We Shouldn't Need Tech City
By Rob | 22 Mar 2012, 12:00pm | Category: General
There seems to be a lot of talk about Tech City at the mo and whether it has been a good thing or not. @Olivia_Solon over at Wired Magazine has written a detailed 'expose' and a supportive blog post on London's 'coolest' QUANGO. While @Nero has questioned whether Tech City will be around for too much longer.
Anyway as a start up wanabe, not based in East London, I thought I'd provide a few of my own thoughts on this topic. For me this issue isn't really about whether the people at Tech City are doing a good job or not. I'm sure they are trying their best to fulfill the objectives of their mandate. And their £1.7m budget is hardly worth mentioning -- even in these austere times...
The question we need to ask ourselves is why do we need QUNAGOs like Tech City at all? @Olivia_Solon suggests that one of the main reasons is to attract foreign investment to London...
Tech City was officially launched out of UKTI in November 2010 by David Cameron to promote the vibrancy and growth of the area to attract foreign direct investment, entrepreneurs and large companies to the area. It aims to provide a direct dial to policy makers, organise networking and cheerleading events as well as encourage companies looking for a European HQ to consider London over other cities.
My question would be, should this not be obvious? Surely it should be abunduntly clear why foreign investors, entrepreneurs and corporations should want to do business in London..? And even the UK as a whole.
The reason I ask this is that on a country level we don't actually live in a very competitive World. Some of you may baulk at this idea -- but consider this. According to the Economist Intelligence Unit Democracy Index out of 167 countries across the world only 25 are fully democratic. This represents just over 10% of the World's population. Basically only one in ten people on our planet live in a country where concepts like free trade and property rights are generally respected. Things that are essential to business success.
To provide an analogy it's a bit like having a PC market where only Apple and HP are capable of producing laptops with functioning keyboards. Essentially there is no competition so the potential reward for new participants with innovative technology is huge.
So why is the UK not cleaning up? Well, because we're not very competitive. Let me show you a comparisson of the UK vs the BRIC nations in terms of government spending*...
|Country||Spending to GDP||Public Debt||Surplus +/-|
What this shows is that the UK State places a greater burden on individuals and businesses than many of our up and coming competitors. Which makes business more difficult -- and that's without mentioning regulation or our tax code.
And while the BRIC nations may struggle with democracy it will be easier for them to improve in this area than for us to resolve our Government spending and debt issues.
How does this relate to Tech City? Well, until we resolve the above issue and become more competitive we are going to need as much flag waving as possible. So we should welcome Tech City's help for the time being. But as a community of developers, creatives and entrepreneurs we need to push our Government to become more streamline so the UK is more competitive.
Then there will be no need for Tech City or any other business QUANGO because the UK will be the obvious business choice.
* Source is CIA World Factbook. Note I appreciate the figures may not be definitive, but the picture they paint is relatively accurate.