Hart Brown - News article

25 June 2008

Economic Forum points to opportunities ahead

From front to back: Bettina Brueggemann, Managing Partner at Hart Brown solicitors; Mark Hoban, Shadow Minister for the Treasury; Dr Richard Roberts, Market Analysis Director and Chief Economist at Barclays UK Banking and Tim Price, Director of Investment at PFP Wealth Management.

The key message at the Fourth Annual Hart Brown Economic Forum held on 18 June was that despite a challenging economic outlook until at least mid 2009, there are opportunities for businesses and investors, if they are prepared to be proactive and flexible.

The Economic Forum at the University of Surrey was presented by Hart Brown solicitors in conjunction with UniS, Barclays Commercial and the South East England Development Agency (SEEDA).

Managing Partner of Hart Brown, Bettina Brueggemann, welcomed the speakers to the Forum saying, “This thought-provoking and stimulating event helps participants to assess the changes they need to make in running their businesses and continues to raise the profile of the high-quality professional services in the region.”

Guildford Mayor, Jennifer Jordan, Sir Paul Beresford, Conservative MP for Mole Valley and Anne Milton, MP for Guildford, as well as over 330 key players from the South East region’s business community heard that it will be the firms which use common sense, and make changes in good time to adapt to the demands of the marketplace, that will prosper in the difficult times ahead.

A timely economic assessment was provided by eminent speakers, experienced in the UK economy. They were Market Analysis Director and Chief Economist at Barclays UK Banking, Dr Richard Roberts; the Shadow Minister for the Treasury, Mark Hoban and Director of Investment at PFP Wealth Management, Tim Price.

In providing an outlook for late 2008 – 2010, Dr Richard Roberts said, “The credit crunch is not over yet but there are some signs of ‘the end of the beginning’ with a more orderly reorganisation of bank assets/liabilities and spreads beginning to narrow. There is some evidence that inflationary pressures will ease a little later this year but obviously the damage has already been done for this segment of the business cycle. Things are difficult and will get worse at the very least until mid 2009 in the housing market, construction and property; retail and consumer spending; Business to Consumer services and manufacturing. Whilst we are in a period of below-trend economic growth, the consensus view is that a recession will be avoided but it may not feel like it.”

Mark Hoban was critical of the Government’s failure to prepare the economy for difficult times. He said, “The time to fix the roof is when the sun is shining. Because of Gordon Brown’s mismanagement of public finances, the Government has been forced to increase taxes for businesses and families at a time when they need help not higher taxes. If Gordon Brown had prepared for a rainy day the economy would be in better shape. The changes I suggest are needed to bring about greater opportunities in our economy include a reform of the UK tax system; a framework to incentivise businesses to both invest in - and remain in - the UK; a focus on helping and improving our ailing manufacturing sector; the need to curb growth in public spending and better regulation and control of the financial services sector. At the moment we are very exposed because of our reliance on the financial services sector, which has grown enormously but is now taking the brunt of the credit crunch. We need to be less dependent on the success of any one sector in future. ”

Tim Price, Director of Investment for PFP Wealth Management, said, “Happily there IS opportunity amid the gloom, but investors will have to work that much harder to exploit it. I suspect that we will continue to see the rise of so-called alternative assets (notably hedge funds) as investors increasingly wake up to the fact that a ‘long-only’ approach to equity investment just doesn’t work in a bear market. I’m convinced that there is a way through the gloom, but it is most likely going to have to involve some more nuanced, out-of-the-box thinking versus traditional investing. The ongoing rise of Asian and emerging markets seems inevitable over the longer run. I’m also convinced that this is a positive backdrop to multi-asset investing which is less dependent on traditional assets like stocks and bonds. But investors are going to have to be more proactive.”

The speakers pointed to business opportunities in emerging markets like Brazil, Russia, India and China (the “BRIC” countries) and advised businesses to focus on providing high-value, quality brands and to look long term. The panel also spoke about opportunities in outsourcing and suggested that in future there will be more businesses outsourcing everything in the business chain but the idea and the brand.

Participants were able to put their questions to the speakers in a session hosted by Professor Neil Rickman, Head of Economics department at UniS.

Following this fourth, highly successful, event which is now pre-eminent in the Surrey business calendar, Hart Brown solicitors will be hosting the Fifth Annual Hart Brown Economic Forum on Wednesday 24 June 2009. It will be held at the same location with Giles Keating, Chair of Global Economics at Credit Suisse, as the keynote speaker. Dr Vince Cable will also be on the speakers’ panel.

To register your interest for the next Economic Forum in 2009, please email Hart Brown at virginia.cook@hartbrown.co.uk or call 01483 887766.