Aversion to Risk Is Holding Britain Back, Wealth Fund Chief Says

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(Bloomberg) – Britain is facing a problem with risk – the country does not take enough of it.

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This is the view of John Flint, the former CEO of HSBC Holdings PLC, responsible for the National Fund for National Resources of the Labor Party. He says that the organizers are very arrogant, and financial institutions are very cautious and a highly shy society. The result can be seen in the global economic performance in the UK over the past few years.

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“The growth results here are fully consistent with our risks,” Flint said in an interview with Bloomberg. “So I don't think we should be surprised that we are not growing. We do not bear enough risks to growth.”

The slow economy in Britain, which has witnessed a slower growth in productivity than our American and European peers in the past and a half, is proposed as a sharp crisis. Under the financial regulations that were set after the 2008 crisis, banks must carry large capital stores that can only be issued when the times become difficult. Flynt hinted that it should be relaxed, providing billions of pounds of fireworks to lend to stimulate activity and withdraw the UK from the low growth trap.

He said that the organizational “pendulum” had swinging “very far away.” “The banking system is in good condition. If mature democracy and aging strikes financial temporary stores and do not grow – this is a form of crisis. I do not think that there is any point in the presence of large stores in absorbing the loss unless it is used.”

Flint's comments are in harmony with the work government's plans to reduce the regulations to increase investment in vital business. Prime Minister Kiir Starmer promised to simplify planning to build more homes and infrastructure. Treasury Advisor Rachel Reeves pushes the financial organizers to relax hard rules and business minister Jonathan Reynolds suggested the regulatory authorities to integrate the red strip. The heads of both competition and markets and the service of the Secretary of the Financial Grievances left the audit.

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The background to the grammatical batch of the Labor Party is the turbulent growth, which has stopped since the party won the elections last July. Her dark warnings after reaching power and the great tax height of business in the budget in October may darken the mood. The United Kingdom may outperform their European peers such as Germany, France and Italy – but growth has decreased since the last partisan government between 1997 and 2010. The GDP has grown for each head only in four of the past 12 quarter, and the private sector has returned in recession, with public spending now Do all heavy lifting.

Work is desperate to change this path, and it targets an ambition of 2.5 %, because its plans to repair public services and raise home living levels require rapid economic expansion.

Reeves is already facing the consequences of slow output. Earlier this month, the Budget Responsibility Office scanned 9.9 billion pounds ($ 12.5 billion) from the Hall of the head for its financial bases after cutting growth in the first five expectations before the financial event on March 26.

Public services such as justice and police are now facing the possibility of an increase in austerity, as budgets are reduced to fill the opening. The departments were informed of spending to freeze them according to the main review that was planned in June.

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Climate

Reeves hopes that Flint will be part of the solution. It was appointed in 2021 by another governorate government to lead the newly created UK Infrastructure Bank, which was created to replace the European Investment Bank after Britain's exit from the European Union and providing development financing for green and industrial projects.

Reeves returned the NWF brand last year and gave it a more specific green agenda. The power of fire also strengthened 5.8 billion pounds to 27.8 billion pounds, although this was less than 1.5 billion pounds from the first planned.

Flint stressed that the name is misleading. He said that it is not a sovereign wealth fund like a $ 1.8 trillion investment management, as it “publishes great surpluses.” “We are publishing public funds and we do this on behalf of a government that has financial restrictions, and therefore the comparison does not reach a large extent.”

His mission is to invest in projects that will not be launched from land like HighView Power, a renewable energy sources company that presses AIR to store energy such as a giant battery. NWF provides the foundation stone financing or risk absorption guarantees and make projects viable for investors. But often he says that the private sector, despite its general obligations to remove carbon, wants the state to do hard work.

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He said: “The government is, to a large extent, the social communication of the cost of climate transition and the private sector is very selective about the role it plays.” “We publish money on their behalf, and the funding rulers enjoy low risk and better returns. The risks that we prefer not to be in the public budget for the public sector.”

He said: If banks and asset managers are less dangerous, “we may be able to accelerate climate transmission.” He says that the risk alienation is not only within bank management, but among the shareholders who hesitate to seize the opportunity to obtain better financial and social rewards. Banks and investors, for their part, consider that the risk sharing is vital given what is often tested.

Flint says he now sees that the risk contradicts almost everywhere. “The United Kingdom is a society that hates very risks now,” he said. “We do not like not compliance. We don't like mistakes. We don't like anything wrong, and when we have a great habit in analysis and trying to make sure that there are no things. But this appetite for risks has its consequences, and low levels of growth and innovation can be part of it.”

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The Governor of Bank of England Andrew Billy hit a more cautious tone, and warned against forgetting the lessons of the financial crisis. He said on Tuesday: “It is wise to avoid the idea that the organization is the best solution to any problem, but let's not fall into the opposite idea that it is always a available option.”

With his comments, Flint joins a choir of bankers and former organizers. Andy Haldan, the former chief economist of the Bank of England and the CEO of the Royal Arts Association, admitted last year as “his hand in creating organizational monsters” “that had a collective as a result of the appetite for the risk of kidnapping and similar investment.” Jonathan Hill, who was previously delegated in the European Union’s finance, believes that growth has been sufficient through the size of logic in the regulatory state.

The argument gathered the momentum, not the least of which is that US President Donald Trump is taking a burning land approach to the organization that threatens to leave other countries that are not competitive worldwide. The European Union responded with plans to facilitate commercial business and made Reeves a focus in its speech on growth last month.

Flint said he is confident that a new approach could work well in Britain because the UK has “the best wise organizer in the world” and a clear industrial plan from the Labor Party.

“On a relative basis, the British economy looks good now,” he added. It will take some time for politics in the United States “to settle investors to find out exactly what will be the new rules. The main economies in Europe have faced their own challenges.”

He says the balance of risk is properly, and the United Kingdom “can do more.”

– With the help of Catherine Griffiths and Harry Wilson.

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