UK Economy: Moving in the Right Direction?
Between 2007 and 2012 Macau’s casino sector has produced a compound annual growth rate of 53%. This largely reflects the Chinese appetite to gamble legally and the strength of the Chinese economy. Economists in Hong Kong watch the Macau numbers closely because they say it is a pointer to how China’s GDP is growing.
In January I wrote to all my gambling industry colleagues to ask a simple question:
Do you think the UK Government economic policy is moving in the right direction?
Looking at the performance of casinos in Europe and elsewhere we see that the recession as you would expect has hit some markets very hard.
“Yes, but government spending on non-investment items still needs to come way down”
“Yes reducing debt and spending key, no because they are not driving or incentivizing growth”
“YES but not really that simple, as I am sure you know! Not fast enough and not getting rid of bad, lazy management creating paperwork though!”
“No they have not got a clue”
“Hard to be an optimist, but harder to say what the chancellor should be doing”
“Can I say it’s moving in the wrong direction but a lot slower than it could be moving….?!”
“The Govt is over focussed on Fiscal Consolidation for political gain. The end result is lack of targeted investment and no encouragement for growth and jobs.”
60% said they thought UK Government policy was moving in the right direction and 40% disagreed.
If I had to come down either way it would be a mild YES. When I travel I do not see the same problems in UK that I have seen elsewhere in Europe. I notice people coming to UK from Spain, Greece and Italy looking for work. The economy has been kept on the rails. But the debt burden is a worry and we have an expensive welfare state that we can no longer afford.
I think the best quote from the World Economic Forum in Davos this year came from Andy Harrison, the CEO of Whitbread Plc. He said that his company’s business model was based on the current economic climate continuing for ten years and that those companies whose business model depends on an upturn will fail.