How Global Politics Are Reshaping UK Business Strategy. The Return of Industry?

I am not a geopolitician or a macroeconomics expert, but this short article will delve into those topics. Why? Because whether you like it or not, they will significantly impact your business and life very soon.

I was motivated to write this after meeting with Lord Maurice Glasman at the UK’s leading think tank, the Policy Exchange. Having visited Ukraine nine times in the past two years, Lord Glasman shared his insights with us at the Turnaround Management Association (TMA UK) event.

Stay with me until the end, as I will share the most provocative part last. I asked Baron Glasman, “What will it physically take for Britain to secure its interests in Ukraine?” His answer might shock the average person. Why do we need to secure our interests there in the first place? That’s another good question, which Mr. Glasman also addressed.

Let me start from the beginning. Over recent decades, we’ve believed we were transitioning to a globalised world where technology supersedes industry - a notion we’ve known mostly from history. And we could not have been more wrong. As Lord Glasman pointed out, the emergence of the new military and industrial power, aka China, has changed everything. At the same time we’re witnessing a significant political and economic upheaval within the EU, and with Russia’s invasion of Ukraine, it’s clear that the old order has been disrupted. China’s latest declaration of “no limits” cooperation with Russia only adds to the complexity.

So, why is Ukraine important to the UK’s future? There are several reasons. One is access to critical resources like Uranium and Lithium. Another is skilled manual labour, especially as countries like Poland, which previously filled this gap, are now heavily dependent on the EU, particularly Germany. The return to industry means a golden opportunity for the UK to reclaim its stature as a European and global power - just as Germany loses momentum and France remains indecisive.

With Donald Trump likely (in my opinion surely) returning as president, there’s a real possibility that American troops could withdraw from Europe to refocus on China. Europe lacks the capacity to counter Russia and its allies alone, and this is where the UK plans to step in. By the way, Brexit’s importance to some British elites is now becoming clear to me - it’s part of UK’s strategy to enhance its industrial capabilities.

According to Lord Glasman, we also need to massively invest in weapons manufacturing. A partnership with the new office under a potential Trump administration is strategically crucial for the UK’s Labour government. Unfortunately, this means less emphasis on the average person’s paycheque, our social care system, or NHS investments. Instead, building military and industrial capacity will become the UK’s priority, with the government underwriting private projects in these areas. Ow!

Returning to my earlier question, “What will it physically take to secure British interests in Ukraine?” And I asked Mr Maurice for direct and very honest answer. Lord Glasman’s straightforwardly answered: “pretty much everything, including military involvement there.” He predicts most of the funding will bolster our industrial and military capacity, starting from ￡7 bn per year, likely doubling soon. Thus, forget about other types of investments such as mentioned NHS etc. The middle class, and even the City of London, must shift focus from, e.g. financial derivatives, to investing in our industrial and military strength. This transition will take years, and as Baron Glasman emphasised, the conflict will not end soon but will likely escalate.

What does all this mean for our businesses? Our investments? Our lives? I’d love to hear your thoughts…

#Geopolitics #Macroeconomics #BusinessStrategy #InternationalBusiness #UKPolitics #InvestmentStrategy #Poland #Ukraine