Glad to see that Neelie Kroes has been taking time out to talk to the private sector movers & shakers about “the broadband investment challenge”. Her CEO Roundtable last week certainly boasted an impressive line-up of industry representation, and I’ve no doubt that the planned follow-on meeting (in mid-July) will help to develop the “holistic approach” the EU Commissioner says she’s looking for.
Thinking about the meaning of that word ‘holistic’, I was planning to launch a sermon on the need for the EU – and other regulators – to consider their own role in overcoming our current investment hurdles. But then I saw TV coverage of David Cameron speaking at his ‘Enterprise Summit’ in the Midlands, calling for a ‘rebalancing’ of the UK economy towards long-term, export-led industry investment, and I was struck by the parallels between these two consultation exercises.
In the past, a few, relatively simple adjustments to government or regulatory policy instruments have been able to summon up some limited forms of investment – whether it’s been the development of retail and service-led competition in the communications sector or the creation of public sector jobs in former industrial zones. Sadly, those at the helm seem to think that the creation of a different, more sustainable investment model is simply a matter of plotting a new course.
In reality, there are very few levers available to the EU – or the coalition government – in their quest to promote competitive investment in infrastructure (or productive capacity). Indeed, if the authorities only acknowledged their limitations in this context, we might have avoided some of the unhelpful initiatives and interventions of the past. Because a key attribute of this kind of investment is its reliance on long-term payback – over 20 years in many cases. So, even if they can help create the right ‘climate for investment’, one of the essential skills required of regulators is patience.
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