Is this possible for the UK Economy?

[multre413]

The UK is the 6th largest economy in the world (soon to be 5th when it surpasses Japan in 2030).

Greater London and the South-East of England are the most productive and some of the most wealthy regions in all of Europe with London having, by far, the largest GDP of any European city.

Despite this, the rest of the UK is very deprived, with the UK having more regions in the 10 most deprived regions in Western Europe than any other Western European nation. everywhere besides London and the South-East, but especially Northern England, Wales and Northern Ireland are very poor and unproductive.

This got me thinking.

Isn't this a good thing?

By this I mean, doesn't this show the UK has great potential?

Like if the rest of the country was simply brought up to London levels of GDP per Capita and productivity through genuine 'levelling up' and investment, then the UK could have a GDP per Capita higher than the USA or Ireland (as was the case pre-2008).

And, if this happened, then the UK economy would be almost 2.5x the size it is now so larger than Germany and France combined!

To me this sounds more optimistic than if someone said the UK is stuck where it is because we've 'levelled up' as much as we can and cannot do anymore since we are at the limit, but if we can have London and the SE so rich and productive, why can't we simply do this to the entire country or as much of it as possible? Like make Manchester, Belfast, Glasgow, Birmingham, Newcastle etc as productive or even more than London.

Again, through genuine investment and genuine 'levelling up'.

Please can someone explain if this is realistic or not and if this worked then the UK would have a higher GDP per Capita than USA or Ireland (not impossible since if they can have such high GDP per Capita and we used to have a higher one, why can't we do it again): and if this could translate into having a larger economy than Germany and France put together and being number three in the world after USA and China?

And, when I say, whether this is realistic or not, I'm not asking you to say whether the current crop of politicians/current government is too corrupt or incompetent or lazy to do it; but whether if we had a truly good government we could do it.

I mean I can imagine it all: Northern England and Northern Ireland as well as parts of Scotland become industrial hubs again; the Midlands and other parts of Scotland become manufacturing hubs; London and the SE focus on financial services and tech while some other major cities like Manchester and Edinburgh also focus on financial services and tech; the East of England/Oxford-Cambridge Corridor can be a scientific/technological hub like Silicon Valley (which is actually something that has been proposed); Wales can be a mixture of everything: agricultural, financial, technological, manufacturing; and the SW of England can be agricultural and financial with Bristol.

I know it's easier said than done, but is this possible?

It is a nice dream. And I am sure it is possible in some universe, after all, China has pulled itself up by its bootstraps.

I think the biggest obstacle we have is ourselves. there is a lot of division and we are all pulling in different directions.

For example - we need a lot more energy/electricity to realise what you propose. Triple, quadrouple, or more times as much generation and quickly. Where is it going to come from and will everyone agree with the mix of sources chosen (nuclear, gas, solar, hydro, wind and even coal?) they are all disruptive in their own way and there is no way we could get away with just one or two.

We would need a well educated workforce too, that is another bear pit of a debate.....

No one asks themselves the question: "I don't like it, but could I live with it to get to there?"

If we all asked it then maybe we could achieve it

The problem with manufacturing is that China does so much of it better, faster and far cheaper. For example Newcastle was built on coal and shipbuilding. For obvious reasons coal is out. Shipbuilding can no longer compete in any way on the Tyne no matter how much we invest or support the industry. I can't remember the stats but China can build vast supertankers extremely quickly, something there isn't even the space for to do in Newcastle. Korea builds better ships. The rest of the world has taken over.

We are good at services. Which unfortunately will be taken over by AI. And net zero is going to rule out industries that need power so we won't be able to cash in on the development of AI anyway.

Theres plenty of driven, clever, inventive people in the UK. We just need a government that doesn't try and wreck everything for ideaological reasons (Labour) or incompetence (Conservatives).

Are you familiar with Kevin Walmsley; inside China business?
He has a few videos about ship building capacity, the general impression is that China is now unassailable in most sectors. Why? All kinds of reasons but probably the ability to plan for longer than 4-5 years and the CPC has access to all the levers of the economy. Unlike our PMs eg Liz Truss.

China are going full steam ahead with renewables, solar on every (massive) factory roof, every inch of wasted ground at every motorway junction, wind turbines everywhere and gas turbines.

https://kdwalmsley.substack.com/

I will have a look at that. It looks interesting (and scary).
I also understand one issue is the size of the dry docks which the Tyne cannot have anywhere. Whereas China can just build them as needed. They dwarf anything we can come up with. It's a great shame.

I do think having continuous changes to government disrupts the ability to plan long term. I see it working in govt all the time, with constant policy changes so you can’t build up any momentum. Not saying that I want a totalitarian regime but it doesn’t help.

That's very true. I recently read that the reason Norway's energy industry is so successful is that there is an assumption that governments (no matter the stripe) won't interfere in that sector. So businesses can just crack on and spend money on investment and innovation. Which has led to the techniques that have now meant more oil can be extracted. Oil that is probably also in our part of the North Sea too...

Like if the rest of the country was simply brought up to London levels of GDP per Capita and productivity through genuine 'levelling up' and investment
The rest of the country levelling up or the S.E. levelling down?
London and the SE do so well because they suck the lifeblood out of the rest of the country. People have been moving to the place where the streets are lined with gold since the days of Dick Whittington but the effect has accelerated in the last half century.
When I first started work, back in the 70s, there were several large companies head-quartered in the West Midlands. They are all mostly HQ'd in London now so, of course, people chase the money. And the West Midlands is seen as an underperforming wasteland. Thanks for that.

I suppose the tide will turn one day. Labourers left the countryside to work in the cities during the industrial revolution. Their successors left provincial cities to work in services in the S.E. At some stage, it may be the S.E's turn to be the dying-work-sector but currently they are quite canny at making sure that investment stays in the S.E (one of many examples: HS2).

Rest of the country levelling up to London and SE while they stay just as rich as they are now or even more.

Norway owns all the oil and gas produced in its seas. Through a state owned corporation - Statoil. The government doesn't have to interfere in it as they own the lot. Britain used to have something similar , BNOC. Mrs Thatcher sold it all off. So Norway has a huge Sovereign Wealth Fund which pays for pensions and welfare etc.

As for the fabulous wealth of London, well where is it ...or rather who owns it? Here in Ireland we often hear about how rich we are - allegedly. But it's all ' transfer pricing ' and various tax wheezes for multi nationals. Britain might jump start industry through rearmament though? It's a scary world now and you can't rely on the mad king across the water ....

What a disaster that would be for the environment.

But London is propped up by/ made by banking. That's what skews these GDP figures. We can't just invent banks everywhere else. If you stripped out the banks/financial services side of things what would London look like?

I completely agree more emphasis needed to genuinely level up, but the rest of the UK will realistically never match London.

The UK (nations & regions) is a very poor country latched to a hugely wealthy square mile.
I'm from the Midlands & once industry failed, its been a slide towards economic wasteland.
I'm not sure what the solution is - we seem to be in an awful spiral. Our politicians, of all stripes, seem stumped & cathederal thinking evades them all.
We're not well educated enough, god help us if China ever tells its educated young they're free to apply for work & live wherever they choose.
I feel desperately sorry for young people right now.

I'm aware of Norway's set up. My point was that it is agreed that no matter what type of government they don't interfere in the oil sector. Even if there was a very "green" government. This allows for innovation as the oil sector can plan long term.

Unlike here where Labour have effectively shut our oil industry down. It will be very hard to restart if government policy changes. Which it will have to.

Have you travelled around the UK? I’m in a large village/small town, we’re only an hour from London by train, but it’s a different planet really, buses are expensive and infrequent, and get more expensive/less frequent each year, getting to London is really expensive, always overcrowded. Local schools perform below national averages, far below London schools, and get far less funding. It’s cheaper, but it’s nothing like London, although we benefit a little from being quite close. Nowhere in our local town is very very poor and we have low unemployment. Parts of the UK are very much poorer with little infrastructure.

We have a huge inequality problem in the UK and we’d have to completely change how we do things to level up. Politicians will talk about it but really London needs quite a lot of investment to maintain its position and there’s not enough left over to bring the rest of the UK up.

@multre413 see? Hardly any replies but this person has already vetoed the notion. They didn’t ask “what can I live with?”
We’re fucked