Economist David Smith believes that the crisis in the financial services sector and the fall in the value of the pound could lead to a long awaited rebalancing of the economy. Siemens Automation & Drives recently hosted a briefing, where Smith examined the notion that the economy could tip towards the manufacturing sector and away from services.
He said: ‘The combination of a financial services sector facing weaker growth, the falling value of the pound and a manufacturing sector which is naturally hedged by its reliance on a diverse range of markets, limiting exposure to the American economy and a UK consumer downturn, is already resulting in strong growth and excellent export figures for manufacturers.’
In his speech, Smith urged UK Manufacturers to continue efforts to increase efficiency and productivity and to look at China and India as significant opportunities rather than a threat.
‘How manufacturing rises to the efficiency challenge is a key question, particularly in an era when the UK will be looking for a bigger contribution from exports and credit will be tighter,’ said Smith.
Siemens Automation & Drives managing director Juergen Maier added: ‘There is growing evidence that many issues associated with low cost economies, such as quality, servicing and after-sales support are encouraging the return of some manufacturing to UK shores from low cost economies.’