"Our future is global or it is nothing'',

'Forget Europe. Follow the money'. So says City AM's Allister Heath in his editor's letter this morning (23 October).

China to the rescue?

If Allister Heath (City A.M. 29th Feb) is right, China needs to get its banking system in order. A new report from Lombard Street Research shows that China's household debt is 29% GDP, net company debt is 76%, gross government debt is 79%. When massive reserves of 43% are factored in, net government debt falls to 36%. and total debt is thus 141%.

On the surface things look okay, but there is an underlying weakness. In the event of a crisis it is already at the limit of what it could absorb. Give it another couple of years and the situation would become unmanageable. Help!

UK inflation

Check out the Chancellor's verdict on inflation levels when he pronounces on the budget tomorrow. If it's anything like what the Treasury is quoting at the moment - 1.9% - it's likely to be porky pies. It was 2.9% last year, and, if my wallet is anything to go buy, it feels to be rising steadily.

According to Allister Heath in City A.M., this makes a big difference to economic predictions. The difference between success and failure/boom or bust for public spending.

We need more large multinationals

I make no apologies for quoting shamelessly from City a.m. editor Allister Heath's column from the 17th January. He in turn is reporting on a recent McKinsey report about the contribution to economic growth of large multinationals to the US economy; 23% of UK private-sector direct value add, 34% of private-sector value add if you include indirect value to their supply chain; 31% of growth in GDP since 1990; 41% growth in labour productivity over the same time period; 75% of private R&D spending; 50% of US exports; 33% of US imports.

The IPA, in its dealings with UK Government, particularly BIS and DCMS, has emphasised repeatedly the importance to the marketing services sector of encouraging big multinationals to make the UK their European HQ or their hub to the world outside of their immediate continent.

Our reputation globally relies on originating and managing international campaigns from the UK on behalf of multinational brands.
That's why we share Allister's worry that 'there are too few world-beating giant multi-nationals being created in the UK; and many existing ones are relocating their HQs for tax purposes out of Britain. Both these trends must be reversed.'