24.02.16
Northern Powerhouse needs direct foreign investment to succeed – AECOM
The Northern Powerhouse needs foreign direct investment to succeed, according to global infrastructure services firm AECOM.
Richard Green, the design, planning and economics director at AECOM’s Manchester office, said large-scale transport projects such as HS2 and Crossrail are vital for attracting investment from countries such as the USA and China.
He also said that local, regional and planning authorities should invest in other infrastructure developments to create the right conditions to attract international investment.
Green, speaking ahead of tomorrow’s Northern Powerhouse International Conference, said: “Investors don’t back countries, they back their best bet of getting a return. The north has to compete for investment like any other potential recipient project in every country.
“It is therefore critical that transport infrastructure isn’t planned in a silo. Other important enablers such as housing, employment, schools and hospitals all play a crucial role in ensuring that people will want to live and work in an area. Real estate values will increase as a consequence, making infrastructure projects an attractive investment proposition.”
Recently at RTM’s TransCity Rail North event, Philip Hoare, Group MD of Atkins Transportation, underlined the importance of foreign direct investment in the UK rail sector, claiming there are a number of organisations out there “looking to put private sector money into things”.
“We know that our chancellor spent quite a bit of time out in China recently – in fact, he announced the HS2 contracts in China. We also know there’s an awful lot of Chinese interest and Chinese money that’s interested in the UK market,” said Hoare.
“I think how we deal with foreign direct investment and how we make that work for us is something that is quite attractive.”
Northern Rail’s boss, Alex Hynes, agreed with this saying that there are companies “desperate to buy British assets” – particularly in the country’s “booming railways”.
“Foreign money, just like it flooded into the London property market, wants to flood into British assets,” he said. “There are loads of people who want to lend us huge amounts of money.”
Earlier this week, Fusion JV, which is bidding for work on HS2 phase 1, appointed AECOM as its lead designer.
Green also noted that other northern cities should adopt the mayoral governance model used in Manchester to increase their ability to deliver projects extending to wider commuting and economic city regions.
He warned that developing transport infrastructure projects involving multiple conurbations would be important but more challenging.
“The UK winners will be those that are best connected to each other and their overseas counterparts. Large-scale transport infrastructure projects are therefore a vital component of the Powerhouse project – but in planning terms, they present many more challenges,” said Green.
“This is why Transport for the North has such a vital role to play in bringing local transport authorities together – not only to speak with one voice to UK government, but also to potential foreign investors.”