egular readers of my columns in Infrastructure Intelligence will know that around this time last year I predicted 2017 to be a year of turbulence for the industry and identified five key issues for the sector in the months ahead.
Well, one unexpected general election and hung parliament later, it is hard not to view 2017 as anything other than turbulent! Meanwhile the five key factors I highlighted - the Chinese economy, oil and gas, technology, market consolidation and our political situation -have not gone away and, if anything, loom even larger for our sector, and the UK more widely, as we enter 2018.
However, there is one issue which seems to have dominated discourse for the media, politicians and businessmen alike, Brexit.
While we may be slightly clearer on the UK’s negotiating position, we’re still no closer on predicting an outcome, nor indeed whether the prime minister’s fragile position, with a divided cabinet and a parliament in balance, will last. No doubt the political discussions in 2018 will focus on issues like the length of any transitional deal, whether we will continue to have free access to an open European market and longer-term trade treaties with other countries. All of which will be crucial for our members who make up an industry that is truly global in its outlook.
Last year saw a busy market in the UK. We witnessed further market consolidation and I predict additional structural changes in 2018. This will create opportunities for an injection of new thinking beyond 2018 and post-Brexit.
Nevertheless, in the near term, Brexit’s ripple effects may well be felt by our sector as the general macro-economic slowdown potentially filters through to a weakening in demand for our services. Meanwhile any further currency devaluation would mean our companies offer even better value for money to foreign investors.
However, one issue that strikes me in many of my conversations on Brexit is how many say: “It will all be OK in the end.” While I share their optimism that we will eventually find a solution that is acceptable to both the electorate in the UK and the EU nations, I worry that the continued focus on Brexit is impacting the “day-to-day” work of government. It is for this reason that ACE will continue to engage on behalf of its members, making sure that infrastructure is not set aside to be discussed at an undisclosed date in the future and that the important work continues on delivering our national project pipeline.
In the face of this continued uncertainty, combined with the recent resignation of Lord Andrew Adonis as the chairman of National Infrastructure Commission, we need to make sure we’re speaking in a unified voice to grasp the opportunities that are presented to us.
We need to be engaging as one with the government to leverage the construction sector deal, for example. Furthermore, we should be making the most of new opportunities for engagement with the metro-mayors, growth corridors and regional cities of England, especially in the Midlands and north west. Finally, we should be coming together on the major issues facing our industry, such as the skills gap and new technology.
As part of this process, I oversaw a restructuring of ACE last year to ensure we continue to be fit for our members’ needs and agile enough to respond to this ever-changing landscape. ACE now has a strong and capable team who will be better connected with our members and deliver sharper engagement at every level. Thanks to these changes fully supported by the ACE board, I am certain ACE will become an even stronger voice for the numerous shared interests of our members in the years ahead.
This opinion piece originally appeared in Infrastructure Intelligence.