-08-08T11:24:00.000+01:00

I was honoured to be invited to address the Business Environment Roundtable on the 2011 Nigerian Economic Road Map by the Lagos Chamber of Commerce and Industry last month to provide an international perspective to their discussions of Nigeria's development plans.

Nigeria is a county of tremendous potential that should be leading in Africa and the world, a population of 150 million people all of whom are potential entrepreneur as anyone that knows the country will be able to testify to. The Current Administration aims to make Nigeria on the world's 20 largest countries by 2020, this is achievable. Indeed, Goldman Sachs believes that with the right reforms, Nigeria would be the world's fifteenth largest economy by 2050 and Standard Chartered the largest economy in Africa by 2013.

Nigeria is making good progress - the recent elections have solidify the image of Nigeria as a working and fair democracy, even Britain's traditionally negative press could find little to complain about. Nigeria's work in securing peace and democracy in the region, particularly its vocal defence of the principal of Democratic Succession in Cote d'Ivoire, has helped elevate the county to new levels on the international stage.

The key challenge for Nigeria to tackle if it is to meet its potential is its infrastructure deficit. The Central Bank estimates that Nigeria needs to invest $100billion (about N15 trillion) over the next 10 years to fill the deficit. In the power sector. Nigeria expends about $13 billion every year providing power from diesel generators when only about

$10 billion per year is required in investment over the next few years to develop our generation, distribution and transmission capacities. Generating power from generators adds more than 40 percent to the cost of goods and services in Nigeria.

Given the scale of the investment required the only truly viable way of meeting the need is though, public-private partnership. Government needs to work closely with business, both national and international, to ensure that the funding to tackle this deficit is met.

Nigeria is going to remain a country of tremendous opportunity for investor for foreseeable future and I would encourage, everyone to look at the opportunities there for their own businesses.

Commonwealth Eminent Persons Group

2011-07-13T10:43:00.001+01:00

We appreciate the work the Eminent Persons Group has done on looking at the future of the Commonwealth, particularly there recognition of the need to Commonwealth Trade Ministers meeting. However, I have concerns that some of the key issues are not being addressed, particularly the role of the Commonwealth in advancing economic and social development.

Commonwealth Heads of Government specifically targeted these goals as new priorities in their 1997 Edinburgh Commonwealth Economic Declaration "Promoting Shared Prosperity", and set up the Commonwealth Business Council and biannual Commonwealth Business Forum to advance this. As they concluded in their 1997 Declaration, the growth and investment agenda requires "vigorous" collective efforts if it is to be advanced.

I would encourage the EPG to include a focus on 3 specific areas, in their final draft.

There should be specific mention in the proposed Commonwealth Charter of – promoting economic prosperity and growth through joint business and government partnerships. This would result in the creation of millions of new jobs, SMEs and cross Commonwealth investment which would be of benefit to all commonwealth citizens.

A clear formal cooperation mechanism between on the one hand the Secretariat, and on the other the CBC and other similar, large Commonwealth organisations should be included in the final draft. In order to deliver improved technical assistance and development programmes to support the economic development focus.

And that the achievements of CBC and CBF be formally recognised by EPG, CBF has become a uniquely valued and important part of the Heads' programme and is now seen as an integral part of CHOGM. CBC itself has become the second largest Commonwealth organisation, without any core government funding, and has raised some £30m for its own work since inception. In the last two years, 25 member state governments have worked directly with the CBC on a range of investment promotion and policy exercises linked to SME development, infrastructure, energy, and health and job creation.

I strongly support the EPG’s focus on political good governance. However, the EPG report is currently incomplete and unbalanced as it lacks a serious treatment of economic development issues.

I hope the EPG will take these points to heart, making the Commonwealth Relevant for today means making it focus on issues that are on the minds of Heads of Government, day to day. Namely, job creation, investment, business development and economic growth as well as the Good Governance and Human Rights. The Commonwealth should give equal focus to both governance and economic as they are 2 sides of the same coin.

China and the Commonwealth

2011-06-02T20:19:00.001+01:00

I was delighted to return to Beijing in May to Launch the Commonwealth Business Forum 2011 to the Chinese Market. China will be an important player in this year’s Forum given Perth’s, the host city, resource development with the country and Commonwealth’s African Members increasing relationships with Beijing. We hope the Forum can be a stepping stone to introducing Chinese companies and investment to some of the Commonwealth less well known Members.

While there I was honoured to be invited to address the China Council for the Promotion of International Trade’s annual Chinese Enterprises Outbound Investment Conference. This was the first time the Commonwealth was represented at the Conference and I was delighted to have the opportunity to introduce the 1000 plus delegates to the opportunities available in the association.

Ensuring the Commonwealth’s myriad opportunities are well recognised in China is essential given the scale of the countries overseas investment, in 2009 Chinese Companies invested US$56.3 billion dollars abroad; this was 3125 investments to overseas companies, in 129 countries. As China continues its ‘Going Global’ policy it is essential that the Commonwealth gets its share of this increasingly large pie.

Namibia & SADC

2011-05-10T14:04:00.000+01:00

I was lucky enough to visit Namibia earlier this month and call on the President, HE Hifikepunye Pohamba, to discuss CBC’s plans for the year. Namibia is a great country to visit and one that holds good personal memories for me – I was there in the late 80s and 90s running a special program on management development during the democratisation process.

I was delighted to drive through green fields and see firsthand the level of agricultural development the country has achieved – Namibia’s progress since I was last there is most impressive. President Pohamba is proud of the progress his country has made and is keen to continue pushing forward in key sectors – he highlighted education and youth unemployment as key challenges for the coming year.

The President was also keen to highlight the importance of SADC to Southern Africa’s regional economy. President Pohamba is the 2011 Chair of SADC and has assigned himself the key task of strengthening regional infrastructure projects to help move the region closer to a single market.

It is in this capacity we have invited him to address the Africa Business Forum 2011 in London in June. This year’s ABF has a strong SADC focus and addresses the theme ‘Regional Integration and Drivers of Growth’. The President will deliver the opening address at the Forum and will be supported by Ministers from the region and Dr Tomaz Augusto Salomão, Executive Secretary of SADC.

Opportunities in Zambia

2011-04-27T11:33:00.000+01:00

It was a pleasure to be in Zambia a couple of weeks ago, it is a county I have visited may times over my career and one I have always enjoyed my stays in. I was in Livingston for the Annual meeting of the Zambia International Business Advisory Council with President Banda. It was great to hear about the progress Zambia has made over the last decade since the council was set up. Zambia, last year, had the highest growth rate in Africa and the 25 highest in the world, Zambia is now one of the largest copper producers in the world and last year increased its output at a rate higher then both Chilli and China. The Country’s GDP per Capita has now reached lower middle income levels. The ZIBAC board members were universally impressed worth the progress the country has made and at how well it is doing. One of the main recommendations to President Banda was that he should increase the money spent on making sure the world knows about Zambia’s successes and possibilities – as you only need tell a bad news story once for it to be heard, but good news needs to repeated again and again…………

Following the ZIBAC meeting we held the first Zambia Investment Forum, which we co-organised with the Zambia Development Agency. The Forum brought together 50 international business leaders and investors with local project holders and government leaders to forge new partnerships and help increase the involvement of the international private sector in Zambia’s economy. 3 MoUs we signed at the Event.

The President told me that his government is stepping up its efforts to tackle its skills and training shortages in the population and recognises this can only be done in partnership with the private sector – so this will be a thriving investment opportunity over the coming years as well as good opportunities in Agriculture, Tourism and Mining.

Zambia is a great investment destination and I would encourage investors to look closely at the opportunities available there.

Mozambique

2011-04-06T10:34:00.000+01:00

I was very Grateful to have the opportunity to catch up with President Armando Guebuza of Mozambique, it was a good meeting covering many different things. Mozambique is a country CBC has a strong relationship with, and I a personal one, I have sat on the President's Advisory Council for several years now.

We discussed the challenges that President Guebuza's Government faces, particularly the recovery from the financial crisis, that's impact is still being felt in Mozambique and a growing skills shortage in the Country. The President highlighted transport infrastructure as one of his key priorities for the coming years, and was clear to point out the importance of working in partnership with the Private Sector and international agencies to deliver projects.

He was keen to highlight successful projects in Mining and Agriculture that are coming steam shortly, and show the plentiful opportunities that remain in these sectors for international investors with an interest. I was also delighted that President Guebuza has accepted our invitation to speak at the Commonwealth Business Forum to be held in Perth, where he will also chair a roundtable focusing on enhancing partnerships between the mining community in Mozambique and Australia.

Eminent Persons Group's Recommendations

2011-03-25T17:16:00.000Z

While I welcome the Eminent Persons Group's recommendations on the need for reform and greater collaboration between commonwealth agencies, what was not in the report was a great disappointment.

The report did not specify what reforms need to be conducted to ensure the association stays relevant in the future and keeps delivering for all 54 states. The statement on collaboration between agencies and Secretariat, fails to elaborate on the quality and type of technical assistance, or on the delivery of technical assistance through the Commonwealth's Key agencies outside the Secretariat. Delivering though other agencies could be key mechanism to reduce the cost of delivering technical assistance, improving is quality and reducing duplication and redundancy within the Commonwealth family. This would allow the size of Secretariat to be reduced while increasing the quality of scope of the Technical Assistance provided.

It is equally disappointing that the Eminent Persons did not talk about the Private sector and growth, as I have mentioned before, it is my belief that the Commonwealth works at its very best when giving dual focus to both the Harare Declaration on Human Rights and the Edinborough Economic Declaration. And in this time of increased economic hardships in most Commonwealth countries, private sector money is going to be more and more important. It is unlikely Governments are going to put forward large sums of new money given the pressing domestic priorities. Refocusing existing money and mobilising the private sector and other funding sources could be an answer.

As the Eminent Persons Group have said there is now real possibility of the official Commonwealth slowly moving towards the end of the road. I hope the upcoming CHOGM to be held in Perth, Australia in October will give the Association a new beginning. But given the contents of the eminent persons report, I fear it is again going to be tweaking rather than true reform.

Rwanda's Impressive Growth

2011-03-23T16:10:00.000Z

I was recently in Rwanda to brief President Kagame on CBC’s programme for the coming months and discuss his involvement in the Commonwealth Business Forum to be held in Perth, Australia later this year. This was the first trip to Rwanda where I had the chance to get out and around and see some of the Country outside of Kigali.

I was impressed by the level of development visible outside of the capital, the roads we used to travel to the new Free Trade Zones the government are setting up to promote exports are world class. And one of President Kagame’s headline schemes to get Rwanda on-line, is nearly complete – this will open up huge new opportunities across the country.

Rwanda’s success has lessons for us all, President Kagame has lead an active international investment promotion campaign that is paying dividends. Much of Rwanda’s growth is driven by the Private Sector, giving the Government room to focus on the countries social needs.

During our discussions, President Kagame was keen to highlight the emerging investment opportunities in Rwanda’s power sector, including Hydro, Methane Gas and other renewable and in ICT. And he was particularly keen to highlight the opportunities in Agriculture, specifically Tea and Tea processing where the value addition is now being done inside Rwanda.

President Kagame will lead a business delegation to the Africa Investment Forum in Tanzania on April 17 -19, where many of the Projects he highlighted will be presented. I would encourage all of those with an interest to come along to the Forum as it will be a very important business event for East Africa and the Continent as a whole.

Public Sector Reform in the UK

2011-03-10T09:42:00.001Z

In the UK currently much of the political discourse is centred on reducing Britain's Deficit and the Government's cuts in spending and the resulting impact on public services. However there is a second quite interesting stream to the government's plans that is receiving less media attention, the reform and the enhance role of the private sector in public services.

The UK has led in the past on enhancing the role business plays in the public sector, throughout the 80s it was the privatisation of unities, something that many other countries have emulated since. In the 90s and early 2000s it was the UK that led the way on Public Private Partnerships with PFIs, this initiative is also used increasing abroad and the UK is one of the world's largest providers of experts in this field.

The UK has a history of innovative public sector reform and this next round proposed by the Prime Minister David Cameron has the opportunity to be in the same vein. Plans to open government contracts up to SMEs rather than just large Corporates, for example, is sensible, it allows the country's largest employing sector access to the country's largest buyer. And widening the role the Private Sector can play in the provision of services will increase competition and hopefully improve quality at a time when government is decreasing spending.

If well implemented, this round of reform could well be emulated across the globe like the past.

Power in the Commonwealth

2011-02-21T13:26:00.000Z

Many Commonwealth County's development aims are being held back by
inadequate power supply and infrastructure. We have prioritised
infrastructure development in developing Commonwealth countries as a key
driver of economic growth and living standards, as a part of this we
will hold our first Ministerial Power Summit next week in London.

The summit is designed to bring together key stake holders in the power
sector to discuss in detail the issues facing the industry, and share
best practice and solutions from around the Commonwealth. The Summit
will be addressed by Power Ministers from 12 countries including 2 of
the Commonwealths largest markets, India and Nigeria. The Ministers will
present, to the audience of power experts and financiers, on the
opportunities and challenges in there respective countries. Many are
traveling with delegations including senior officials and
representatives of their regulatory bodies.

Over the next 15 years global energy demand is expected to grow by 49%
with at least 70% of this will come from developing countries, led by
China and India. Government alone will be unable to deliver the
generation capacity required to meet this increase in demand.
Partnership between the private sector and Government are going to be
essential and the sharing of best practice between countries that have
already developed successful models will be required. We hope that next
weeks power summit will be able to help with this.

Commonwealth Business Forum Launch

2011-02-09T15:19:00.000Z

On 31st January we launched of the Commonwealth Business Forum in Perth with the Premier of Western Australia, Hon Colin Barnett, and Special Minister of State, the Hon Gary Gray who represented the Prime Minister at the Event.

The Strength of the attendance at the Launch has further convinced me that this will be one of the best events CBC has ever held; the business community in Perth have a real enthusiasm for the Business Forum and are excited at the prospect of hosting their peers from across the Commonwealth.

The Forum will bring together business and government in unprecedented numbers, in my other travels I have already received positive feedback from India at both State and Federal Level and the President of Tanzania has agreed to bring a delegation to the Forum. We are planning for 15 Heads of Government, over 40 Minister, 100 Business Speakers and 1200 Delegates. It will be a great event and I hope you will be able to join – you can find our more at the newly launched event website www.cbf2011.com

Tanzania and AIF

2011-01-26T16:27:00.000Z

I was in Tanzania last week to meet with President Kikwete to discuss preparations to hold the Africa Investment Forum in Dar es Salaam. This year AIF will be a part of the East African Community Summit and will be addressed by all 5 EAC heads of Government.

Tanzania holds a particularly affection for me, it was host at the request of then President Mkapa, to CBC’s first Investors Roundtable back in 1999. This clearly demonstrated CBC’s early commitment to taking investment to countries that had never received it before, as it was also the first international investor conference ever held in Tanzania.

The AIF, always a popular event, this year comes at a time when Africa’s star is rising and the world is taking more notice than ever before. The IMF’s most recent forecasts have predicted that 7 of the 10 fastest growing economies in the world over the next 10 years will be in Africa. The potential of a Continent with 1 billion possible consumers, that has added more people to the middle classes over the last decade than any other area of the world is not to be underestimated.

Planning for 2011

2011-01-07T10:26:00.000Z

This year is going to be one of CBC's busiest. As a CHOGM year 2011 will have a strong focus on Perth and the build up to the Commonwealth Business Forum in October. However before we fly to Australia we will hold events across the Commonwealth. Starting next week in Gujarat, India where we will hold a SME roundtable as part of the Vibrant Gujarat event. Our Africa focus will be maintained by the Africa Investment Forum to be held in Tanzania and the G8 Africa Business Forum to be held in London. We will return to the Americas for the Caribbean Investment Forum in Trinidad & Tobago. This is alongside plans to host a number of Commonwealth Heads of Governments and Senior Ministers at Members functions throughout the coming year.

While Perth will be our main focus over the coming year as we develop the business forum programme with our corporate members and other stake holders, we will focus on 4 main themes throughout 2011.

1) Broaden the range of Commonwealth countries that CBC interacts with and play a role in promoting Trade and Investment in their economies.

2) Play a greater role in helping strengthen connections between Commonwealth countries and the wider global economy.

3) Continue CBC's focus on infrastructure development as a key support for growth and development

4) Finally CBC will develop a stronger focus on helping SMEs to internationalise into the global economy

2010 and the Commonwealh

2010-12-27T13:25:00.001Z

2010 has been a difficult year for the world economy with growth stifled in the developed world and deficits to be tackled. The Emerging world on the other hand has demonstrated the intrinsic strength and is proving that the engine of the Global economy has categorically shifted to the East.

Over the last year, millions have joined the middle class in Africa, Asia and the Caribbean and are entering the global economy as consumers, this will continue. In Africa alone, 200m people will enter the market for consumer goods over the next five years. 2010 has been a year of surprisingly good global growth of around 4%, with emerging markers displaying rates of between 6-7% and the developed world 2-3%. This will be the pattern for years to come as the emerging nations drive the global economy forward.

Much has been written about Asia's role in the world (especially given China's emergence as the second largest economy in the world earlier this year) but the story that gets less recognition is Africa's growth story, 5% this year and predicted to be around 5.5% next year. In 2010 Ngozi Okonjo-Iweala, Managing Director of The World Bank said that Africa could be the next BRIC, and become a major recipient of investment rather than aid. At the same time McKinsey told companies, that 'global businesses cannot afford to ignore the potential' of Africa.

Africa's growth is creating massive new business opportunities, it is predicted that Africa's 4 leading industries, retail services, agriculture, resources, and infrastructure could generate as much as $2.6 trillion in revenue annually by 2020. And Africa is gaining greater access to foreign investment, total FDI into Africa rose from $9 billion in 2000 to $62 billion in 2008, and today the rate of return on foreign investment in Africa is higher than in any other developing region.

In 2011 CBC will continue its engagement with all the Commonwealth nations, we will hold investment and business promotion events in Africa, the Caribbean, Asia and the UK. And in October 2011 we will host the 8th Commonwealth Business Forum in Australia. CBF 2011 will be a major event for Large and small companies with about 1000 business leaders attending.It will also help us to reach pacific small states that we have had difficulty engaging with before. 2011 should be an exciting year!

MSMEs and the Commonwealth

2010-12-15T09:56:00.000Z

Small companies are the life blood of all Commonwealth economies. In the UK, for example, MSMEs account for 99% of all businesses. As much as 50% of the UK’s workforce is employed by companies employing less than 100 people and on average 65% of all new jobs are created by MSMEs each year.

As the UK looks to export its way out of recession greater emphasis is being placed on helping to internationalise MSMEs, as only the most innovative and competitive MSMEs will succeed in international markets. A strategy that focuses on supporting fast growing and innovative MSMEs internationalise will reap disproportionately large returns for all countries involved. India in particular is seen as an enormous potential market for MSMEs, but so far UK companies have struggled to penetrate the market.

India has continually demonstrated an ability to nurture its own MSMEs into national and international corporations, almost all the major Indian companies have developed from humble origins within living memory. India is therefore an important market for international MSMEs looking to win new business and for those countries looking to learn how they can support and develop their own MSMEs.

Doing business with another Commonwealth country can be up to 20% less expensive than doing business with non-Commonwealth countries as a result of the ‘Commonwealth Factor’. These factors are of disproportionate advantage to MSMEs, so the Commonwealth relationships can play a key role in developing international MSMEs that will help drive growth and job creation across the 54 member countries of the association.

Good governance and increased prosperity

2010-11-25T17:36:00.001Z

On recent trips to Asia both the British Prime Minister, David Cameron and the US President, Barack Obama have made the point of highlighting one of things that can make the Commonwealth stand out in the future – the importance of the link between good governance and increased prosperity.

Addressing the tricky topic at his lecture in a Chinese’s university, David Cameron said ‘I am convinced that the best guarantor of prosperity and stability is for economic and political progress to go in step together.’. This approach is key to the Commonwealth future success, I have always argued that the Commonwealth should give an equal focus to both the Harare Principles, on good governance and human rights and to the Edinborough Economic Declaration. This is proven by many Commonwealth members, who are required to abide by certain rules regarding governance, human rights and the rule of law, or face expulsion from the association. It is no coincidence that the same countries are nearly always investment destinations of choice.

Making this point very clearly, President Obama in his address to the Joint Session of the Indian Parliament during his recent trip said "As India marks 60 years with a strong and democratic constitution, the lesson is clear: India has succeeded, not in spite of democracy; India has succeeded because of democracy,"

Britain, India and other Commonwealth countries can help in the development of other countries by explaining how their focus on good governance has led to increased investment and increased prosperity. Commonwealth successes, are based on a respect for the rule of law, human rights, etc as it is these things that give investors the confidence to invest in the association’s member states rather than other countries.

China

2010-11-10T16:32:00.000Z

I was delighted to be in China last week for the first time in 10 years, even in that short part of the country’s history the change is remarkable. The level and quality of the infrastructure that has been built over that period is incredibly impressive, and beyond world class - the west would envy much of it. I also had the chance to visit the Olympic village, and see the birds nest stadium - another remarkable achievement!

I was there to sign an agreement with a large Chinese infrastructure conglomerate AVIC. The agreement is to help introduce Chinese investment into Commonwealth countries, predominantly in Africa. We hope to use the agreement to highlight investment opportunities in the less recognised and developed parts of Africa to enhance their development agenda.

The second side of the agreement focused on developing better partnerships between, British and Chinese companies, and I am grateful for the presence of the British Ambassador to China, Sebastian Wood, in recognising this.

China like India will drive the global economy for the next 50 years, a fact that is increasing recognised by western leaders. David Cameron is currently leading the largest trade mission (4 cabinet Ministers and over 40 business leaders) Britain has ever taken to country, in order to pursue the aim of doubling trade between the 2 countries. Missions like these will increasingly become a feature Heads of Government’s trips to China.

Power reform in Nigeria

2010-11-02T09:37:00.002Z

Last month at the request of HE Goodluck Jonathon we organised in collaboration with the Presidential Task Force on Power, Chair by Professor Bart Narji, a Presidential Retreat for power Sector Investors. The President called the retreat to discuss with the international private sector his Roadmap to privatising Nigeria’s power sector. CBC brought 70 high level International power sector investors to the event from over 30 countries, both inside and outside the Commonwealth. In total 400 people attended the event, to hear addresses from the President, Vice President and Senior Ministers.

The Economist, who were in attendance, wrote an interesting article about the retreat that can be read here

The following week, we here honoured to host a lunch for the Vice President, Mohammed Namadi Sambo, during his visit to London. The Vice President addressed a packed room of CBC Members, High Commissioners and business leaders with an interest in Nigeria on the power privatisation plans, during which he described CBC as a ‘true friend of Nigeria’.

CBC has been fully engaged with Nigeria since its return to democracy, in fact we were the first organisation to organise an investor conference in the country. Over the last few years, however, our relationship has shifted in priorities, moving away from more generalised trade and investment promotion – that Nigeria is needing less and less as the world wakes up to the opportunities available in the country - to more niche work, such as the power retreat. This change, I think recognises Nigeria’s move towards middle income status and as one of the drivers of Africa’s economy over the coming years.

The future of the Commonwealth

2010-10-29T11:47:00.000+01:00

Over the last couple of weeks I have had discussions with both the Chair in Office of the Commonwealth, the Rt Hon Kamla Persad-Bissessar, Prime Minister, Trinidad and Tobago, and the Commonwealth Eminent Persons Group on the future direction the Commonwealth should take.

The EPG was set up by the Heads of Government in Trinidad and Tobago at CHOGM last November to discuss the future of the Commonwealth and sharpen the impact, strengthen the networks, and raise the profile of the Commonwealth. I believe that both the roles of the Chair in Office and the Secretary General should be expanded to enhance coordination between the Commonwealth’s Key Agencies.

Also I feel the Commonwealth should take greater advantage of the excellent work it’s done on good governance and human rights since its founding, and now think about how to convert those successes into economic prosperity. By giving equal attention to the Harare Principles on good governance and the Edinburgh Economic Declaration, the Commonwealth can do more to highlight the link between good governance and increased investment. We feel that this link can be further strengthened by the creation of a commonwealth development fund that would invest in countries that show the best progress in good governance.

This new approach could make the Commonwealth truly relevant for tomorrow, as it will allow the association to directly focus on the areas of greatest importance to all heads of Government (developed or developing); jobs and growth, while still maintain the Commonwealth’s historic focus on good governance and human rights.

Nigeria and Elections

2010-10-07T11:13:00.003+01:00

Last week I was in Nigeria for our yearly Nigerian Investment Forum, the event was a great success bringing investors from across the commonwealth to meet project holders in Nigeria. For the first time the event also included a business awards gala dinner to celebrate excellence in Nigeria’s private sector, the awards were hosted at State House.

While we were in Nigeria, HE Goodluck Jonathon announced his intention to run in next years presidential election. He has promised electoral reform to ensure a free and fair vote. The Nigerian Business community along with the county’s citizens all want to see elections that will allow the country move forward with its development goals. Any uncertainty over issues of governance can have a direct and measurable effect on a country’s ability to attract foreign investment, so I add my urging that the county comes together at this election and delivers a result that the rest of the world can respect.

President Kagame's inauguration

2010-09-13T14:06:00.000+01:00

I was honoured to be invited by President Kagame for his inauguration last week. It was an amazing event that filled the Stadium to its capacity of 40,000 with 10s of thousands more watching on screens outside. The Event was attended by 14 Heads of State from across Africa, Ministers, Private Sector Leaders and representatives of International NGOs and Agencies.

The Event was not just the inauguration of Rwanda’s President but the inauguration of a new African Statesman, demonstrated by the level of support shown by visiting Heads of State.

President Kagame dedicated much of his speech to responding to his Critics on Human Rights and discussing the development successes in Rwanda. Anyone that has seen the changes in Rwanda over the last 10-15 years cannot fail to be impressed with the level of progress and development.

While NGOs and the International Media have a right to discuss Rwanda’s Human Rights, I hope they do it within the framework of the Development successes. Leaders like Kagame have to be engaged in Dialogue with constructive criticism rather than publicly hung.

Africa is changing, progress is being made on democracy and economic development and the continent should be engaged in recognition of its potential to be the next BRIC. Africa will be one of the key drivers of global growth over the next century. Let’s not miss this opportunity by failing to create mutually beneficial dialogue and consolidate our partnerships with the continent.

Rwanda and one size fits all development

2010-08-25T11:19:00.001+01:00

I was pleased to see President Kagame respond to his critics in the international media via a strong article in the FT last week. It is important that we pay vigilant attention to Human Rights issues across the globe, but President Kagame makes an important point that there is no ‘one size fits all’ path to development and democracy.

Given Rwanda’s recent history, we should praise the country’s success on the path to competitive democracy and continue working with the country to help them strengthen it.

President Kagame also argued that Africa must take responsibility for its own future, that Africa must devise its own solutions to its problems and that partners that work with Africa in this way will benefit. Africa Forging its own path is important for the future of the continent and President Kagame is an important advocate of this.

Africa the next BRIC

2010-08-11T13:28:00.000+01:00

Sub Saharan Africa can be the next BRIC; from 2000 to 2010 Sub Sahara grew at a faster rate, in nominal dollars terms, than both India and China and is predicted by the IMF to grow at a faster rate than Brazil between 2010 – 2015.

Sub Sahara has much going for it and conditions are improving constantly. Between 2002 and 2008 the continent achieved a growth rate of 5.2% a year on average, and only dropped a single percentage point since the global economic crisis – still a higher rate than the developed world is expected to achieve.

Africa’s population had grown to 820 million in 2008, and the percentage that can be considered ‘middle class’ has grown astronomically since the 1990s. Africa is now both ready to take its place as a market of consumers for global products and as an attractive investment destination for global business looking for new opportunities. I would suggest Commonwealth countries to potential investors as they make up 17 of the top 20 places to do business in Africa, according to the IFC.

To achieve this jump, to become the 5th BRIC, Africa needs to deal with a number of persistent issues such as the infrastructure and power deficit, increasing access and the quality of Education and enhancing business competitiveness, these will have to be achieved along with progress on democratization and good governance. To succeed on both economic development and good governance simultaneously African will need more strong and dynamic leaders. Rwanda and President Kagame are a case in point; it is unfortunate to see the international media running negative stories about one of Africa’s best success stories.

Paul Kagame has been one of the most ambitious and successful African leaders in fighting poverty and driving growth in his country. This year the IFC named Rwanda the best business reformer in the World, likewise Paul Kagame is recognised by many western leaders as one of Africa’s Best, Tony Blair described him as ‘visionary’ a sentiment I agree with.

While there are concerns about the current election in the Rwanda, we must not forget the impact that Kagame has made on the development of his country. Democracy is hugely important but it will not be achieved without economic development, democracy on empty stomachs will not succeed –this needs to be more widely recognised.

While raising the issue of Human rights, we should be supporting leaders like Paul Kagame that are driving progress in their countries and the continent. Africa is also making progress on democratisation, Kenya’s recent peaceful referendum that aimed the settle the country’s political disputed is a good example. These stories and there like should be the ones that the international media focus on as Africa strives to become a BRIC. A more balanced approached to reporting on the continent, that helps encourage Africans, will benefit us all in the end.

David Cameron in India

2010-08-06T10:03:00.002+01:00

David Cameron's visit to India last week could well turn out to be one of the most important diplomatic trips of his time in number 10.

The commitment by both Governments to transform the nation’s relationship over the coming years is most welcome. Both leaders agreed that the India-UK relationship has great room for growth, in the political, cultural, security and economic realms that would be of benefit to both countries.

I am particularly pleased to see the commitment to significantly increase trade and investment between the 2 countries. I have long been calling for the level of interaction between the countries private sectors to be raised and am delighted that the UK-India CEO’s Forum is being set up under the Peter Sands of Standard Chartered and Rattan Tata of Tata Group (both CBC members of long standing) to provide the private sector perspective on strengthening the economic relationship. I look forward to working with the Forum in the future.

Hon Kamal Nath, India’s Minister for Road Transport speaking earlier this year at our India Infrastructure Forum (IIF) said the next 10 years will be India’s Infrastructure Decade. The opportunities offered by this are enormous, tackling India’s infrastructure deficit will require cooperation between the Indian government and the national and international private sector, and the UKs business should be leaders in this. To help push this Lord Adonis, the then UK Secretary of State for Transport, initiated a MoU between the Indian Government and the UK at the IIF to work together on road development, a process that was continued during the Prime Minister’s visit last week.

It is great to see the New British Prime Minister taking such an interest in strengthening the Bi-lateral relationship between the 2 countries, in a report we produced in 2008, and are currently in the process of updating, we found that the UK was India’s most significant investor, a trend we hope continues.

And finally I was delighted to see the strong commitment made by both Prime Ministers during their meeting to work together to ‘strengthen the Commonwealth’ as an important global body.

Singapore a world leader

2010-07-29T19:31:00.000+01:00

Further evidence of the global economies shift to the East has emerged. Singapore, one of the Commonwealths most developed nations, has released record breaking growth rates, for the second quarter of this year the country grew at 19.3%, the fastest rate of growth since records began in 1975. Singapore's remarkable record in the IFC’s Doing Business Index is not merely coincidental to its exceptional level of growth. The city state is the most business friendly county in the world, this is an example that both developing and developed countries will need to follow if they want achieve any level of growth let alone 19.3%.

Following Singapore's example of how a small state can grow to become a world player is an aspiration I have seen a lot in the commonwealth's developing nations aim to become regional players. Singapore is a financial hub for Asia and can act as a gateway for other Commonwealth countries to access its non-Commonwealth neighbours in the region, this is an example countries would like to replicate.

When Singapore is displaying growth rates of this level and many of its regional neighbours are growing at rates of 10% or more, it is no wonder that Asia is of ever increasing importance to the global economy.

CBC - ICICI Dinner

2010-07-22T13:55:00.001+01:00

Last week I had the pleasure of Hosting Ms Chanda D Kochhar, Managing Director & CEO of ICICI Bank for a dinner with leading Indian and British business leaders in London. She made a series of extremely interesting points during her speech.

Firstly it was noted that now was the time for India to take centre stage, that its annual growth rates exceeding 8% put the country at the forefront in the Global economy and that Indians themselves believe it is there time. Ms Kochhar also argued that for the current growth rate to be sustainable over the coming years the Indian banking sector would have to grow by about 20% a year, this would mean the banking sector increasing in size by 2.5 times over the next 5 years.

Ms Kochar also drew an interesting parallel between the western economies and India. She suggested that the while stimulus packages had been needed in the west to preserve growth and stave off recession, in India all the investment is demand led. "as bridges and roads are completed they are filled with traffic" she said. 'The need for infrastructure for a development is currently a real opportunity, but left un-tackled will become a serious bottle neck to Indian growth', she added.

Ms Kochar made one final 'mind boggling' observation, that by 2020 India would be home to 25% of the world's work force. India will continue to benefit from the demographic dividend until 2040, which will be the first point at which the median age of the population exceeds 32, a benefit China does not share. With such a large part of the population in the working age group, India can expect to enjoy a long period of increasing domestic consumption and prosperity.

The strengths of the Indian economy Ms Kochar highlighted, clearly demonstrate just how important India is becoming to the global economy. And indicate the level of opportunity available to the international investor looking to invest.

India, Africa and employment

2010-07-16T12:01:00.001+01:00

An interesting report by the Oxford poverty and human development inactive was recently released that found that there were ‘more poor’ in India than Africa. This doesn’t surprise me as much as it seems to have others, while India has made improvements it has never rated highly on the UN’s Human Development Index, India ranked 134th out of 182 countries in 2009.

What occurs to me, is the similarities between the areas of high poverty in India and Africa. Outside of the urban poor, the areas with high levels of poverty are predominantly regions with large deposits of natural resources and areas of with high levels of agricultural fertility, that still operate some form of feudal system.

The reasons for poverty are the same the world over and many of the solutions can be applied globally. Investing in agriculture will allow farmers to move away from subsistence to commercial viability. Resource companies are not ‘good’ job creators, so they must be pushed to downstream and help create the support industries that will provide employment in resource rich regions.

Poverty will only be tackled successfully where government works in partnership with the private sector. Government must provide a regulatory and tax environment that stimulates economic activity. While the private sector must take advantage of this and provide employment along the length of the value chain.

UK aid commitments

2010-07-12T17:55:00.000+01:00

I support the UK’s International Development Secretary, Andrew Mitchell’s decision to relook at the at the UK’s aid commitments to the BRIC countries (Brazil, Russia, India and China). This money can now be shifted more towards countries with a greater need, and less ability to help themselves.

Also, I again urge the Minster to examine the way in which aid is spent, there must be a shift over the next few years to aid that supports growth and aims to increase the involvement of the private sector, allowing national governments to pay for their own social infrastructure. While the shift cannot be uniform, many of the poorest countries will still need support in social areas; there are other middle income countries that can begin the shift towards growth centred aid, so that they may hopefully follow in the BRIC’s footsteps.

Vince Cable's Industrial Policy

2010-07-09T13:16:00.000+01:00

I am pleased to note that Vince Cable the UK’s new Business secretary is adopting a more market orientated industrial policy than we have been used to in recent years. Mr Cable has describe an industrial policy that funds public goods such as, research, education and infrastructure but does so in a way that is market led rather than state led.

While recognising that the state has an important role in supporting areas and sectors where the UK has a competitive advantage, Mr Cable is rolling back the support offered to individual firms and factories. Instead the department for Business favours investing in the support for increasing the UK’s human and intellectual capital. In the long term backing training and research in the UK is the only sustainable way of increasing employment and growth in the UK.

Vince Cables Business Department is also continuing the push to force the nationalised banks to increase their levels of lending, this is very welcome. The current lack of available credit in the UK economy is stifling the Critical SME sector that will be vital for bringing down levels of unemployment.

Vince Cables new approach to Industrial policy in the UK is very welcome as it positions the private sector at the heart of the British economy while not forgetting the important areas in which the state needs to support the wider economy.

Make Poverty History through Trade and Investment

2010-07-02T18:02:00.001+01:00

Make Poverty History is an idea that has been picked up by nearly every agency working in developing countries whether they are charities, NGO’s or development agencies. However the slogan has become so closely related to charity and foreign aid, that I fear the wider picture has been forgotten. Make Poverty History is even more relevant for the Growth agenda, for CBC we are trying to make poverty history though trade and investment. I am glad to support the work of the multi party parliamentary group, Trade out of Poverty, who are dedicated to this agenda and aim to help the world’s poorest countries trade their way to a better life.

It is my feeling that we too often forget that the only sustainable way to eliminate poverty is to ensure that the local government is responsible for its achievement. This does not mean that we don’t have a responsibility to eliminate poverty, quite the opposite; I feel it is all of our responsibilities to support the governments in their mission to eliminate poverty.

Growth is the only tool that can eliminate poverty, aid alone will never achieve this, and developing countries must develop their economic infrastructure, which will in turn increase their tax revenues allowing greater investment in the engines of growth. It is the responsibility those outside the country to support the government’s efforts in this regard, whether it be refocusing aid to help in the strengthening of business environment or facilitating private sector investment in big infrastructure projects.

G20

2010-06-29T16:48:00.000+01:00

One of the inevitable results of the Global Financial crisis was the widening of international economic discourses beyond the G8. I welcome the official recognition of G20 in this new role, as the first line of the Communiqué put it, Canada was the first meeting of the G20 in its ‘new capacity as the premier forum for our international economic cooperation’. The G20 is a bigger and more inclusive forum than its predecessor the G8, containing wider views and more of the countries who were least affected by the financial crisis. The G20 should be better placed than the ‘western’ orientated G8 to prevent future banking crises.

I also welcome and fully support Prime Minster David Cameron’s remarks during the summit on the importance of the Doha round of trade talks. He commented that all countries will befit from an increase in trade flows and that his government would be pushing for the rounds conclusion. He added that the concluded round could contribute over $170 billion to the world economy, this I think would be very welcome at a time when global growth is still sluggish.

Finally i was pleased that a B20 meeting was held alongside the G20 meeting for the first time. This gathering of business leaders was designed to allow the views of the private sector to be fed into the G20’s deliberations. The private sector is essential to ensuring a sustainable global recovery. I am pleased that John Denton, a CBC Board Member, was representing Australian business at the event and look forward to working closely with the B20 in the future.

Africa and Aid

2010-06-25T18:06:00.003+01:00

At the beginning of the week I had the pleasure of opening our G8 Africa Business Forum in London. The Forum is an annual event that feeds African private sectors views into the G8’s deliberations. Considering the recent economic turmoil we thought it best to focus on the good, and highlight the myriad opportunities offered by Africa, hence the theme Success stories and new partnerships.

The Forum was addressed by the Prime Ministers of Togo and Cameroon and Ministers from Angola, Namibia and Zambia. We were also delighted to have 2 members of the UK’s new coalition government address the Forum.

One of the Key messages coming out of the forum, and one I think is particularly important, from both government and business is the need for Africa to accelerate its move away from dependence on foreign aid to wealth created by its own citizens.

Future foreign aid must be directed to concentrate on reforms to deliver sustainable results and improve value for money. Aid should be targeted to improve the basic economic infrastructure, to improve competitiveness and produce higher rates of growth. As a result African government’s tax revenues will increase, which will in turn allow them to focus on their own social infrastructure. This will shift the responsibility for their delivery of public services like health and education to African Governments.

Entrepreneurship and the private sector are the only sustainable drivers of growth in Africa, and targeting Aid to enhance them should accelerate the continents ability to create its own wealth and increase its prosperity. I have personally been advocating this message to Aid Agencies and Governments and have written to the Chair of the G8, the Canadian Prime Minister to reiterate it.

UK Budget

2010-06-23T13:12:00.001+01:00

I would like to join with the CBI and the British Chamber of Commerce, who have broadly supported the Chancellors budget plans. Both are pleased by the Chancellors plans to cut the deficit and restore investor confidence. I feel it is important that the private sector is at the heart of the British economy.

Maintaining Britain’s privileged position as an investment destination of choice is something I have commented on before in this blog. Changes to corporation tax should help with this. Reduction of the small businesses rate to 20% and a 4 year plan to reduce the headline rate to 24% are also welcome and should help maintain Britain’s competitiveness.

The significant increase in entrepreneur’s relief and maintaining thresholds should be effective in insulating small business and investors from the increase in Capital gains tax. The proposed new 28% rate of tax should allow the UK to remain internationally competitive.

The budget appears to be well positioned to promote British business and maintain the levels of investment. The Government's plans to consult with business on issues relating to the R&D tax credit are also welcome.

BP and Oil

2010-06-18T09:29:00.001+01:00

The BP Oil disaster has been badly mishandled by all concerned. President Obama's personal attacks on Tony Hayward were not warranted. I have had interactions with Tony and heard him recently at our Business Forum in Port of Spain. He takes corporate social responsibility very seriously. However most people think that BP's initial reaction was not well thought out, Tony Haywood's gaffes about wanting his life back were not appreciated in the US. This has led to greater than was necessary pressure on the Oil Company. It is a good sign that BP has now agreed to suspend its dividend payments this year, and will instead pay into a compensation fund for those affected. This news has been met with a rise, the first since the crisis began, in BP's oil price. BP needs to reflect on whether its existing CSR policy is sufficient, or whether it was badly implemented in this situation.

BP's interaction with the US Government have not been well handled, neither the Company nor the President are currently considered to have handled the situation well. The company's initial reaction angered the American public and resulted in strong statements from the White House. The Presidents desire to 'kick some arse' was not good for the Company's share price. Tony Haywood faces congress this week in an exchange that is not going to be good for the Company's image. The Line taken by the US government in this crisis appears to disregard that BP is jointly listed in the US and London with nearly 30% of its shareholders based in America.

The Company's apparent lack of preparation for this disaster has left the BP open to criticism. All energy companies, including BP, need to invest more time and money in R&D to help prevent accidents of these types and have better plans in place to deal with the consequences of inevitable failures. On a similar note a renewed focus on developing alternative energy solutions would make drilling for oil in these difficult and dangerous locations unnecessary altogether.

2010-06-08T10:26:00.000+01:00

The new coalition government has a difficult tight rope to walk over the coming months, on one hand the deficit in public spending must be reduced – spending cuts and higher taxes will probably both be necessary. On the other hand the Government needs to be careful not to jeopardise the UK’s position as a global investment hub. The Budget on the 22nd of June must be carefully balanced to protect this, while delivering a tax system that is fairer to the less well off.

My suggestions for the government are:

The UK is more often than not either the largest or second largest source of investment in Commonwealth Countries. In return the UK is often the destination of choice for other Commonwealth countries outbound investment flows. This privileged position needs to be protected.

Government expenditure needs to reduced, there are many tasks currently undertaken by the public sector that the Private can deliver, particularly in international aid.

While I was pleased to hear in the Prime Minsters speech this morning that international aid is to be ring fenced, there is a need to refocus what it is spent on. Aid should be spent on improving the receiving countries ability to attract increased private sector investment that will promote job and wealth creation, creating a sustainable economy.

Finally the UK must preserve its Global Comparative advantage; it should implement a mechanism that attracts highly skilled and professional migrants to the UK.

Africa Day

2010-06-02T09:38:00.000+01:00

Last week we celebrated Africa day with a dinner for High Commissioners and Ambassadors from African Countries. The Dinner was hosted by Essar Group and addressed by Antonio Gumende, High Commissioner for Mozambique and acting Dean of the African Union Heads of Mission. Discussions focused on increasing investment in Africa with a particular focus on Infrastructure and power generation. I would like to thank Essar Group’s Vice-Chair Ravi Ruia for flying in especially for the dinner.

The dinner marks a continued increase in interest and confidence in Africa from business around the world; capital flows rose by 16% up to a record $62 billion in 2008, while foreign direct investment fell 20% worldwide in the same year. Many countries are increasing their presence in Africa Singapore, Malaysia, Canada and the UK, to name but a few. Australia’s presence is also increasing, around 40 per cent of Australian mining companies' overseas projects are in Africa and Australia’s trade with the continent has grown about 9% a year for the last 10 years.

This renewed confidence was supported by a report in the FT this morning, that stated 500 of Africa’s companies have been displaying growth of about 8% a year since 1998; this is supported by a surge in export growth that is either exceeding or matching that of the BRIC countries. The last few decades of the 20th century were all about the Asian tigers driving Asia’s growth, the next 20 years could well be about the African Lions that will drive Africa’s.

Rwanda Investment Forum

2010-05-26T10:57:00.001+01:00

Last week CBC hosted the first international investment forum in Rwanda since the country joined the Commonwealth in November 2010. It was a pleasure to be back in Kigali with HE Paul Kagame and his team of Ministers who led the discussions at the Forum.

Rwanda has been a favourite destination of mine and CBC for the last 3 years and I am delighted that the Forum was a huge success. Over 300 delegates attended, nearly half of whom were made up from international investors, many visiting Rwanda for the first time. 10 Companies expressed an interest in setting up in Rwanda, including a large Indian ICT company, which will set up its Africa office in Kigali and also several proposals in Agriculture and Agri-processing.

I would like to express my personal gratitude to the British High Commissioner in Rwanda for hosting a reception for the international delegation, and to his wife for graciously preparing sushi for the guests. Another highlight of the Trip was a Commonwealth Vs Rwanda cricket match that very diplomatically resulted in a draw. Rwanda, with only 3 months membership under its belt is already acting as if it has been a member for years!

I am sure contributions and leadership of HE Paul Kagame will be very noticeable at all future commonwealth deliberations.

The Commonwealth Factor and Africa

2010-04-30T07:22:00.001+01:00

As I have said before in this blog, the Commonwealth's greatest strength is not its institutions but its networks, values and the, 'Commonwealth Factor' - the similar administrative, legal, financial and business practices that members share.

The impact of the Commonwealth Factor is best demonstrated in Sub-Saharan Africa. According to the International Financial Corporation’s (IFC) Doing Business Report 2010, 17 of the top 20 places to do business in Sub Saharan Africa are Commonwealth countries: Mauritius, South Africa, Botswana, Namibia, Rwanda, Zambia, Ghana, Kenya, Seychelles, Uganda, Swaziland, Nigeria, Lesotho, Tanzania, Malawi, Mozambique and The Gambia. A high ranking on the ease of doing business index means the regulatory and business environment is conducive to the operation of business and goes a long way to explain why Commonwealth countries outperform competitors.

Africa’s Commonwealth countries have shown good progress, reforming to become better business destinations over the last few years, with Mauritius, Mozambique, Sierra Leone, and Zambia all moving up the rankings in 2010. Rwanda’s case is extraordinary, rising from 158th in 2006 to 67th in 2010.

The UK Election and the Economy

2010-04-26T08:28:00.001+01:00

A recent article in the economist made some concerning comparisons between the UK's recovery from the recent financial crisis and Japans recovery from the Asian banking crisis in the 1990s. The report compared the 2 countries of level of indebtedness and found them similar; it also stated that Japan has never really recovered from its economic momentum since the crisis.

I agree with the Economist that this is an unlikely outcome for the UK; I have a lot of faith in the UK's businesses and entrepreneurs to find a way to stay profitable and keep growing. However this growth can only be assured if business and the wider economy are supported by the government. With elections fast approaching and the outcome more uncertain than in recent years there are signs of fear in the stock market and public anxiety around a hung parliament.

This is the worst time for British politicians to try to learn the art of government by coalition and compromise when the economy is still in need of strong leadership and decisive action. Whatever the form of the next British government takes it must be able to act rapidly and with conviction.

The polls are suggesting the Liberal Democrats are doing better than ever before, this must surely increase the chances of a Hung Parliament. I hope that any coalition Government can quickly form a consensus on the direction of Britain's economic recovery, and the parties' inability to agree does not prevent a return to sustained growth. I was surprised that Nick clegg still feels that Uk should join Euro. It would have been a disaster for Uk if it had joined Euro. UK is much better outside Euro so that it can control its monetary policy as Uk's Economy is very much linked to global economy. Singapore ,a much smaller country and economy, is in the same position and is able to see high growth as it controls its own currency.

What ever the outcome of the elections i hope politicians of all parties will be more honest with the public about the state of economy and the need for structural reforms to return to economic growth and to balance the economy between various sectors and particularly to increase the role of manufacturing. Hard decisions will need to taken sooner than latter particularly in balancing the reduced role of government and recovery of the economy.

Customer value and share value

2010-04-20T22:50:00.001+01:00

After reading an interview with Paul Polman, the CEO of Unilever, in the FT I want to congratulate him for reopening an important debate, and I hope that other CEO's will follow his lead and start talking about who the most important stakeholder in a company should be. Paul's argument was that making share value the key objective of a business is great for in the short term but is not so good for the long term planning or prospects of a company. By focusing on the customer and consumer and ensuring the company acts as a good corporate citizen long term profits are ensured.

CBC's corporate social responsibility makes a similar point, while share holder value is important there are other considerations. Customers must be considered the most important stake holder, no company can continue without the continued support of its customers.

CBC's approach is based on the fact that Customers and Shareholders play the most important role in shaping the values and strategy of the Company.The other stakeholders being the employees and suppliers.

Good corporate citizenship based on customer satisfaction includes many benefits such as brand reputation, ability to enter new markets and defend existing ones and retain good employees. As Polman has demonstrated with Unilever companies that prioritise customers and act as responsible members of the communities they operate in "share value" success will follow.

India's second tier cities

2010-04-07T16:05:00.002+01:00

I was in India earlier this month, as well as visiting the major business cities I spent time in some of the ‘second tier cities‘, Ahmadabad, Chennai and Kochi. What I noticed most of all was how well the infrastructure in these cities is developing to handle the increase in business there.

In Ahmadabad in particular, a city once renowned for its cost saving, the business district’s skyline is becoming more and more impressive. Business in these cities are following in the footsteps of the bigger cities and becoming more like their western counterparts, adopting western style business structures and marketing strategies. Where business were once housed in old building to avoid costs, they are becoming more and more willing to undertake the often extravagant costs of moving to high end, high tech office spaces with the view it will help get the next order and allow them to compete with rivals. This change in attitude should help make India’s second cities more competitive and drive forward their growth.

Prime Minister Manning and CBF

2010-03-19T16:12:00.005Z

It was a pleasure to catch up with Prime Minister Manning of Trinidad and Tobago last week while he was in London for Commonwealth Day. We discussed CHOGM and CBF and its impact on Trinidad and Tobago, the Prime Minster made it clear that he believes that the Business Forum is a vital part of the whole CHOGM experience. For any country that hosts CHOGM, he said, the key is maximizing the private sectors involvement.

Prime Minster Manning spoke of how by leverraging the Business Forum he was able to broaden the horizons of Trinidad and Tobago’s SME sector. By interacting with the global business leaders who attended the forum Trinidad’s small businessmen were able to develop new global linkages and partnerships. The Forum was also important in bringing new investment and investors to the Island by increasing the profile of the Country to an international audience.

The Prime Minster described how by interacting with the private sector and politicians who attended CHOGM he was able to get a better understanding of how other countries are managing to balance challenges such as climate change with the need to maintain high growth rates.

Prime Minister Manning was particularly proud of how successful the Forum was in promoting new linkages between the Commonwealth and the Americas, and suggested that Trinidad should be the host of a Global Business Forum early next year to keep up this momentum. I was delighted to hear this from the Prime Minister; we place a high value on his leadership and recognise the key role he played in making the Business Forum such a success.

Encouraging signs in Malaysia

2010-03-03T18:02:00.002Z

Last week I was in Kuala Lumpur, Malaysia to continue talks with Prime Minister, Najib Tun Razak, started at CBF in Trinidad. I had a very good meeting especially coming at a time when the economy is showing encouraging signs of growth estimated to be 5% for the coming year. The main theme of the discussion was on the Prime Ministers views on the return to global growth particularly through emerging markets like Malaysia. The Prime Minister told me that Malaysian Companies are becoming more and more active in other Asian Countries, particularly China, India and Indonesia.

The British High Commissioner to Malaysia, Boyd McCleary, confirmed the importance of the Malaysia to the developed world in the wake of the Financial Crisis, more and more British companies have a growing presence in Malaysia.

I met with a number of prominent Malaysian business leaders during the trip; they all expressed similar optimism and described growth plans for the coming year, from plantation projects in Indonesia, rural Malaysia and Nigeria to exporting the Malaysian experience in world class Infrastructure development to other markets, such as India. Malaysian companies are expecting real growth this year.

Africa Investment Forum

2010-02-23T17:55:00.000Z

The Africa Investment Forum, which we held in Ghana for the first time, was the largest Investment Forum of its type CBC, has ever held. Over 700 delegates gathered from more than 30 countries for the Forum. One of the most impressive features of this year’s Forum was the wide scale involvement of Investment Promotion Agencies from across the Africa; over 220 projects were up for discussion.
3 Heads of State, 15 Ministers and over 50 Business leaders took part in the sessions; there were a couple of key themes I noticed coming out though out the Forum.

1) Every session, whatever the title on the programme eventually made mention of greater regional integration and the importance of enhancing Intra-Africa trade.

2) Secondly, one of the key impediments to growth and development highlighted at the forum was the need to do more to reduce the infrastructure gap in Africa; this was also flavoured by the talk of Greater regional cooperation – reductions in infrastructure barriers can happen faster if countries work for a more unified response.

3) The Importance of Agriculture for the coming decade, increasing rural incomes is essential to driving sustainable growth and development. The ever growing Global demand for food products is a perfect opportunity for Africa to taped its potential in this area.

The President of Togo, HE Faure Gnassingbe, requested that CBC take part in the promotion of Togo to International Investors. The request was made after the President addressed the opening ceremony and hosted a private Togo investor roundtable during the Forum.

The Africa Investment Forum 2010 was a great success and we look forward to carrying this though to the next AIF in Uganda, February 2010.

Talks in Uganda

2010-02-01T14:31:00.002Z

Last week I was in Uganda to follow up on talks I had with President Museveni, while he was at the Commonwealth Business Forum in Trinidad and Tobago last November. We discussed how CBC could increase it interaction with Uganda, over the coming year, to develop an investment promotion programme, particularly focused on the areas of agriculture and skills development.

At meetings with the Minister of Finance, Hon. Syda Bbumba, I discussed the practical functions of the programme and the implementation details, particularly how we would help generate the required investment to support the growth of both small and commercial farms. We also discussed a similar plan for skills promotion in the country.

Before leaving the country on Thursday, I met with the Uganda Investment Authority, where it was agreed that CBC would bring its prestigious Africa Investment Forum to Uganda in February 2011 and that work would continue on the development of a large scale ICT park outside Kampala.

India - economic optimism for 2010

2010-01-25T17:11:00.003Z

After returning from India last week, one of the main differences in the conversations going on between business here in the UK and in India is the way growth is discussed. In the UK the talk is of recovery, in India the talk is all about how much the economy will grow this year. Discussion in India is optimistic, rather than the UKs current trend of Pessimism. The Federal Government of India is Predicting a return to growth of around 7% this year. The Chairman of ICICI bank is even more optimistic predicting India’s growth rate to be at 10% by 2011.

Much of this optimism comes from the changes we see in India, firstly the county never entered recession as the West did, there was only a slight drop in Growth. Secondly, the improvements to the country’s infrastructure are dramatic; the road network for example is almost unrecognisable from only 15 years ago. Entrepreneurs across the county are all looking for new opportunities, both national and international and the demand for luxury consumer goods in India is increasing year on year.

Ironically there is talk of Bonuses in the Indian Media, but it’s not focused on Bankers, rather IT companies. The rate of Growth in the IT sector has been much higher than expected over the last year, Tata Consultancy for example plan a 150% bonus pay out for 2010.

They are not the only company in the sector revealing higher than expected profits, nor is the IT Sector alone in displaying stronger than predicted results, the economic prospects for the coming year in India look great.

Commonwealth Games and Business

2010-01-14T12:29:00.002Z

Later this year Delhi will host the 19th Commonwealth Games, as with all large expensive international events it is the long term effects and impact that there success is now measured on. Business Involvement at the Games will be essential to ensuring the Games have a lasting impact on the City, and was one of the most important reasons for the city agreeing to host. As we saw recently in Trinidad and Tobago at CHOGM the private sector presence can contribute the most to the host country, the new partnerships and relationships that started there ensure that the organising country’s investment pays off over the coming years.

Sporting Events are no different - the world cup in south Africa, for example, is expected to pump around R21.3-billion into South Africa's economy and create an estimated 159 000 new jobs. CBC will be working with CII to ensure that the Private Sector from across the Commonwealth is represented at the Games and that the Business dimension of the games is Strong.

What will 2010 bring?

2010-01-06T11:42:00.000Z

Contrary to all expectations at the beginning of the year 2009 ended with a majority of the developing nations in surprisingly strong economic positions. Most of the largest developing nation stock markets have recouped all the losses made in 2008, and countries such as China and India have avoided recession all together, only experiencing reduced growth. 2010 will have a much greater emphasis on the G20 and the BRICs countries than we have ever seen.

Recovery in the developed nations will now depend much more on how the consumer acts in India, China and other emerging markets. Demand for imports of high value manufactured goods from the BRIC countries can help drive forward recovery in western countries. There is evidence that Germany, France and Spain are enhancing manufacturing capacity to match the increasing demand from India and other countries, I hope the UK will follow suit.

Energy is going to be an important sector in 2010 as we move more towards clean technologies it will create new manufacturing opportunities in both the developing and developed world. Infrastructure represents a similar opportunity, the high demand in India and Africa will create opportunities for specialised companies in the western world. Africa will be the focus of a push for increased global agricultural production.

As Developing countries return to stronger growth they will help push the whole of the global economy out of recession. Consequently, how the developing world manages its economies will have a much greater impact on the western countries than ever before.

2009 was not the end of globalisation as some predicted, rather, we have seen just how linked the world economies have become. Globalisation will now be driven more by the BRIC countries, the G20 and the developing world than before, so it is in all our best interests to see the Developing world do better.

In this light I hope that 2010 will see a successful conclusion to the Doha Round of trade talks, this will depend much on the level of emphasis the developed countries put on it. In 2010 I think the major difference will be in the respective importance of the G20 and G8. The G20 will come to the fore on most Global Issues. There has been a reversal that will be all the more obvious in 2010, for the last 2 decades the consumer in the West has been buying from the manufacturer in the East, now it is the Consumers in Asian Countries that will drive forward the next stage of globalisation.

Copenhagen, and the future

2009-12-22T17:49:00.001Z

The conclusion of the Climate Change Talks in Copenhagen has left us with a lot of lessons to be learned. The management of the talks left a lot to be desired both in terms of the Agenda and in the range of involvement. Developing countries do not like to be left out in the cold; they want to be fully involved in the talks that will have so much impact on their future development. I’m am glad to see the UN Secretary General has recognised this and will work to improve the negotiation process before the next round of talks

I must admit to a feeling of déjà vu watching the talks progress. Before Doha, it would have often been the G8 countries coming together, making decisions and then letting everyone else know what had been decided. While on this occasion the range of countries involved was much wider (almost the G20) it still excluded some of the countries that will be the worst affected by climate change.

One good thing is immediately apparent coming out of the talks, the high emission countries, the US, EU, China, India, Japan, etc are now fully involved in finding a solution to climate change and its causes. While the agreement is not legally binding, by publically committing to the accord the countries are recognising the problem and have agreed to work to keep global temperature rises below 2oc – this is progress.

One of the foreseeable outcomes of the agreement as it moves to implementation is the cost of development in developing countries increasing; this will change the future path of development. While the agreement makes previsions to increased Aid to the developing world, $30 Billion over the next 3 years, and $100 billion by 2020, this is not likely to be new money - the state of the finances in the developed countries makes that improbable.

The cost of development and the way it takes place will have to be reviewed, with less government money going to traditional development projects there may well be greater competition between developing nations to attract private sector support. Also the private sectors involvement, from the very beginning, in the roll out of carbon trading and the use clean technologies to the developing world is absolutely essential.

lets hope 2010 will be bring a new commitment from governments and the private sector to work for cleaner technology and lower emissions.

Commonwealth Business Forum

2009-12-15T17:35:00.001Z

It was a new and interesting experience holding an event the size of the Commonwealth Business Forum on a cruise ship. The Forum was instrumental in building new partnerships that represent the new global alliances coming out of the changes to the global economy caused by the financial crisis of the past year.

The Forum has become a key mechanism for developing south-south relationships and increasing investment to small states and developing countries. Examples of the real business done at the Forum include:

1) Agreements on Oil and Gas partnerships between Trinidad & Tobago and West African States

2) Agreement between British Companies to invest in Grenada on Agriculture

3) Agreement between Canadian Companies and the Government of Grenada to work together on Healthcare

4) Agreement between Malaysian Companies to work with the Caribbean on Tourism and Telecommunications

5) Agreement between Indian Companies and Trinidad and Tobago to work together on ICT projects

6) Agreement Between an American company and Trinidad and Tobago to work together on Clean Technology

7) Agreement Between a Dutch company and African States to work together on Clean Technology solutions

8) And many more…..

I am delighted to see such solid outcomes from the Business Forum and am certain there will be a lasting impact on the economies in the region over the coming years.

Aside from the business done, the Forum has become a key private sector event, where business can forge a strong dialogue with Governments on trade and investment issues. 10 Heads of Government, sharing a stage with over 100 business leaders, spoke passionately and informatively on topics such as climate change, the impacts of the financial crisis and ways of improving the business climate. The Forums findings were submitted to CHOGM for the Heads consideration and can be read here.

The 2009 Business Forum was the largest event the CBC has ever held it brought together over 1100 investors and interested parties for debated and discussion in 10 Plenary and 40 Breakout sessions. I look forward to carrying this success forward to all CBC will undertake in the New Year.

The Commonwealth at 60 and the Commonwealth Factor

2009-11-30T15:19:00.001Z

The role and significance of the Commonwealth is a perennial topic alongside every Heads’ meeting. As CEO of the Commonwealth’s business association, which links hundreds of vibrant companies across the 53 countries I find that the Commonwealth is often both undervalued and underappreciated. My concern is not that the association will wither into obscurity, but we need to always need to keep the association relevant for today. What is its greatest strength?

The Commonwealth’s unique selling point or usp is not in its institutions but in its networks, values and the more elusive, but potent, ‘Commonwealth Factor’. This derives from of a common historical experience reflected in the similar administrative, legal, financial and business practices that members share, as well as the use of the English language. The Commonwealth Factor when leveraged, as CBC does to promote trade and investment, with Commonwealth values of multi party democracy, human rights, the rule of law, good governance, free press, and socially responsible market orientated policies, is when real results are seen.

The Commonwealth Secretariat, the inter-governmental organisation of the Commonwealth, can’t be a leading development organisation, its budget is too small, a fraction of the larger NGOs. However, in my 25 years of experience with the Commonwealth it has been through more assessments than the UN and many other international organisations, all of which are very many times larger than the Secretariat. Unfortunately the Secretariat is undervalued, underfunded and over-assessed, and nothing much will be achieved by yet another assessment exercise.

Nurturing, leveraging and promoting the ideals and the values at the core of the Commonwealth, is the key to CBC’s success and has lead to greater investment opportunities in Commonwealth countries. Commonwealth member states are increasingly being seen as ideal locations for doing business, thanks in a large part to this ‘Commonwealth factor’. Intra-Commonwealth trade has increased from $2 trillion to $3 Trillion over the last 10 years, Investment flows have reached over US$180 billion and Commonwealth trade and investment accounts for over 20 per cent of the world total. The Commonwealth Factor, we believe, can decrease the cost of doing business by anything up to 15%. The Commonwealth is the home to some of the most dynamic and successful new global companies in fields critical to development – ICT, technology and energy, finance, and agriculture. Increasingly the modern Commonwealth is defined by the emerging economies – for example India, Nigeria, South Africa, Malaysia, Trinidad and Tobago – these are new economic centres of excellence growing in importance alongside the UK, Australia and Canada. The association is certainly not lacking in innovation and success.

Another aspect of the Commonwealth Association which is valued greatly across by member countries is skills development and education. I am disappointed by the NGO’s who are ‘so called’ advocates of the Commonwealth but dwell on the association’s past and are not looking to its future. The Commonwealth could obviously use greater resources, but of even greater import is sustained commitment to and recognition of the Commonwealth factor and networks, that can be leveraged to enhance the lives of so many across the association.

The future of the Commonwealth must focus on enhancing the characteristics I have mentioned, its values and networks so that more and more of Commonwealth Citizens can take advantage of their shared heritage.

India, Prudence and FDI

2009-11-13T19:58:00.001Z

The Indian Prime Minister’s, Manmohan Singh, recent announcements about new economic reforms, particularly the 10% divestment of public sector companies, is movement in the right direction.

India is satisfied that it has avoided the worst of the global financial crisis, its conservative banking system and high capital ratio have protected it from the worst of the global turmoil. However, this conservatism works both ways, yes it reduces risk, but it also limits access. In India, this means millions of potential entrepreneurs are excluded from the financial systems that they can use to prosper. Prudence is good, but too great a level can limit growth and exclude too many members of society. To accelerate the rate of growth India should, perhaps, be a little less prudent.

Relatively low levels of FDI in India, only $121 billion over the last 8 years, are a mystery to me. India represents a fantastic investment opportunity and the levels should be higher. Recent Figures have shown a 9.1% increase in industrial production from last year, and the Government’s commitment to $500 Billion in infrastructure investment, a figure that will be far higher when including the Private Sector contribution. The IFC, the World Bank’s private sector arm, decision to increase India’s exposure from the $3.4 Billion or 10% of its portfolio last year, are all signs of confidence in India’s policy and growth. As one of the few countries where economic activity is near levels hit before the economic crisis, India will prove to be one of the most attractive investment destinations over the coming years.

Indian Infrastructure

2009-11-05T20:00:00.000Z

I had the pleasure of attending an event with President Patil of India last week. The President was in the UK to promote UK India relations and strengthen business ties between the 2 countries. Last week was very much an ‘India week’ in London, demonstrating the importance of the relationship to the 2 countries the President’s trip coincided with the return of the Lord Mayor of London from India where he was leading a business delegation from the City.

I feel, that while there have been successful experiences for UK Infrastructure companies in India, CBC members Arup and Mott MacDonald to name a couple, the experience has not always been as rewarding. Due in part to the Strength of the Home Grown construction sector that is better connected than International companies can hope to be. The lesson for UK construction companies in India is to find the right local partner, one who shares the same business goals and has the capacity to deliver. While there are challenges to finding the right partner in India the arguments in favour of entering the market allied with an Indian company are overwhelming.

Not to Award Africa Governance Prize – A Mistake

2009-10-23T19:03:00.000+01:00

Not to award the Africa Governance Prize is a mistake and the wrong decision. The Prize is awarded by the Mo Ibrahim Foundation to leaders that have ‘ruled wisely’ and ‘handed over power to elected successors’. All 3 Presidents, Thabo Mbeki, Olusegun Obasanjo and John Kufuor, with some blips, have brought their countries forward and have been succeed by democratic means. I have known all 3 Presidents personally and worked with them over the years, they have worked in difficult times and circumstances to the benefits of their respective countries. Even recognising their faults and flaws, if Leaders such as these 3 aren’t eligible, President Mugabe must be having a good laugh!

I wonder at the Jury’s intentions by not awarding, are they trying to raise the bar for African leaders in the future? If so, it seems unlikely that the Foundation will award a prize in the next few years. If these criteria were used globally, would the jury be able to pick a winner?

Perhaps, if the prize was awarded to the Presidents who are still serving their first term; it could have a more direct impact and improve the performance of an incumbent government, providing an incentive to govern well and a democratic transfer of power.

Solar Technology and the Commonwealth

2009-10-21T09:23:00.001+01:00

Solar Technology has the potential to supply all the worlds energy requirements, 6000times the worlds electrical needs constantly shines on the earth. Many Commonwealth countries are well placed to make use of solar technology for energy production; high levels of Sunlight and wide opened space make them ideal locations for the technology.

Proven projects across the world show the impact the technology can have. Germany, surprisingly given its relatively low levels of sunlight, is leading the way with Spain not far behind and the new administration in the US has placed a greater emphasis on increasing their solar output and combating climate change.

There is still work to be done on the technology, issues surrounding night time storage and efficiency, but work continues to make the technology more economical viable. I was in Kenya last week to look at a potential solar project site and meet with partners, one of CBC’s aims is to use and share technologies that can help with development and improve the lives of people across the commonwealth, and solar is a technology that could have a huge impact.

Health Tourism and Infrastructure

2009-10-12T17:30:00.001+01:00

Last week while travelling in the Caribbean the potential importance of healthcare to some of the island economies became more and more apparent. The global financial crisis has driven down the number of tourists travelling for traditional Caribbean holidays, so the governments and tourist promotion agencies are looking for new ways of attracting visitors to their shores.

Aside from the more mainstream efforts to promote business tourism and the like, there is a good opportunity to become a destination of choice for medical tourism. A similar desire was espoused by the Prime Minister of Grenada while at a Lunch I hosted in the UK a couple of months back, however he made it clear that there is a large infrastructure gap to filled in this sector.

This is a good example of where government and the private sector can work together to create an affordable, highly advanced and comfortable medical environment that is suitable for more elderly patients. The Caribbean is an ideal location for this industry, with its experience in delivering a 5 star tourist experiences and its proximity to the Large US market.

Ugandan Infrastructure and FDI

2009-09-29T10:16:00.004+01:00

I was very pleased to have the opportunity to meet with HE Yoweri Museveni the President of Uganda last weekend while he was passing though the UK on the way to New York. President Museveni hosted CHOGM and Commonwealth Business Forum in 2007, it was good to catch up and talk.

A couple of Points he raised were of particular interest;

1)
Firstly, Uganda is re-prioritising reducing the Infrastructure gap as quickly as possible. A renewed focus on building and renovating, roads, rail, ports and especially power generation and delivery will remove one of the largest hurdles to development and growth.

2)
The Second point was perhaps the more pertinent; President Museveni made it clear that while he will more than welcome Foreign Direct Investment, the Ugandan Government was prepared to pursue large Infrastructure projects alone. The Financial crisis has made accessing traditional sources of funding harder than ever before, and with the discovery of oil in the Lake Alberta region earlier this year; Uganda now has a greater confidence that it can find its own solutions to its infrastructure issues.

The government is continuously increasing its allocation for infrastructure projects in annual budgets, this is good news. Uganda and other African countries are becoming more confident in shaping their future, similar sentiments were expressed by the Presidents of Ghana and Rwanda when I met them recently.

The G20 and Global Trade

2009-09-24T09:39:00.001+01:00

The G20’s agenda has radically changed over the last year; discussion now centres on the financial crisis and the future management of the global banking system. I am saddened to see Global trade had slipped off the G20s radar, with the Doha Round looking increasing unlikely to be revived this year further talks on this important topic are needed.

Despite the current economic turmoil the Global Trade is growing and increasing, particularly Intra-Asian Trade, the Asian Development Bank recently stated that “the region would grow more strongly than expected this year and in 2010…Despite [difficult] conditions in the global economic environment, developing Asia is poised to lead the recovery from the worldwide slowdown”.

Asia’s continued growth is despite the decline in Trade with the traditional western markets, growth has benefited from strong Intra-Asian trade. Intra-Asian trade has helped maintain growth while the largest export markets have dramatically reduced their spending. CBC feels that Intra Africa trade can follow the same model; we have been working with governments and the private sector over the last 10 years to enhance this. We have seen impressive increases and look forward to working with partners to push this even further.

We hope that global trade will soon be back on the agenda for G20 meetings.

A socially relevant banking system

2009-09-17T16:39:00.000+01:00

It is clear that the G20 meetings of Heads of Government and Finance Ministers are becoming a useful forum for tackling the banking crisis. Sharing ideas and experience is essential for the development of a new legal framework for the banking industry. The framework must walk a narrow line of preventing the kind of extreme risk taking that caused the financial crisis, without stifling the banking sectors ability to innovate.

What is clear is that banks can no longer be seen as an offset part of society, answerable to no one. If banks are so important to a Country that they cannot be allowed to fail, it is essential that they are not seen to be performing ‘Socially useless activities’ as Lord Turner, Head of the FSA put it.

It is a good sign for the Banking Industry and for all of us, that those who work in the Sector have been soul searching and are beginning to see the need for a socially relevant industry. Speaking in the FT over the weekend the Chief Executive of Mitsubishi UFJ Financial Group, japans largest bank, said “if we blindly pursue profits to an excessive degree, it results in many things going wrong”. He argues, quite rightly I think, that a banks role should be “as a lubricant for economic activity” and that financial innovation is fine “as long as it leads to greater social welfare”.

Should History Limit the Commonwealth?

2009-09-03T09:44:00.001+01:00

Members of the Commonwealth are predominantly linked by their history with the British Empire, but should this be the limit of the Commonwealth? Should other countries that sign up to the association's beliefs be welcomed into the club?

The Commonwealth’s focus on multi party democracy, human rights, the rule of law, good governance, free press, and socially responsible market orientated policies give it a strong legitimacy in today’s world and allows for the association to become an even stronger force for good.

The shared use of the English language is one of the Commonwealths strongest features. Alongside similar administrative, legal and financial practices it makes doing business in the commonwealth easy. The Shared language makes for the easy and equitable transfer of knowledge around the associations nations.

I see no reason why the Commonwealth should not expand to encompass all nations that share similar views and follow similar practices. Perhaps commonwealth expansion should be one of the topics in the Royal Commonwealth Societies ‘Commonwealth Conversation’ after all a bigger commonwealth would be good for business.

Ghana - Power, Agriculture and AIF 2010

2009-08-20T13:09:00.003+01:00

While visiting Ghana for the first time in several years I was fortunate to have the opportunity to call on the President, HE John Atta Mills. It was good to continue our conversation started when CBC hosted him and his team for the Ghana Investment Forum back in May in London.

During my meetings with the President and several Ministers two main themes running through the government’s programme became apparent.

1)
Managing the proceeds of the newly discovered petroleum and gas reserves for growth and development. The President is inviting international investors to work with his government to develop the infrastructure that will make growth happen.

One of the Key restraints on Ghana’s growth and development is access to power. The county’s current capacity is around 2000 Megawatts, Ghana needs to produce around 5000 a year to match the demand. The Government is looking for investors and technology to help produce power from the country’s gas, petroleum and other sources including renewable, and in its delivery to the public.

2)
The second theme of government policy is on agriculture. The Government is determined to enhance production and encourage commercial farming practices, to take Ghana from a net importer of food to an exporter in the shortest time possible.

Ghana, having built on the solid base of democratic principles and an open economy, is fast becoming the model of a modern African economy. I am glad to see Ghana aiming high; to achieve its goal of becoming a middle income country by 2015 the country will have to achieve growth of between 8 and 10% a year and attract international investors to help bridge the infrastructure gap.

My advice to investors everywhere is to use Ghana as the window to Africa, and join us at our Africa Investment Forum in February next year as we hold it in Ghana for the first time.

African agriculture solution to future food shortages

2009-08-11T10:20:00.004+01:00

In recent comments from DEFRA about Food Security in the UK, it was suggested that global food production would have to double by 2050 to feed the growing global population. The Report went on to highlight the Role Genetically Modified crops are likely to play in increasing production as higher yield crops are needed to bring production up to the required level.

While GM will have a role play in the coming years, greater emphasis should be put on Africa as a potential global supplier.

The Current state of much of the agricultural production on the continent is still subsistence based, where families or small communities produce, in many cases, barely enough to live on, let alone a surplus to export.

Africa's potential to become the food basket of the world and supply a large percentage of the Global requirement is enormous, and CBC is working with private sector partners and governments to help increase investment into agriculture across the continent. An upturn in Production has the added benefits of increasing food security, reducing the threat of famine, creating jobs and wealth and driving up the general standard of living across Africa.

Commonwealth Conversation and the Commonwealth Factor

2009-08-05T10:51:00.003+01:00

I was very pleased to note that the Foreign Secretary the Rt Hon David Miliband has initiated the dialogue on the future role of the Commonwealth, in this 60th year of operation.

Those of us who work in the Commonwealth recognise its importance, but are disappointed by the lack of recognition the association receives. The Commonwealth is underutilized and I hope this ‘commonwealth conversation’ can help to remedy this.

I was delighted to see that the CBC was identified as one of the key organisations within the commonwealth family alongside the Secretariat and the Commonwealth Foundation, in the Foreign Secretary’s paper ‘Two Billion Voices’.

I believe that member countries benefit most from the commonwealth when they leverage the ‘commonwealth factor’, such as similar administrative, legal, financial and business practices to help enhance trade and investment in their countries. These shared features make trade easy and cheap, and CBC is delighted to have made some small contribution to the increase in Commonwealth Trade from 2 trillion to 3 trillion dollars since its inception in 1997.

The Commonwealth can become an even stronger force for good, promoting, multi party democracy, human rights, the rule of law, good governance and socially responsible market orientated economic policies. Another key factor that binds the commonwealth is the use of the English language, which is a key asset for the economic development of member countries.

Countries that subscribe to these beliefs should be welcomed into the Commonwealth Club and join in its success.

India UK Merger and Acquisitions

2009-07-24T09:23:00.001+01:00

Between 2000 and 2008 over 1000 Merger and Acquisitions took place between British and Indian Companies, these deals were worth over 75 billion Dollars. The total number of deals is expected to drop in 2009, due to the financial crisis and less easy access to credit, but the value of those that do go through is expected to remain high.

India and the UK's shared heritage make them ideal business partners and in recent years the quantities of money involved have been impressive, but mainly made up by one or two 'headline' multi-million dollar deals a year.

The next step is to promote the greater interaction between small and medium size companies in both India and the UK, as these are by far the largest employers and would have the greatest impact on the general economy.

Presidents Optimistic about African Future

2009-07-16T10:44:00.002+01:00

Over the Weekend I was pleased to catch President Obama’s speech to the Ghanaian Parliament. The US President focused on many issues that I and CBC believe are important for the future prosperity of the African Continent.

President Obama spoke of Africa’s future being in African hands, “aid is not an end in itself. The purpose of foreign assistance must be creating the conditions where it is no longer needed”. He went on to talk of a Continent not only rich in natural resources, but also entrepreneurs where “cell phone entrepreneurs to small farmers, have shown the capacity and commitment to create their own opportunities”
This optimistic view of Africa is shared by HE Paul Kagame who I met last week while he was in the UK to speak at our Africa Business Forum. He commented that the only thing holding Africa back now was the lack of a vibrant business-public sector relationship. “We have the people, we have the recourses and we have proven that investing in Africa gives you the highest possible returns available anywhere in the world”.

I believe that Africa is well positioned to emerge from the recession stronger than ever, and am glad to see that there is a general consensus around the world, after all the continent is still displaying growth rates above the global average. There is a new confidence both within and outside the continent in the African future.

Grenada, the financial crisis and tourism

2009-06-19T11:04:00.000+01:00

During this time of financial crisis smaller states need to work hard to find new ways of attracting foreign capital. CBC recently hosted a lunch for the PM of Grenada, Hon. Tillman Thomas; I was interested to hear how he plans to tackle this problem in his own county.

With the reduced numbers of people travelling for the traditional holiday, countries that rely on tourism for a large percentage of their income need to broaden there appeal and try to attract different visitors in addition to the traditional holiday maker. The Prime Minister described how his country was diversifying into, Eco Tourism and Health Tourism. He also talked of making the country self sufficient in terms of Agriculture – he wants the majority of what tourists consume to be produced locally, there should much fewer agricultural products imported for tourists.

I was also glad to hear the Prime Minister talk so passionately about a home grown chocolate bar that has now found a market in Europe.

Mr Sanusi appointed Nigerian Central Bank Governor

2009-06-12T15:58:00.001+01:00

Last week I was in Nigeria to attend a Business Breakfast organised by Mr Pascal Dozie, one of CBC’s Board members, and was pleased to catch the Senate Confirmation Hearings of Mr Sanusi Lamido Sansui as the Governor of the Nigerian Central Bank on TV.

I was glad to see Mr Sanusi, former CEO of First Bank, a CBC Member, appointed as the Governor of the Nigerian Central Bank though a true governance process; the senate questioned him in detail on topics of great importance to the banking system and the Nigerian Economy as a whole, including Regulation and Recovery. Coincidently, Mr Sanusi is the Second Central Bank Governor of the same name to move from CEO of First Bank to the Governorship.

In General the impression I got from the Business men and women I met in Lagos was extremely upbeat; there are tremendous opportunities for investors in Nigeria, especially within the Infrastructure sectors. Government and Infrastructure Companies are actively and determinedly seeking outside investors to help develop the infrastructure base, in Lagos and other regions.

Indian Elections

2009-05-27T15:33:00.001+01:00

I would like to congratulate Manmohan Singh on his election as India’s Prime Minister, the workings of the world’s largest democracy are an impressive sight nearly 1 billion people have chosen their representatives.

This election marks a particular change in India’s politics; the congress party now has a working majority and can no longer be held to ransom by the smaller parties that were previously able to prevent governments from taking action. With the ruling party now longer beholden to minority interest progress can now be made on the Doha round as both the US and UK want and expect, leading to further economic reforms in the labour, legal and financial spheres.

Equally India has a major role to play in the response to the financial crisis; European and especially UK Business are looking to India as partners for ventures there and abroad with a high expectation of success. Finally with India looking to be one of the big winners in the proposed IMF reforms in terms of voting rights, India role in the global economy and the Institutions that govern it can only grow.

Dealing with Cuba the Commonwealth Way

2009-05-05T12:27:00.001+01:00

I am extremely pleased to see the approach the new US President has taken towards Cuba during his first 100 days in office. Moves to lift some of the travel and trade restrictions could open a dialogue between the 2 countries that has been closed since President Kennedy isolated the Island in the 60s.

Engaging the countries that were previously given pariah status is a good step forward, talk that leads to understanding is always preferable to conflict. President Obama is using strategies similar to those we use in the Commonwealth in his dealings with Cuba, by lessening the restriction on Cuba a white house press spokesman reported that the president hopes “that creating independence, creating space for the Cuban people to operate freely from the regime is the kind of space they need to start the process toward a more democratic Cuba”

By engaging in direct dialogue change can be encouraged in good governance, human rights and economic development, this is the approach the Commonwealth has taken and now we are a community of 53 democracies.

South Africa's Elections

2009-05-01T09:02:00.001+01:00

I would like to congratulate Jacob Zuma on his recent election as South Africa’s President, and wish him luck with all the challenges that await him, both economic and political. However, while South Africa celebrates his election, it is important not to forget the efforts of his predecessor, Thabo Mbeki.

While President Mbeki’s stance on Aids and Zimbabwe may have been regrettable, his impact on the South African economy cannot be overstated. South Africa’s sustained level of economic growth is the success the Mbeki’s presidency should be remembered for.

Consequently, I was delighted to read over the weekend that Trevor Manual, the South African Minister of Finance closely related to the Countries economic success, looks set to play major role in the Zuma Government. This should allay fears that the new government is not focused closely enough on the Economic side of rule.

Steady Eddie and the Commonwealth Education Fund

2009-04-27T14:08:00.001+01:00

I was Saddened to learn that Edward George former Governor of the Bank of England whom I had the pleasure of briefly knowing had passed away.

Most people will know him as ‘Steady Eddie’ from his time at the Bank of England, but I came to know him better through his work at with the Commonwealth Education Fund (CEF). The Fund was set up by Prime Minister, Gordon Brown during his time as Chancellor to help the lower income countries of the Commonwealth achieve the ambitious education targets set out in 2000 in the Millennium Development Goals.

Eddie George Chaired the fund from its inception till its close in 2008 and was a passionate about ensuring children across the commonwealth had the best possible start in life. The CEF’s approach was innovative, by bringing together many different groups the fund aimed to make education a top political priority and matter of open public debate in each country in which it operated.

The CEF had a significant impact in the countries in which it worked, and Eddie will be missed by many in the UK and across the commonwealth.

Agriculture and Insurance in Africa

2009-04-20T17:13:00.001+01:00

I am pleased to see that most African countries are moving agriculture to the top of their agenda. Through my interactions with the Heads of Governments in recent months, I have recognised a renewed interest in making Africa the food basket of the world.

This is the right time to take action on agriculture, if governments, the private sector and NGO’s work together a real impact can be made on the lives of those who merely ‘subsist’ across the whole African continent.

The CBC is contributing to this effort, connecting businesses and governments to form the right partnerships for swift progress to be made. In a recent programme report co-authored by Swiss Re (a CBC member) we highlighted an element of agricultural development that’s importance is too often forgotten; insurance. The programme makes suggestions as to how PPPs can be used to enhance agricultural production, and investment in agriculture, buy reducing against volatility assuring more stable returns. To read the report please visit cbcglobal.org

The G20, the IMF and the Doha Round

2009-04-08T15:13:00.003+01:00

The G20 meeting last week is being hailed as a success and in many respects I think it was, I hope it will be a helpful step on the road to recovery. The meeting represents the start of a new global process as both the developed and emerging economies come together to form a new Global Forum.

For the developing countries, one of the best outcomes was the larger commitments made to the IMF. According to the Closing statement the Organisations resources have been trebled to $750 Billion, consequently the IMF is going to become a much more important actor on the world stage. The next thing on its agenda must be reform and reorganisation to ensure it can match its new responsibilities in restoring the flows of trade and finance to the developing world.

I was, however, disappointed by how little progress was made on international trade. The requisite statements were made regarding resisting protectionism, but a stronger commitment to the Doha round would have been encouraging in this time of decreasing global growth.

Africa to buck recessionary trend

2009-03-25T13:14:00.001Z

While visiting East Africa last week I had the opportunity to meet with both President Museveni of Uganda and President Kagame of Rwanda to discuss the global financial crisis. It is apparent that there is a lot of innovative thinking going on in Africa right now, around how to resist the severe impact of the Global crisis and maintain the flow of FDI.

A Recent article in Time Magazine ‘Africa a Business Destination’ demonstrated this, reporting that while ‘Africa, usually the poorest performing region in the world economy, is now likely to be among the best-performing’. A consequence of not venturing into the derivatives markets or subprime lending as the west did has left the continent relatively immune to the Global Crisis. While recent the latest estimates for global growth this year look bleak, the same article reports that Africa will ‘buck the recessionary trend’ and grow over 3% this year.

New ideas are emerging regarding investment in Africa in sectors such as Agriculture, Infrastructure and ICT. It is a new reliance on business as cash rich countries such as China and the Middle East look for new markets in which to invest, that will fuel this growth. Even the Investment funds in the UK, Europe and the US are beginning to take serious notice of Africa as an investment destination, practically the agriculture sector.

The Caribbean and the Financial Crisis

2009-03-11T12:09:00.000Z

I was in the Caribbean last week preparing for our Business Forum to be held in Trinidad alongside CHOGM later this year, so was meeting with government and business leaders, 2 main concerns seem to be affecting the islands’ leadership.

Firstly that the financial crisis is having a direct impact on the islands economy as the level of tourism drops off as potential visitors in the US and UK chose not to travel or to stay closer to home for their holidays. I hope that the various stimulus packages proposed around the world shorten the duration of the Recession and allow growth and prosperity to resume as soon as possible as a drop in the level of tourism is a serious threat to smaller states.

Secondly, there is an indirect consequence that may potential have a bigger impact on some of the island states. The current trend of viewing tax heavens as separate from the rest of the globalised economy and as singularly bad, the focus should be inclusive and on the greater involvement of small states as part of global competition and as useful elements of the global economy.

The threat to the Burgeoning Bourgeoisie

2009-02-27T09:47:00.001Z

In the last edition of the economist there was an article, the ‘burgeoning bourgeoisie’ that said ‘for the first time in history more than half the world is middle class’. It also highlighted that while the increase India and China has been, as expected; massive the middle class has increased dramatically across all emerging markets. There are for example 80 million more middle class Sub Saharan Africans today than in 1990.

This growth in prosperity is something I have been working for throughout my career, but it is fragile and millions of lives now rest on the decisions that will be taken in the developed world over the coming months. The banking crisis has left millions of the world’s population in real peril and the longer the crisis continues the more of this new middle class will slip back into poverty.

From G7 to G20 - The Financial Crisis

2009-02-18T17:11:00.003Z

The G7 finance ministers meeting on the 13th passed almost un-noticed there were the requisite statements on coordinating the response to the financial crisis, resisting the pull of protectionism, and the importance of free trade, but no progress on an international trade deal, or a global response to the crisis.

The real priority is to shore up the banking system. Governments should take action together to remove toxic assets from banks’ balance sheets through insurance schemes, and reopen the flow of credit. Im surprised that Governments are mainly taking advice from bankers in this restructuring, when input should come from as wide as possible, including other sectors of the economy.

Attention is now focused on the G20 meeting in London in April, with many hoping that it will become the starting point for recovery, for a new global financial and governance structure.

Trade Talks and the Financial Crisis

2009-02-11T13:50:00.002Z

The current state of the world economy and the financial crisis makes the successful conclusion of the Doha Round of trade talks all the more unlikely.

The Heads of the G8 Countries are making all the right noises about resisting the draw of protectionism in a retracting market situation and with increasing unemployment at home, but for all this, the result is the same; the Round is not likely to be completed in the present climate and almost certainly not within the year.

While I congratulate Pascal Lamy for his continuous and seemingly untiring efforts to keep moving forward with the Round, I do not believe that either the upcoming G8 or G20 meetings will hasten the conclusion of the Doha talks.

Slumdog Millionaires….

2009-02-04T15:12:00.003Z

While in Bombay last Month my wife and I along with some colleagues from the UK and Canada, saw Slumdog Millionaire, I thought it was an exceptional film, Danny Boyle should be extremely proud, particularly of the way he captured the image of India. I know the author personally, we met while he worked at the Indian High Commission in the UK, I had the pleasure of reading an early version of the book, it’s a great and inspirational story.

I was however disturbed to read, the allegations lodged against the films makers that the children who starred in the film were paid almost nothing and are still living in the same conditions as when they were discovered by the casting scouts.

I hope these allegations are not true, and that some of the films profits will reach the people who live in the slums, particularly the kids who starred in the film, as Danny Boyle has since said. There is a potential millionaire, born every day in all the Slums of India.

Scandals and Corporate Governance

2009-01-29T15:47:00.000Z

During my recent trip to India, the papers were full of stories about corporate governance triggered by the recent Satyam Scandal. Satyam was one of India’s top 4 IT Companies and the 2008 winner of the coveted Golden Peacock Award for Corporate Governance under Risk Management and Compliance Issues, of which it has since been stripped.

The arrest of Satyam’s senior leaders including, Vadlamani Srinivas, Ramalinga Raju, and his brother Rama Raju on charges of false accounting and fraud in what has been described as India’s ‘Enron’, coupled with the Madoff scandal in the US, the largest investor fraud ever committed by a single person, clearly demonstrates the need for system of corporate governance based on values and transparency.

These 2 scandals highlight the danger of putting too much faith in a single person rather than an Organisations as a whole, the leading figures in both scandals took advantage of their positions and reputations to defraud large numbers of people who trusted and entrusted them with their money. While the majority of business leaders are upstanding and trustworthy, there should be no circumstances when a leader should be above their organisation.

India and the emerging markets the solution to the Credit Crunch?

2009-01-15T09:30:00.002Z

In the context of the recession and ‘credit crunch’ I think people would have been amazed had they been in Gujarat yesterday and the day before, nearly 20 000 people attended the opening of the Vibrant Gujarat Global Investor’s summit 2009. India’s captains of industry and its top business leaders were present for the summit as well as representatives from governments around the world.

In the session I chaired, ‘Infrastructure with a focus on Special Investment Regions’ there was a stampede to sign MOU’s, it was an amazing site, to see so much confidence in India’s particularly Gujarat’s growth. Companies from all round the world were falling on each other to sign, Japan, Germany, the US, the UK, China, Korea and South Africa among many others.

The PM of Kenya and the Vice President of Uganda along with the numerous ministers from many African and Asian countries who were present for the summit seemed almost dazed at first by the response from business were desperate to learn from the experience.

The summit is the perfect antidote to all the news floating around about investors to nervous to invest. It was a hugely encouraging experience, India; especially Gujarat is the place to be. I have no doubt the solution to the credit crunch lies in emerging markets like India where there is still growth and the opportunities for business, as demonstrated over the last couple of days, is huge.

Dubai, Singapore and Malaysia optimistic about global financial crisis

2009-01-08T16:15:00.001Z

Before the Christmas break I had the pleasure of taking a whistle stop tour of Dubai, Singapore and Malaysia. It gave me the opportunity to see firsthand just how ‘global’ the current financial crisis is, reaching out from the west, and affecting the rest of the world.

In Dubai the construction industry, long a pillar of the countries growth, has ground to a virtual halt and the price of Real Estate has dropped dramatically, but there is none of the panic or pessimism that’s visible in the west.

Following meetings with several of the financial groups in Dubai the impression I received was one of optimism in the long term. There was the belief that this current crisis was inevitable, that the last few years growth had been unrealistic and un-sustainable, and that the current recession is a correction.

There is even less pessimism in Kuala Lumpur and Singapore, the belief that the storm can be weathered is strongly rooted and that after a period of stock taking growth will resume, albeit with more realistic returns. This feeling of optimism is something that I and the CBC will tap into as we actively participate in both Dubai and Malaysia later in the coming year.

3 further ideas to help the UK through the current economic storm

2008-12-12T09:43:00.005Z

Purchasing the surplus housing stock of troubled home builders
The Government could consider purchasing surplus stock, particularly at fire-sale prices, from companies such as McCarthy & Stone and Crest Nicholson (both of which are restructuring and have roughly 5,000 unsold housing units) the government would be able to make an immediate impact on social housing, unclog the balance sheet of troubled homebuilders and allow construction activity to resume

The creation of a public fund for innovation
Also, establishing a Fund to support innovation in manufacturing and export oriented industries could incentivise R&D units and university based research to focus on creating goods and services for export. The UK economy will need to position itself for a changing economic landscape – one in which consumption and consumer spending will become less reliable engines of growth and external markets will become as much a destination for export as they were a source of goods and services imports

Long term tax breaks for export oriented and manufacturing sectors
Finally, the promotion of the UK (through tax credits and regulatory reform targeted to foreign entities) as a destination for cash-rich companies in China, India and a Middle East as a base for high-end manufacturing and export oriented industry.

Extraordinary solutions to extraordinary times, my ideas to help the UK economy through the financial crisis

2008-12-10T09:10:00.004Z

Speaking to the CBI in November this year, Gordon Brown said “All over the world, policy makers are leaving behind the solutions of yesterday and recognising that extraordinary times require extraordinary actions”. While I expect the most effective solutions to the current crisis will be monetary and regulatory in nature, I propose a couple of ‘out the box’ ideas that I believe will help the most vulnerable in society while hopefully reducing the impact of oncoming recession.

The creation of community banks
Small businesses account for more than half of Britain’s GDP and employ more than 13 million people across the country. I believe the government should promote the formation of strategically placed community banks to help ensure a fair supply of credit to small businesses. These banks could be run by healthy banks (HSBC, Santander) in equity partnerships with government who can target them at specific geographic areas ensuring the most vulnerable groups get the help they need.

A Government sponsored asset manager
I think it would be sensible to establish a Government Sponsored Asset Manager whose sole mandate would be to bid and purchase illiquid and distressed assets from banks. Many assets on bank balance sheets are mispriced owing to the near failure of trust in the interbank lending market. An independent entity that is a ‘buyer of last resort’ – one that has a mandate to analyse and make last bids on those assets – would allow troubled banks to improve solvency. The creation of such an entity should be considered within the context of regulatory reform of financial markets.

There will be more suggestions soon....

The menace of terrorism will block South Asia’s efforts to alleviate poverty and generate economic growth

2008-12-08T10:37:00.002Z

The incident in Mumbai is bad not only for India, but for the entire region. It should be condemned by all people in South Asia and they should be united in their resolve to ensure it doesn't happen again in the region. Half of the world's poor live in South Asia and such incidents will keep the region in poverty and hold back efforts to achieve economic growth and poverty alleviation.

The Commonwealth Business Council has been working with business and governments and SAARC to enhance trade and investment linkages in the region to underpin wider economic growth. After the events in Mumbai, international businesses are more committed than ever to enhance the partnership with South Asian business. I hope that the leaders and people of South Asia will be even more determined to fight the menace of terrorism for the sake of economic development in the region.

India must take immediate and large-scale action to prevent repeats of last week's attacks

2008-12-03T09:06:00.000Z

My thoughts are with the families of those caught up in the terrible attacks in Mumbai last week.

India cannot ignore this incident; fear of repeats may drive business from India. Both World and Local business expects a clear response from the Indian Government and large scale steps to improve security and administration in order to minimise the chance of a similar attacks occur again.

I welcome the appointment of Palaniappan Chidambaram to the role of Home Minister, he has proven himself facing the challenges in the finance portfolio, and must now make tackling security and terrorism his number one priority. Retaining the confidence of the international business community is essential, more action must be taken, and more heads must role in both Mumbai and Delhi. India must now take immediate and strong action, in the manner of the US and UK following similar incidents, small steps will not inspire confidence. India must act like a world economic power to give confidence to businesses already in the country and to those on their way.

I am a regular visitor to India and have stayed in the Taj and Oberoi Hotels many times, last year I was in the Taj with over 100 business leaders and am determined to return with even more.

What to do in the Wake of Doha Collapse

2008-08-08T15:39:00.000+01:00

The Collapse of the Doha talks in Geneva last week is a shame, it weakens the WTO as an international institution and gives us a worrying view of the international communities intransigence even when perusing things that would benefit all, namely Freer Trade. What will happen when the harder and more devise issue of Climate Change is up for debate?

I am sure Pascal Lamy will attempt to resurrect the Round, but when is another matter, the upcoming US elections will make this all the harder, with both candidates advocating differing positions - negotiations may well be back at square one before they even start.

In the mean time then, I believe that each Country represented at the talks should demonstrate its commitment to Free Trade, by unilaterally putting in place what they would have accepted in Geneva. If India and China, for example, were to open their agricultural industries, even with the contentious ‘safeguard trigger’ in place, trade would still increase and all would benefit.

This I believe is the best way forward; it will demonstrate the international community’s commitment to Free Trade, and make resurrecting the Round easier as everyone’s position will be readily apparent when talks eventually restart.

Africa as an Investment Destination

2008-02-05T17:00:00.000Z

In the past six months we have fortunately seen an unprecedented interest in Africa as an investment destination. Interest in African commodities was always there and the surge in commodity prices has helped companies to take notice of other areas as well.

For the first time, banks, financial institutions and private equity firms have started looking to invest in African services and markets.

This was in part helped by the fact that countries like Sierra Leone, Congo and Rwanda have successfully moved ahead from their war torn past to promote good governance and economic liberalisation.

Interest in Africa was palpable in Kampala when we organised the Commonwealth Business Forum in November 2007. Leading multinational and private equity firms including Blackstone, CDC, Barclays showed interest in investing in the Continent.

However, unfortunately because of the Kenya crisis, the goodwill is wearing away. This unrest will affect the whole of East Africa. It will be difficult to sustain investors’ confidence under such circumstances. Kenyan and other African leaders must find a speedy solution to the crises.

Gordon Brown's Visit to India

2008-01-16T17:00:00.000Z

British Prime Minister Gordon Brown’s India visit is imminent and the CBC is looking forward to seeing more business partnerships between the two countries. I am in India at the moment and it is heart warming to see the strides that the business community is making in India.

UK and India are engaged in one of the most profitable and significant bilateral trade and investment partnerships in the world. Increasingly, most major British companies consider it essential to have partnerships in India. And a growing number of Indian companies are getting on the LSE and the AIM listings.

I have through the CBC worked very closely with business leaders and government ministers to enhance bilateral trade and strike up partnerships in areas of finance, technology and innovation. A lot of work has gone into trade liberalisation. CBC also regularly organises business meetings in London with visiting Indian ministers.

Highlighting the growing influence of India, CBC is hosting its annual Global Business Leaders Forum on March 18-19 in Mumbai to be attended by Paul Skinner, Chairman, Rio Tinto; Gary Hoffman, Vice Chairman, Barclays; Richard Laing, Chief Executive CDC; John Studzinski, Senior Managing Director, Blackstone Group; Rahul Bajaj, Chairman Bajaj Auto, Anil Khandelwal, Chairman, Bank of Baroda; Naina Lal Kidwai, Country Head HSBC; and ICICI CEO KV Kamath. The business leaders will discuss ideas and exchange views and experiences on how to grow in a fast changing global business environment.

The Commonwealth Business Council (CBC) will also release the much-anticipated report on Indo-UK Trade in March 2008. The submission is based on the Council's ongoing work to achieve its objectives which is to promote global trade and investment.