Tech sector set to boost UK economy by £200bn if government supports new industry
BRITAIN’S tech sector could boost the economy by £200billion by the end of the decade — but industry bosses say they need more government support.
The UK already has the world’s third largest tech industry, behind China and the US.
But there are growing concerns that the country will swiftly lose ground unless rapidly developing technologies are supported.
A report by techUK said that “we have fallen off the pace and UK policy makers and politicians have developed a bad habit of patting themselves on the back for the UK’s successes in one area, while failing to recognise our weaknesses in another”.
The industry body is to highlight 18 examples of how technology can benefit public services and drive economic growth.
It has called for changes to the apprenticeship levy so companies can use it to retrain employees in digital skills.
It comes amid warnings that seven million workers — around 20 per cent of the total UK workforce — will be underskilled as technology evolves.
PM Rishi Sunak has ambitions to to replicate Silicon Valley by fostering more technology firms with valuations of more than $1billion.
He referred to his hopes for the UK to be known as “Unicorn Kingdom”.
Julian David, boss of techUK, said: “We need politicians to act, set out a long-term plan for the sector, provide a better approach to regulation and deliver on strategies for key technologies.”
TechUK’s report highlights that in the UK tech companies find it more difficult to raise money from investors than international rivals — while the London Stock Exchange undervalues tech businesses in comparison to New York rivals.
ASOS SPIRIT RISE
SHARES in Asos rose 15 per cent yesterday following weekend reports of a £1billion takeover approach.
The offer from Turkey’s Trendyol valued the online fashion retailer at between £10 and £12-a-share — double the trading price and about three times its current value.
Although the bid interest is not active, investors hope it will flush out further interest.
Shares in Asos, owner of Topshop, fell 75 per cent in the last year. It had to secure a high-interest loan to shore up its balance sheet.
CBI FACES RIVAL ON VOTE DAY
THE British Chambers of Commerce has launched a rival business council on the eve of a crunch vote on the future of the CBI.
The CBI will face its members at noon today for a confidence vote on whether its members will back its future after a string of sexual misconduct allegations.
Big organisations including Aviva and Natwest have cancelled their memberships and the CBI has engaged insolvency experts to advise what happens next if it loses the vote.
The CBI is funded entirely by its members.
The BCC said yesterday that its was offering a “different kind of representation” and its new council already had the backing of BP, IHG and Drax, Heathrow.
But CBI director general Rain Newton-Smith said yesterday: “I’m confident and determined this will be a turning point for us. The start of a new chapter, for a renewed CBI.”
DIAGEO CEO OFF
THE boss of drinks maker Diageo has stepped down a month early after a “significant setback” following surgery on a stomach ulcer.
Sir Ivan Menezes, 63, had spent a decade in charge.
Debra Crew, 52, an ex-US military intelligence officer, takes over. She will be the ninth female CEO at a FTSE 100 firm.
Diageo said: “Over the weekend, we learned that Ivan’s recovery suffered a significant setback. Our thoughts are with our much-loved colleague and his family.”
OIL PRICES RISE AS OUTPUT CUT
THE price of oil jumped yesterday after Saudi Arabia said it would cut production by a million barrels a day in July.
The Gulf state decided to reduce output from 10million to nine million barrels a day after the Opec oil cartel failed to agree on how much to cut production by.
Oil prices have fallen over the past year on global recession fears after peaking at $125 a barrel.
Yesterday they rose by 1.3 per cent to $77.17.
Higher oil costs usually hit motorists, but it is hoped pump prices won’t need to soar again as lower wholesale prices are still to feed through.
WOT’S-IT AT HOME
SNACK giant Pepsico is investing £58million in its Leicester factory to bring the manufacturing of Wotsits and Monster Munch home to the UK from Europe.
PepsiCo said the investment will help boost production capacity and see its Wotsits Giants, right, and Monster Munch Giants crisps made in Britain from next year.
The company said the move will also help to address its green-targets by cutting transport emissions.
It comes as Walkers crisps, promoted by Gary Lineker, celebrates its 75th anniversary.
Jason Richards, boss at PepsiCo UK and Ireland, said: “There’s no better time to renew our commitment to Leicester — a city crucial to our UK success.”
DEAL OFF ON PAPER
London-listed packaging and paper group Mondi has scrapped plans to sell its largest Russian plant due to a “lack of progress” getting approvals.
In August, Mondi announced the £1.36billion sale of its biggest paper mill in Russia to an investment vehicle headed by a Russian billionaire, Viktor Kharitonin — but that deal is now off.
Putin has put pressure on Western companies leaving Russia to sell up to local investors or pay “exit” penalties.