Exclusive: Siemens UK boss explains why the pandemic has been a ‘helpful’ distraction from Brexit
Despite the many difficulties, the pandemic also brought some good, such as a distraction from Brexit, Siemens UK CEO Carl Ennis tells City PM in an exclusive interview.
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Brexit
The fact that the virus pushed Brexit down the hierarchy of news was helpful, in Ennis’ view.
“Anybody who’s been involved in negotiating a big deal knows you don’t want to do it on a public stage. The challenge is how to unlock the benefits people wanted without causing damage in the short term for individuals, society and business,” he notes.
“The negotiating teams have been trying hard to do just that. Anything that goes above WTO arrangements will be positive.”
Brexit has not stopped Siemens investing in the UK. In Hull, the company partnered with Associated British Ports in a £310m investment to build a wind turbine blade manufacturing facility, thereby creating 1,000 jobs.
Moreover, the company recently invested £200m in Goole on a train facility to build underground trains, creating around 700 new jobs.
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Ennis stresses that, from a business perspective, erecting barriers to trade is never a good idea.
“Brexit is likely to result in friction between us and our biggest trading partner, mainland Europe. Luckily, as a nation we’re pretty good at triumphing over adversity and our business people are entrepreneurial.”
“While we would rather the added level of complexity of Brexit wasn’t there, it’s not stopping us from doing business.”
Carl Ennis
However, the UK’s breakaway will make life difficult for Siemens’ suppliers and partners with vertically integrated supply chains in continental Europe and those who are trying to sell their products there.
“A brave person might make predictions about where they will be in a year’s time. But I will put my crystal ball aside for now,” he laughs.
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Digitalisation
Looking at a long-term impact of the Coronavirus, the shock that the pandemic has delivered to the UK economy may speed up digitalisation across many industries.
“Unfortunately, it will be painful for many sectors and businesses, but in the mid to long term it will be positive. History shows that when countries go through industrial revolutions there are winners and losers, but overall in the end everyone’s a winner,” Ennis says.
He singles out adult learning, calling it “crucial” while it has gone unaddressed in the UK for too long.
“Covid-19 and Brexit have reinforced the need for us to develop and change our skills. This is not just about technical expertise; soft skills and vocational work will become increasingly necessary.”
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Decarbonisation
One of the benefits of an increasingly accepted working-from-home model, a direct result of the pandemic, is accelerated decarbonisation. Despite the economy nearly being crippled during the first lockdown, CO2 emissions were reduced by 20% and nitric oxide by 40%.
“Strategies to increase decarbonisation will be central to discussion at next year’s UN Climate Change Conference, COP26, in Glasgow, in which I hope President-elect Biden’s administration will play a crucial role. Having the US agree that climate change is a real risk, with its scale and ability to influence global policies, will help the world address the issue,” Ennis says.
However, his worry for the UK is that in the government’s enthusiasm to kick-start the economy, policy makers may opt for what is easy or cheap rather than what is right.
“Instead of trying to generate short-term jobs we must ‘grow back green’ and invest in long-term jobs that help decarbonise,” Ennis argues.
The government is focused on identifying a couple of big things it can do to achieve the decarbonisation targets, he continues, pointing out the importance of these large-scale projects, such as investing in wind power and hydrogen.
Wind power is generating just over 20% of the UK’s electricity, and he believes hydrogen has huge potential for fuelling vehicles and trains and for replacing natural gas in home heating systems and industrial turbines.
However, local initiatives are essential if the UK wants to meet its net zero carbon targets. “The old adage of environmentalists is ‘reduce, reuse, recycle’. Reducing consumption requires all 66m people in the UK to participate,” Ennis concludes.
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