ALEX BRUMMER: Sunak must play catch-up and show Britain means business

President Joe Biden’s fiscal enthusiasm, manifested in the Inflation Reduction Act (IRA) and the Chips and Science Act, is putting Britain on its heels.

Not only is the business lobby, the CBI, disintegrating, but Rishi Sunak and his Tory predecessors are also clueless about industrial policy.

Productivity is at a standstill. Industrialists and chipmakers are agonized. John Neill, the maker of British Leyland’s ashes motor component champion Unipart, warns his company’s next investment could be in the US.

Americans spend billions on the development of electric cars, green energy and semiconductors through loans and tax breaks.

Cambridge-based British chipmaker Pragmatic warns it could move abroad if the government fails to come up with a microprocessor strategy.

The start-up, which makes flexible circuit boards that can be embedded in everything from clothing to packaging, is the kind of high-tech venture the UK should be encouraging.

It is especially critical given the way Britain’s command and control over its high-tech future is being eviscerated by Arm Holdings’ decision to re-enter New York and Cambridge’s takeover of Cambridge industrial software company Aveva by the French Schneider.

Unipart’s Neill says he will wait for Brussels’ response to the IRA before taking action. Good luck with it, given the sclerotic and divided nature of decision-making in the EU. With the right political impetus, the UK should be able to move forward on its own.

Accelerating the pooling of local government pension funds, as proposed under the Edinburgh reforms, would raise up to £340bn, part of which could support an industrial/tech strategy.

The government’s ability to use leverage and loan guarantees through the British Business Bank, the UK Infrastructure Bank and the Export Credit Agency (unleashed to assist Rolls-Royce in Covid-19) could also play a role .

Activision Blizzard launched a flurry of abuse at Competition & Markets Authority after it blocked a £60 billion takeover by Microsoft.

The Call of Duty creator said it showed that “the UK is clearly closed for business.”

It was Britain’s attempt to demonstrate that it was open to trade, which initially resulted in the loss of Arm. Activision is right in identifying the directionless approach of industry and technology.

Investing is an agenda that Rishi Sunak, with his Stanford University background, should understand.

But he and Whitehall seem unable to meet the American challenge.

Life-enhancing

As a standalone pharma and vaccine group, GlaxoSmithKline is beginning to demonstrate its value to Britain and the world.

Strip out the disruptions of the pandemic and Q1 sales are up 10 percent in almost every category.

The concern is that the biggest lenders, for shingles and some HIV treatments, are running out of patent space.

In the past, GSK (with its asthma devices) has shown it can be creative in extending the life of its discoveries.

New stuff is on the way. Injectable HIV treatment, respiratory RSV vaccines and meningitis vaccines have potential — but whether there’s a blockbuster among them remains to be seen.

GSK boss Emma Walmsley has been on the takeover trail, recently acquiring Bellus Health for £1.6bn. She has also proven to be an effective voice in CBI disgrace and racism at Credit Suisse.

One of the pitfalls ahead is a California jury trial over purported but unproven links between stomach treatment and cancer

What GSK and UK life sciences need is swift approval by the drug regulator, the MHRA, for any new compounds and vaccines seen during the pandemic.

Win Bischoff

The death of Anglo-German financier Win Bischoff, 82, marks the passing of a big city grandee. I got to know him well in his role at investment banker Schroders.

He was immensely helpful when I assisted the late World Bank President Jim Wolfensohn, also at Schroders, in writing his biography.

Bischoff helped drive Lloyds Bank out of public ownership after the financial crisis, served as temporary chairman of Citigroup and traveled the world on behalf of JP Morgan.

His departure is a reminder of the values ​​of loyalty and trust that were once the hallmark of the Square Mile.