The hurdles in the race for the new

Back in the heady days of 2020 when Twitter was a thing and the world was normal (checks notes), I found myself in the slightly novel position of tweeting in defence of the Welsh Government (I say 'slightly novel' inasmuch as the last time this happened, the news had been delivered not on Twitter but by the Town Crier).

The occasion was the loss of Britishvolt from its putative #Gigafactory site in St Athan in favour of (it turned out) Blyth in Northumberland. Criticism of Welsh Government for not being more accommodating to the project was pretty widespread - for example our much-missed (checks notes again) ex-Welsh Secretary, Alun Cairns suggested we had lost the second ever largest industrial project in UK history because the Welsh Government lacked the capacity, expertise, and interest to see it home.

“At the time Britishvolt were more financiers than developers." said Alun himself, and this was at the heart of why, from the day of its announcement I was publicly sceptical of its likelihood of happening (indeed As Ceri Davies points out, I only ever go back to Twitter now to say 'I told you so', which very much endears me to everyone there ??). A look at the company accounts at the time revealed a firm that had two directors, (IIRC) one employee, zero experience in either automotive or batteries (although plenty in, um, high-end watch sales), and no access to the innovative technology that might have explained why they were looking to make a splash in this sector.

Whilst from small acorns do mighty oaks grow, lamentably in the case of the shadiness of my modest garden, this never looked like the next Microsoft. Summer 2020 seems decades away now, but even three years ago the EV battery sector was pretty mature: cars had been on the road in good number for years, and the manufacturers had coalesced around a small number of highly capitalised Asian firms. Disruption would come from a big established firm like VAG (or an upstart Tesla) building its own European Gigafactory, but this was - as Musk is finding in Tesla's case in Berlin - a big ask. One too big of Britishvolt, especially in the middle of a pandemic and subsequent supply crunch.

For whatever reason then (and we don't really have the Welsh Government story) the changes to planning designations, infrastructure, grid and flood designation that would have enabled Britishvolt to build never, happened, and they went North (in the literal, then metaphorical sense). The episode leaves a number of questions around whether governmental capacity and expertise, alongside a clear and grounded strategy, exist to spur development in this sector, arguably critical for a foothold in an exploding market, not least in terms of rules-of-origin and EU market access. But those questions are directed now at the UK, rather than Welsh Government.

Let me be clear: firstly, I am pretty sceptical about the benefits, long-term of resource seeking FDI (so take this article in this vein), and secondly even getting into this game is difficult, let alone realising long-term benefits. Unlike some other governments, in the UK we must - or at least should - balance the likelihood of the success of a project (and its benefits) against its risks, to ensure the appropriate use of public funds - and indeed immensely valuable and productive* use of civil servants' time. Prior investments have brought huge benefits to Wales; Admiral and Sony come straight to mind. But piling, indiscriminating, into FDI has not worked for Wales over the last 40 years in terms of raising wider incomes or spurring new innovative ecosystems (though we keep our fingers crossed for CSConnected down in Newport). And this landscape is one where mobile capital holds almost all the cards in terms of capturing value; we live in the forever twilight of the triumph of the placeless.

Ah, the the triumph of the placeless, wait; the Triumph of the Placeless where spatially free firms, institutions and people can pick and choose where, when, and how to invest (then leave), shaping regions and cities to their own ends whilst ignoring the people embedded there. Where that bastion of a socialist superstate, the EU, requires free movement of capital and labour to make darn sure no multinational conglomerate is left behind, and where on the hills behind my house spin turbines that pour money into European firms (and governments), not local pockets. The cards are stacked, and to make local prosperity work we need sophisticated and choosy governments that are firstly, working for the long-term - preferably under legal duress - and secondly, that have with a clear-eyed, holistic and realistic approach to low carbon, nature friendly and inclusive development. Because if investment into growing markets (or indeed anywhere else) isn't for the long haul; isn't resilient; and doesn't improve our woeful levels of inequality, then what's it all about. Alfie.**

I will leave the reader to decide how close we are.

* yes I now work one day a week for Welsh Gov ????????

** no, not that Alfie