The doomsters and gloomadons of the left and at the London Assembly are continually bemoaning the billions of foreign investment flooding into London and the UK, mainly at the instigation of our Mayor, followed by government from various trade missions. To hear the lefties of the London Assembly talk, foreign investment is akin to having an hard drug or an alcohol problem, something to be regarded with horror, and avoided at all costs. Boris is “selling out” London. (The Mayor has shown huge enterprise in raising millions of funding for London, but never have I heard a word of approval from Assembly members.)
This naive view is contradicted by Allister Heath, editor of CityAM, who wrote that on the contrary, having an open market and being so attractive to foreign investors is what has saved the UK in the recession. British investors also invest abroad. Mr. Heath explains: “UK individuals, companies and institution own lots of foreign shares, companies and properties. We derive dividends and interest payments from those assets, bringing money back into the UK – and foreigners engage in the reverse process.”
Mr. Heath later says: “Wealthy foreigners are buying homes in Kensington; they are also shifting billions into UK companies, providing vital equity and debt financing and paying for investment.”
CityAM has made it clear how damaging they believe the economically illiterate actions of Ed Miliband, and certainly a Labour Mayor would be to the UK and the capital. Share prices slumped for example, after Ed’s “absurd promise to cap energy prices”, losing investors a fortune. The CBI and other financial City Editors back Mr. Heath’s opinion.
During one session of Mayor’s Question Time, a Labour Assembly member berated the Mayor for paying off a City Hall loan early to save interest. With respect, it really would benefit London if Labour Assembly members could get up to speed on economics, or at least admit, that talented though they are in other directions, understanding finance is not their forte.