Leading finance experts urged Isle of Man businesses to challenge preconceptions about the global economy and cautioned against too heavy a focus on the emerging markets at a Barclays Wealth and Investment Management industry event in the Island on Thursday 21 March.
Hosted by Steve Clarke and the Corporate, Intermediary and Local Markets teams in the Isle of Man, chief executive officers and business leaders gathered at the Mount Murray Hotel and Country Club to hear from Kevin Gardiner, head of investment strategy at Barclays Wealth and Investment Management and Paul Markillie, the innovation editor at the Economist. Sixth Form Economics Students from Ballakermeen High School were invited to the conference.
Both speakers outlined their views of the global economy in light of what Mr Markillie identified as the ‘Third Industrial Revolution’ in his renowned article on manufacturing published in the Economist.
According to Mr Markillie this revolution is being enabled by new technology particularly in additive manufacturing or 3D printing as it is popularly known.
“Advances in technology are reducing the manufacturing industry’s reliance on economies of scale and unit labour costs,” he said.
“Where previously large scale operations were needed to make manufacturing work financially, new processes mean that businesses can be more nimble: creating prototypes quickly and cheaply. This is having the effect of bringing a lot of businesses back to the developed world.”
Mr Gardiner agreed that the world was potentially shifting away from emerging markets. “It is certainly true that developed world economies are not growing as strongly as we might like.
“However we must remember to look beyond the accepted view that they are struggling. In actual fact developed economies have shown strong performance. US companies, over the long term, have out-performed their counterparts in China.
“Developing economies have done a lot of catching up over the last decade leading many to assume that this is the most desirable place to invest. However, factors like rising labour costs and new technologies like 3D printing have resulted in businesses focusing back on the developed world. We could be seeing the pendulum of investment starting to swing away from emerging markets.
“What this latest trend shows is the importance of staying invested. Businesses should not panic or jump on the latest trend without properly interrogating the market. A long term view is often ignored when there is a sudden shift in market priorities but sometimes the best move to make is no move at all.”
The opportunities for the Isle of Man are not solely limited to investment in other markets. Mr Markillie described a world where anyone with a laptop and an internet connection could become a manufacturer.
“It’s an exciting time for innovation. 3D printers have been a key factor in the ‘maker’ movement, which has energy much like the early days of Macintosh computers – perhaps we will see the next Apple come from this movement,” he said.
Given the ease of access to these new technologies, the seminar audience was told there is no reason why the next ‘Apple’ could not come from an Isle of Man-based entrepreneur.
Chris Corlett: “It’s great for the Isle of Man to benefit from Barclays’ access to global expertise through events such as this. Both speakers were world-class. I spoke to many of the business people and students who attended and all reported they found the evening very thought-provoking. Emerging markets are undoubtedly one of the Island’s key targets and it was a fascinating opportunity to gain additional insight and discuss ongoing trends.”
Commenting after the event, Gary Wainwright, Economics teacher at Ballakermeen High School said “I was so enthused by the possibilities of 3D printing that I bought a book from Makerbot and ordered a 3D model from Shapeways."
His comments were echoed by Economics student Andrew Taylor "Terrific- the Island was once again remarkably fortunate for such a lucent display of our economic potential in the years to come, delivered by a world class cohort from London. A true privilege."
Photo - (l-r): Steve Clarke, Paul Markillie, Chris Corlett and Kevin Gardiner
