Duncan Wheldon at the TUC points out something:
David Cameron has arranged for a state-backed lender to step into the breach and help finance infrastructure projects, including wind farms, in the UK to the tune of ‘billions of pounds’.
The state-backed lender is the Japanese Bank for International Cooperation.
Given that the UK’s own Green Investment Bank is currently limited to £3bn it is perfectly possible that the UK’s green industries will recieve more funding form the Japanese state than the British one. This strikes me as an odd development.
None of this is new, of course. Foreign investment banks have been buying up British industry for years. As I wrote at Left Foot Forward, the China Investment Corporation now owns 9 per cent of Thames Water, and Abu Dhabi owns another 10 per cent:
With Thames Water now almost a fifth owned by foreign governments, and vast amounts of foreign state ownership in other public infrastructure companies from trains (Arriva) to postal services (DHL) and energy (EDF), the government will have an increasingly hard line justifying its long-held belief that private companies are inherently more efficient than state-owned ones.
Indeed, with the opening of the London-Frankfurt line in 2015, Deutsche Bahn will be operating on British soil under its own name for the first time.
Britain is finally getting a start on investing in our own infrastructure, rather than waiting for others to do it for us. As Joe Manning wrote yesterday, London boroughs aren't waiting for central government to get started, pooling their resources to get a better return for their money and improve the city with one move. It makes sense:
Pension funds have long time horizons. This means that they are well placed to invest in the infrastructure that is crucial to economic growth but will not realise immediate returns, such as new transport connections. In fact, there is a near perfect match between pension funds' appetite for long term assets and the need for long term financing of infrastructure.
Or we could do nothing. That seems like a popular plan.