Chancellor opens book on more than £24 billion of Northern Powerhouse investment opportunities in China
Opportunities for Chinese investment into the Northern Powerhouse announced by the Chancellor.
The Chancellor of the Exchequer, George Osborne, showcased a selection of £24 billion worth of investment opportunities in the North of England at an event in Chengdu with senior Chinese investors, ahead of the upcoming State visit by President Xi in October.
Speaking in the city of Chengdu, the Chancellor said there are unprecedented opportunities for Chinese investment into the Northern Powerhouse as the UK and China enter a golden era of economic cooperation.
Infrastructure and regeneration investment projects such as the Atlantic Gateway – a series of projects connecting the Port of Liverpool to the City of Manchester; and Science Central, a cutting-edge development in the heart of Newcastle, are set out in a new Northern Pitchbook that was presented in Chengdu today.
At the same time, Britain’s great Northern leaders said a new wave of transformational Chinese investment can revolutionise Northern infrastructure.
The Chancellor was joined by a raft of Northern businesses looking to expand their work with China as well as civic leaders from the North including Leader of Cheshire East Council, Michael Jones, Mayor of Liverpool, Joe Anderson, Leader of Sheffield City Council, Julie Dore, Leader of Leeds City Council, Judith Blake, Leader of Manchester City Council, Sir Richard Leese, Leader of Trafford Council, Sean Anstee, and Leader of Newcastle City Council, Nick Forbes.
Chengdu provided the perfect location for today’s (24 September) announcements as the city, which is part of the Chongqing-Chengdu mega city cluster, and is an example of a region pooling its strengths successfully to ensure the whole is greater than the sum of its parts.
Key projects for which investment is sought include:
- Manchester Place: an opportunity to deliver three new zones of more than 10,000 homes with a combined value of over £3 billion
- Sheffield Retail Quarter: working with Sheffield City Council to create new city centre homes and centrally located offices
- South Bank, Leeds: an exciting new regeneration scheme covering more than 130 hectares in the city centre
Alongside the Pitchbook, the Chancellor also announced:
- potentially doubling Enterprise Zones across the North
- commissioning a new government report looking at existing links between UK and Chinese cities to help us better understand how we can attract more trade with China
- a commitment to reinvigorate partnerships between Northern and Chinese cities, including Sheffield’s Sister City agreement with Chengdu, which has fostered significant business, civic and cultural links since 2010
- the secondment of staff from the China Rail Construction Corporation, the world’s largest railway company, to Mott MacDonald, the UK based management, engineering and development consultancy, in Manchester
- the findings of a city-clusters research project based on the Chongqing-Chengdu cluster and the Northern Powerhouse
- a new service, established by Lancaster University, to bring together UK and Chinese universities, researchers and businesses to take research to commercialisation
- a new joint PhD programme to teach the next generation of Chinese Radio Astronomers at the Square Kilometre Array headquarters at Jodrell Bank
- a new offer on the Chevening Scholarship Programme to those in the Northern Powerhouse who wish to strengthen ties with Chinese students. Durham, Lancaster, Leeds, Liverpool, Manchester, Newcastle, Sheffield and York universities (the ‘N8’) have all expressed an interest so far
Chancellor George Osborne said:
As we continue to work more closely with China, we have an unprecedented opportunity to secure significant investment into some of our most ambitious projects across our Northern Powerhouse.
From Liverpool to Newcastle, we are opening up our doors to investment that will not only help us to grow and create jobs, but will allow us to build infrastructure to rival any region in the world.
The North of England is already a magnet for foreign investment into the country and we’ve seen with announcements from Nissan and Hitachi into the North East recently highlighting how perfectly poised our Northern Powerhouse is to attract the eye of global companies.
Commercial Secretary to the Treasury Lord O’Neill said:
Today is about making sure that the North is at the heart of our plans to grow investment into the country and we will be able to showcase compelling projects to ambitious Chinese investors.
But it is also about making sure we are cooperating and learning from China’s urbanisation experience, including the progress China has made in supporting and coordinating regional development and promoting the development of city clusters.
Communities Secretary Greg Clark said:
With over half a million businesses and seven of the world’s top 200 universities, the Northern Powerhouse has the potential to be a significant driving force of the whole UK economy.
Today’s Pitchbook sets out in black and white to Chinese investors over £24 billion worth of exciting investment opportunities, which together will deliver key infrastructure projects, help develop a highly skilled workforce and create thousands of jobs.
Chengdu is the fourth leg of the Chancellor’s tour of China and follows stops in Beijing, Shanghai and Xinjiang.
Leader of Trafford Council, Sean Anstee, said:
I am very pleased to have joined the Northern Powerhouse delegation this week in China.
We have demonstrated that the shared ambition of the North to work collectively with each other is a powerful force that resonates with our friends internationally.
Together we have committed to delivering the ambition of the Northern Powerhouse.
Leader of Leeds City Council, Judith Blake, said:
Visiting China with other Council leaders from across the North has enabled us to build on our existing strong relations with Leeds’ partner city of Hangzhou and to meet potential new partners for trade and investment.
Bringing investment into our major regeneration and transport schemes across the North will deliver a long overdue boost to the economy providing many much needed job opportunities.
Mayor of Liverpool, Joe Anderson, said:
Liverpool and China links are long established but this creates a new phase in supporting the whole North to grow.
Experience and partnerships with China can boost the Northern Powerhouse in developing infrastructure faster.
Leader of Sheffield City Council, Julie Dore said:
Connecting up the centres of our major cities has to be a priority.
And the opportunity for Chinese investment to help deliver our plans for new infrastructure must be seen as a basis for faster economic growth.
Leader of Manchester City Council, Sir Richard Leese, said:
The involvement of Beijing construction and engineering group at Airport City Manchester, and in a major development in the city centre, shows that there is an open door for Chinese business in the North.
There is now an enormous opportunity to work with us on the massive investment in infrastructure we expect to see over the next decade.
Leader of Newcastle City Council, Nick Forbes, said:
Newcastle and the North East, home of the original industrial revolution are integral to the rebuilding of our national manufacturing base.
As the only region in England that already has a balance of trade surplus we have even more potential to be realised.
I’m here in China with the Chancellor and other Northern Civic Leaders and businesses to present a united front for the investment opportunities we can offer.
Leader of Cheshire East Council, Michael Jones said:
The provision of funding from China can prove to be a game changer in releasing the value of land and infrastructure in the Northern Powerhouse.
Certainly in Cheshire, such funding and knowledge can re-energise our economy and residents.
- China’s contribution to world GDP has risen from below 2% in 1990, to almost 15% in 2014.
- Chinese GDP growth officially slowed to 7% in the first half of 2015. Many commentators believe that growth is really slower at close to 5%. However, even with slower GDP growth this year, China will represent around a quarter of global growth.
- China’s outward direct investment has tripled since 2005. And on current trends China will triple its stock of ODI by 2020 making it the world’s second largest (well behind the US) outward investor.
- The UK’s FDI stock of $11.8 billion in 2013 was the largest in Europe, more than France and Germany combined.
- China accounts for 3.6% of UK exports. China is the UK’s sixth biggest goods export market.
- Chinese equities accounts for less than 5% of household wealth.