When the 2022 Commonwealth Games opens in Birmingham’s refurbished Alexander Stadium on the 28th of July, this showpiece event has the potential to act as a catalyst for a reinvigoration of the West Midlands economy, building towards 2032 when the inaugural HS2 trains are due to arrive at the city’s Curzon Street station – a future landmark that will become the first brand new intercity rail terminus to have been built in Britain since the 19th century. The most exciting thing about the future is that it is yet to be written, and is ours, collectively, to shape. The decade ahead for the West Midlands will be neatly bookended by these two significant events, with both bringing significant infrastructure benefits that will be felt more in the region than elsewhere in the country (an example of levelling up in action?). However, it should not be lost on us that, as the past couple of years has well illustrated, nothing in life is guaranteed. In an increasingly competitive world, it is essential that the region as a whole grasps this positive hand we have fought hard to be dealt, and strains every sinew to ensure that maximum value is wrung from these events and all the activity that will happen in between.
The most exciting thing about the future is that it is yet to be written, and is ours, collectively, to shape. The decade ahead for the West Midlands will be neatly bookended by these two significant events, with both bringing significant infrastructure benefits that will be felt more in the region than elsewhere in the country (an example of levelling up in action?). However, it should not be lost on us that, as the past couple of years has well illustrated, nothing in life is guaranteed.
In an increasingly competitive world, it is essential that the region as a whole grasps this positive hand we have fought hard to be dealt, and strains every sinew to ensure that maximum value is wrung from these events and all the activity that will happen in between.
Over and above the Games and HS2 we also have many other factors in our favour, not least a geographical position at the heart of the country coupled with global connectivity through the hub and spoke model operated by the likes of Emirates, Qatar and Turkish Airlines flying out of Birmingham International airport. If the region was looking for a motto that could define our approach to the upcoming decade, then one might suggest ‘Carpe Diem’.
The ingredients are all there for the West Midlands, but if we do not collectively make the most of this moment then one can be certain that other locations around the world will be pushing hard to make the most of their own particular circumstances, and to seize some of the benefits that otherwise could be captured here.
As we emerge from two years that have been shaped by Covid-19, hosting the Games in 2022 presents a unique opportunity that can stimulate renewed post-pandemic economic growth across the West Midlands, as well as allowing the region to, ‘reboot’ its image on a global stage.
Although it might be ‘Birmingham’ in the title, with swimming in Sandwell, cycling in Cannock and lawn bowls in Leamington, as well as beach volleyball in Birmingham, the Games presents the entire area with an unprecedented marketing opportunity to put itself back ‘on the map’ and showcase all that is great about the area to a worldwide audience, as well as hopefully shattering a few outdated and negative preconceptions that sadly still exist in some other parts of the UK.
By the time the first race is run over £750 million of public money will have been invested in a host of local infrastructure around the Games and more than 1 million tickets will have been sold to people who will visit and travel across the region to attend the events in person. Over the duration of the Games the global TV audience will be over 1.5 billion, as people tune in to watch the sporting action taking place all over the West Midlands. The scale is truly impressive, and there are very few events that can deliver such reach and coverage for a region over the prolonged period of the Games duration.
Hopefully, the Games will also leave an important legacy in helping to tackle some of the domestic challenges and inequalities that must be addressed throughout the region if we are to fulfil our economic potential in the years ahead. From a skills gap and shortages through to being far better at harnessing the wonderful diversity that exists in the West Midlands, there is much to be done to improve income inequality and access to opportunities for all. The fact that over 40,000 local volunteers have already put themselves forward to support activities around the Games is a good example of the potential the event has to deliver some lasting benefits within the community, and it is to be hoped that programmes such as that around volunteers can be capitalised on in order to leave a tangible legacy that can improve lives and make an additional contribution to regional economic growth.
Looking further from home, and on a more macro level, if the West Midlands is to really enjoy a decade to remember for the right reasons, building on the unique and catalytic opportunity that the Games present, then one might also suggest that we need to be fully aware of the big international economic trends that are currently taking place. These will shape the world for years to come, and so we should ensure that our businesses are prepared and ready to take advantage of the trading opportunities these shifts will present on the world stage. The Games may provide the watching world with pictures of a modern, diverse and dynamic West Midlands, but this must be a two-way exchange of knowledge and insight, and, as a region, we should push to ensure we are as outward looking in all we do as possible.
One such trend to highlight and be aware of is the advent of what is increasingly being described as the ‘Asian Century’. By 2030 Asia will be home to 65% of the world’s 5.4 billion middle class consumers. Ten years later, in 2040, McKinsey research estimates that Asia will be generating at least 50% of the world’s GDP, with the shifts in terms of an increasing Asian global share of trade, capital, people, knowledge, transport and resources already well under way.
Our family business has been active in Asia-Pacific for a number of years, with investments in Australia, New Zealand, Singapore and the west coast of Canada (as well as having physical representation in the latter two), and we have been observing and following the developments in the region with particular interest, not least how it is proactively positioning itself to ensure that the projected growth does indeed occur.
While it attracted little coverage in the UK, the turn of the year saw the ‘Regional Comprehensive Economic Partnership’ (RCEP) take effect, having been nearly a decade in the making. The RCEP immediately becomes the largest trading bloc in history, surpassing the EU and NAFTA, with its 15 member signatories, including China, Japan, Indonesia, South Korea and Australia, making up close to 30% of the world’s population and global GDP.
With apologies for the alphabet soup, the RCEP now sits alongside the CPTPP (Comprehensive and Progressive Trans-Pacific Partnership), as an Asia-Pacific focused trading framework, designed to stimulate further growth in regional economies. CPTPP came into force at the end of 2018 with 11 member countries, and even without the present participation of the US, whose engagement was ended by President Trump, its signatories collectively represent close to 15% of global GDP.
There are similarities (seven countries are members of both) and differences between these two partnerships that will be debated elsewhere, not least around the strength and subsequent real value of their commitments, but their development is most interesting as a clear sign of the trading developments taking place around the Pacific.
From a UK perspective this takes on additional significance as a result of the country’s ‘tilt’ to the Indo-Pacific region that was outlined in last year’s foreign and defence policy review, highlighted by the formal application that was made for the UK to join the CPTPP in February. Nothing seems to move quickly with trade agreements, and that process is expected to continue throughout 2022, but it has been impressive to watch the Department for International Trade line up a number of Free Trade Agreements with CPTPP members including Japan, Australia and New Zealand in recent months which contain language that will certainly make the accession process more straightforward.
With 6 of the 11 CPTPP members also part of the Commonwealth, is it too much of a stretch to imagine the Games in summer 2022 providing a convenient backdrop and global audience to witness the UK’s formal entry into the CPTPP being signed-off in Birmingham?
Regardless, it seems certain that the UK will join the CPTPP at some point in 2022, and so it, and the opportunities that membership will present, deserve due attention and would seem like a welcome chance for businesses in the West Midlands to steal a march on the competition and build on the boost the region will receive from the Commonwealth Games.
Balancing a focus on domestic and overseas opportunities certainly should not be a matter of either/or for business. From the perspective of our own business, we are proud of our Black Country heritage and recent investments such as the £160m West Midlands Designer Outlet Village that opened last April and has already created over 1,000 new jobs in the region. Yet at the same time the Richardson family continue to actively invest internationally, completing deals in Australia, Canada, Singapore and the US amongst others in the past 12 months.
There is no doubt that overseas opportunities are out there for businesses and equally that the West Midlands is incredibly well placed at the start of 2022 for a period of sustained economic growth. Our business has always been entrepreneurial at its core since it was founded in the first half of the twentieth century, and that brings with it a certain degree of in-built optimism around the future, together with a fierce desire to make things happen. While we regard that as a positive, it also reinforces the belief that we cannot simply sit back and expect good things to happen, something which is true for any business, and certainly for the West Midlands region as we look out ahead over the next decade.
Dubai is currently halfway through hosting the six-month long World Expo, where 192 countries are represented in an incredibly impressive and immersive experience, with the stated goal of being the ‘greatest showcase of human brilliance and achievement’. Over the course of a visit one can feel as though you have had toured the entire world, from Afghanistan to Zimbabwe, and come away with a sense of how each nation is looking to the future and what they have to offer those seeking to make business happen.
Set against this showcase of ambition in the Middle East, a recent article in The Guardian about the build up to the Commonwealth Games highlighted the fact that organisers were expecting ‘at least’ 90% of spectators to be from the UK. While, that figure struck me as certainly less than ideal in terms of making the most of the Games to showcase the best of the West Midlands to the rest of the world in person.
I mention these examples simply to emphasise the point that in the global race, and even with many factors in our favour, we cannot afford to rest on our laurels, as success and future prosperity are by no means a given. Rather, we should take inspiration from the region’s industrial past, when the West Midlands was known as the ‘workshop of the world’ and was shaping how the planet evolved during the 19th century Industrial Revolution, and couple that with ambition and a commitment to hard work in order to ensure that our optimism in looking at the years ahead is fully realised.
The ingredients are certainly in place for the West Midlands to enjoy a golden decade, but, like the athletes competing at the Commonwealth Games, success will only come if we constantly challenge ourselves to perform to the very best of our abilities.