By Mark Powney, Managing Director, Business News Wales
Wales has a new First Minister, bringing to an end a short period of uncertainty in the Welsh political landscape.
Whilst the timeframe between Vaughan Gething resigning and Eluned Morgan being voted in was brief it was nevertheless unsettling for the Welsh business community, especially coming so soon after the hiatus of a General Election.
With the new First Minister now in post, it’s a good opportunity to reflect on a new era of political alignment with Labour governments leading both Westminster and Cardiff.
This unified political landscape offers a unique opportunity for Wales to advance its economic development agenda, focusing on improving the business environment, enhancing infrastructure, and fostering regional growth. The challenge lies in leveraging this political synergy to create a robust and dynamic economic future for Wales.
Over the past five years, the Welsh Government has perhaps placed less emphasis on improving the business environment. However, with the new Labour leadership, there is potential for a renewed focus building strong regional and industry partnerships with business in Wales.
Investing in education and training will ensure the workforce possesses the necessary skills to meet the demands of modern industries. Furthermore, providing financial support and incentives to businesses to stimulate growth and innovation will be key.
Infrastructure improvement will also be important by upgrading transportation, communication networks, and utility services to support business operations and connectivity.
A key component of this strategy also involves making sites and premises attractive and viable for business investments. Once businesses invest in a region, they are more likely to stay, driving long-term economic growth.
The interplay between the UK Labour Government and the Welsh Labour Government will be crucial. The UK Labour Government, facing constraints on tax rises, is already placing a heavy emphasis on growth. Wales therefore must align its policies to capitalise on national strategies while ensuring regional needs are met.
One area of focus should be the creation and empowerment of delivery vehicles for economic development. The Welsh Development Agency no longer exists, but structures like the Corporate Joint Committees (CJCs) and combined authorities, such as the Cardiff Capital Region and similar entities in North, South West, and Mid Wales, can play pivotal roles. These bodies need to be well-funded and given the authority to drive regional development effectively.
Wales has also faced challenges with bureaucratic delays in implementing economic initiatives, such as the Freeports programme, which took two years longer to launch compared to England. This delay eroded the first-mover advantage and allowed other regions in England to forge ahead. Streamlining processes and reducing delays in implementation are critical for Wales to remain competitive.
The shift from block grants to challenge funding by the previous UK government introduced a competitive element to securing funds. This has exposed a need for improved skills in pitching and presenting projects within the Welsh Government. Developing these capabilities will be essential if the new UK Government continues with challenge funding models. Sharpening our ability to secure these funds can lead to significant investments in infrastructure and development projects.
Infrastructure, particularly transport, remains a vital area for improvement. Efficient and reliable transportation networks are essential for economic growth, facilitating the movement of goods and people.
Key areas for improvement include upgrading rail services and expanding road networks to reduce travel times and improve connectivity within Wales and beyond.
Enhancing broadband and mobile connectivity to support businesses, especially in rural areas, will help attract technology-driven industries.
Finally investing in sustainable and green transport solutions to meet environmental goals and improve quality of life is a key ingredient for a future Wales and the opportunities that come with this should not be missed.
The Labour Governments in Westminster and Cardiff now have a unique opportunity to collaborate and drive significant economic development in Wales.
Overcoming bureaucratic delays, mastering the challenge funding process, and investing in critical infrastructure will be key to realising this vision.
